diff --git a/packages/coding-agent/CHANGELOG.md b/packages/coding-agent/CHANGELOG.md
index 540e6aaa..921de6cd 100644
--- a/packages/coding-agent/CHANGELOG.md
+++ b/packages/coding-agent/CHANGELOG.md
@@ -6,6 +6,7 @@
 
 - RpcClient now forwards subprocess stderr to parent process in real-time ([#2805](https://github.com/badlogic/pi-mono/issues/2805))
 - Theme file watcher now handles async `fs.watch` error events instead of crashing the process ([#2791](https://github.com/badlogic/pi-mono/issues/2791))
+- Fixed CLI extension paths like `git:gist.github.com/...` being incorrectly resolved against cwd instead of being passed through to the package manager ([#2845](https://github.com/badlogic/pi-mono/pull/2845) by [@aliou](https://github.com/aliou))
 
 ## [0.65.0] - 2026-04-03
 
diff --git a/packages/coding-agent/src/core/package-manager.ts b/packages/coding-agent/src/core/package-manager.ts
index 39c2751d..10781274 100644
--- a/packages/coding-agent/src/core/package-manager.ts
+++ b/packages/coding-agent/src/core/package-manager.ts
@@ -7,6 +7,7 @@ import ignore from "ignore";
 import { minimatch } from "minimatch";
 import { CONFIG_DIR_NAME } from "../config.js";
 import { type GitSource, parseGitUrl } from "../utils/git.js";
+import { isLocalPath } from "../utils/paths.js";
 import { isStdoutTakenOver } from "./output-guard.js";
 import type { PackageSource, SettingsManager } from "./settings-manager.js";
 
@@ -1258,15 +1259,7 @@ export class DefaultPackageManager implements PackageManager {
 			};
 		}
 
-		const trimmed = source.trim();
-		const isWindowsAbsolutePath = /^[A-Za-z]:[\\/]|^\\\\/.test(trimmed);
-		const isLocalPathLike =
-			trimmed.startsWith(".") ||
-			trimmed.startsWith("/") ||
-			trimmed === "~" ||
-			trimmed.startsWith("~/") ||
-			isWindowsAbsolutePath;
-		if (isLocalPathLike) {
+		if (isLocalPath(source)) {
 			return { type: "local", path: source };
 		}
 
diff --git a/packages/coding-agent/src/core/resource-loader.ts b/packages/coding-agent/src/core/resource-loader.ts
index 9450c9ed..8377eff4 100644
--- a/packages/coding-agent/src/core/resource-loader.ts
+++ b/packages/coding-agent/src/core/resource-loader.ts
@@ -8,6 +8,7 @@ import type { ResourceDiagnostic } from "./diagnostics.js";
 
 export type { ResourceCollision, ResourceDiagnostic } from "./diagnostics.js";
 
+import { isLocalPath } from "../utils/paths.js";
 import { createEventBus, type EventBus } from "./event-bus.js";
 import { createExtensionRuntime, loadExtensionFromFactory, loadExtensions } from "./extensions/loader.js";
 import type { Extension, ExtensionFactory, ExtensionRuntime, LoadExtensionsResult } from "./extensions/types.js";
@@ -404,7 +405,7 @@ export class DefaultResourceLoader implements ResourceLoader {
 		}
 
 		for (const p of this.additionalExtensionPaths) {
-			if (!existsSync(p)) {
+			if (isLocalPath(p) && !existsSync(p)) {
 				extensionsResult.errors.push({ path: p, error: `Extension path does not exist: ${p}` });
 			}
 		}
@@ -418,7 +419,7 @@ export class DefaultResourceLoader implements ResourceLoader {
 		this.lastSkillPaths = skillPaths;
 		this.updateSkillsFromPaths(skillPaths, metadataByPath);
 		for (const p of this.additionalSkillPaths) {
-			if (!existsSync(p) && !this.skillDiagnostics.some((d) => d.path === p)) {
+			if (isLocalPath(p) && !existsSync(p) && !this.skillDiagnostics.some((d) => d.path === p)) {
 				this.skillDiagnostics.push({ type: "error", message: "Skill path does not exist", path: p });
 			}
 		}
@@ -430,7 +431,7 @@ export class DefaultResourceLoader implements ResourceLoader {
 		this.lastPromptPaths = promptPaths;
 		this.updatePromptsFromPaths(promptPaths, metadataByPath);
 		for (const p of this.additionalPromptTemplatePaths) {
-			if (!existsSync(p) && !this.promptDiagnostics.some((d) => d.path === p)) {
+			if (isLocalPath(p) && !existsSync(p) && !this.promptDiagnostics.some((d) => d.path === p)) {
 				this.promptDiagnostics.push({ type: "error", message: "Prompt template path does not exist", path: p });
 			}
 		}
diff --git a/packages/coding-agent/src/main.ts b/packages/coding-agent/src/main.ts
index da6d9f5c..30fe779d 100644
--- a/packages/coding-agent/src/main.ts
+++ b/packages/coding-agent/src/main.ts
@@ -35,6 +35,7 @@ import { runMigrations, showDeprecationWarnings } from "./migrations.js";
 import { InteractiveMode, runPrintMode, runRpcMode } from "./modes/index.js";
 import { initTheme, stopThemeWatcher } from "./modes/interactive/theme/theme.js";
 import { handleConfigCommand, handlePackageCommand } from "./package-manager-cli.js";
+import { isLocalPath } from "./utils/paths.js";
 
 /**
  * Read all content from piped stdin.
@@ -371,7 +372,7 @@ function buildSessionOptions(
 }
 
 function resolveCliPaths(cwd: string, paths: string[] | undefined): string[] | undefined {
-	return paths?.map((value) => resolve(cwd, value));
+	return paths?.map((value) => (isLocalPath(value) ? resolve(cwd, value) : value));
 }
 
 export async function main(args: string[]) {
diff --git a/packages/coding-agent/src/utils/paths.ts b/packages/coding-agent/src/utils/paths.ts
new file mode 100644
index 00000000..4884d15c
--- /dev/null
+++ b/packages/coding-agent/src/utils/paths.ts
@@ -0,0 +1,20 @@
+/**
+ * Returns true if the value is NOT a package source (npm:, git:, etc.)
+ * or a URL protocol. Bare names and relative paths without ./ prefix
+ * are considered local.
+ */
+export function isLocalPath(value: string): boolean {
+	const trimmed = value.trim();
+	// Known non-local prefixes
+	if (
+		trimmed.startsWith("npm:") ||
+		trimmed.startsWith("git:") ||
+		trimmed.startsWith("github:") ||
+		trimmed.startsWith("http:") ||
+		trimmed.startsWith("https:") ||
+		trimmed.startsWith("ssh:")
+	) {
+		return false;
+	}
+	return true;
+}