diff --git a/src/client/terminals/codeExecution/codeExecutionManager.ts b/src/client/terminals/codeExecution/codeExecutionManager.ts
index 740256ca78b3..30e5b7facd2d 100644
--- a/src/client/terminals/codeExecution/codeExecutionManager.ts
+++ b/src/client/terminals/codeExecution/codeExecutionManager.ts
@@ -5,7 +5,7 @@
 
 import { inject, injectable } from 'inversify';
 import { Disposable, EventEmitter, Terminal, Uri } from 'vscode';
-
+import * as path from 'path';
 import { ICommandManager, IDocumentManager } from '../../common/application/types';
 import { Commands } from '../../common/constants';
 import '../../common/extensions';
@@ -130,6 +130,15 @@ export class CodeExecutionManager implements ICodeExecutionManager {
         if (!fileToExecute) {
             return;
         }
+
+        // Check on setting terminal.executeInFileDir
+        const pythonSettings = this.configSettings.getSettings(file);
+        let cwd = pythonSettings.terminal.executeInFileDir ? path.dirname(fileToExecute.fsPath) : undefined;
+
+        // Check on setting terminal.launchArgs
+        const launchArgs = pythonSettings.terminal.launchArgs;
+        const totalArgs = [...launchArgs, fileToExecute.fsPath.fileToCommandArgumentForPythonExt()];
+
         const fileAfterSave = await codeExecutionHelper.saveFileIfDirty(fileToExecute);
         if (fileAfterSave) {
             fileToExecute = fileAfterSave;
@@ -138,19 +147,9 @@ export class CodeExecutionManager implements ICodeExecutionManager {
         const show = this.shouldTerminalFocusOnStart(fileToExecute);
         let terminal: Terminal | undefined;
         if (dedicated) {
-            terminal = await runInDedicatedTerminal(
-                fileToExecute,
-                [fileToExecute.fsPath.fileToCommandArgumentForPythonExt()],
-                undefined,
-                show,
-            );
+            terminal = await runInDedicatedTerminal(fileToExecute, totalArgs, cwd, show);
         } else {
-            terminal = await runInTerminal(
-                fileToExecute,
-                [fileToExecute.fsPath.fileToCommandArgumentForPythonExt()],
-                undefined,
-                show,
-            );
+            terminal = await runInTerminal(fileToExecute, totalArgs, cwd, show);
         }
 
         if (terminal) {