diff --git a/profile.d/toolbox.sh b/profile.d/toolbox.sh
index 020d6e8ad..62939df4e 100644
--- a/profile.d/toolbox.sh
+++ b/profile.d/toolbox.sh
@@ -4,7 +4,14 @@
 [ "${BASH_VERSION:-}" != "" ] || [ "${ZSH_VERSION:-}" != "" ] || return 0
 [ "$PS1" != "" ] || return 0
 
-toolbox_config="${XDG_CONFIG_HOME:-$HOME/.config}/toolbox"
+root_config="${XDG_CONFIG_HOME:-$HOME/.config}"
+toolbox_config="$root_config/toolbx"
+toolbox_config_old="$root_config/toolbox"
+
+if [ -d "$toolbox_config_old" ] && ! [ -e "$toolbox_config" ]; then
+    mv "$toolbox_config_old" "$toolbox_config" 2>/dev/null
+fi
+
 host_welcome_stub="$toolbox_config/host-welcome-shown"
 toolbox_welcome_stub="$toolbox_config/toolbox-welcome-shown"
 
diff --git a/src/cmd/root.go b/src/cmd/root.go
index 2259d3f65..713ea013a 100644
--- a/src/cmd/root.go
+++ b/src/cmd/root.go
@@ -238,7 +238,7 @@ func migrate(cmd *cobra.Command, args []string) error {
 		return errors.New("failed to get the user config directory")
 	}
 
-	toolboxConfigDir := configDir + "/toolbox"
+	toolboxConfigDir := configDir + "/toolbx"
 	stampPath := toolboxConfigDir + "/podman-system-migrate"
 	logrus.Debugf("Toolbx config directory is %s", toolboxConfigDir)
 
diff --git a/test/system/libs/helpers.bash b/test/system/libs/helpers.bash
index 4b48c7009..7d0ca2586 100644
--- a/test/system/libs/helpers.bash
+++ b/test/system/libs/helpers.bash
@@ -166,9 +166,9 @@ function _setup_docker_registry() {
   assert_success
 
   # Add certificate to Podman's trusted certificates (rootless)
-  run mkdir -p "$HOME"/.config/containers/certs.d/"${DOCKER_REG_URI}"
+  run mkdir -p "$XDG_CONFIG_HOME"/containers/certs.d/"${DOCKER_REG_URI}"
   assert_success
-  run cp "${DOCKER_REG_CERTS_DIR}"/domain.crt "$HOME"/.config/containers/certs.d/"${DOCKER_REG_URI}"/domain.crt
+  run cp "${DOCKER_REG_CERTS_DIR}"/domain.crt "$XDG_CONFIG_HOME"/containers/certs.d/"${DOCKER_REG_URI}"/domain.crt
   assert_success
 
   # Create a registry user
@@ -234,7 +234,7 @@ function _clean_docker_registry() {
   # Remove Docker registry dir
   rm --force --recursive "${DOCKER_REG_ROOT}"
   # Remove dir with created registry certificates
-  rm --force --recursive "$HOME"/.config/containers/certs.d/"${DOCKER_REG_URI}"
+  rm --force --recursive "$XDG_CONFIG_HOME"/containers/certs.d/"${DOCKER_REG_URI}"
 }