Index: lib/rubygems/dependency_installer.rb
===================================================================
--- lib/rubygems/dependency_installer.rb	(revision 1678)
+++ lib/rubygems/dependency_installer.rb	(working copy)
@@ -189,7 +189,7 @@
       say "Installing gem #{spec.full_name}" if Gem.configuration.really_verbose
 
       _, source_uri = @specs_and_sources.assoc spec
-      local_gem_path = Gem::RemoteFetcher.fetcher.download spec, source_uri
+      local_gem_path = Gem::RemoteFetcher.fetcher.download spec, source_uri, @install_dir
 
       inst = Gem::Installer.new local_gem_path,
                                 :env_shebang => @env_shebang,