diff --git a/src/wic/oe/path.py b/src/wic/oe/path.py
index 13c52b363694..95bb9648fab6 100644
--- a/src/wic/oe/path.py
+++ b/src/wic/oe/path.py
@@ -355,7 +355,11 @@ def canonicalize(paths, sep=','):
     # prefixes in sting compares later on, where the slashes then are important.
     canonical_paths = []
     for path in (paths or '').split(sep):
-        if '$' not in path:
+        # Skip empty tokens as well as unexpanded bitbake variables: an
+        # empty path would otherwise reach os.path.realpath(''), which
+        # returns the current working directory, so canonicalize('') or
+        # canonicalize(None) would wrongly produce the cwd instead of ''.
+        if path and '$' not in path:
             trailing_slash = path.endswith('/') and '/' or ''
             canonical_paths.append(os.path.realpath(path) + trailing_slash)