diff --git a/INSTALL b/INSTALL
index 4d2334e2f..4395107bf 100644
--- a/INSTALL
+++ b/INSTALL
@@ -41,17 +41,17 @@ registry file for your bot.
 
   Local Install
 
-    You can install Supybot in a local directory by using the '--prefix'
+    You can install Supybot in a local directory by using the '--user'
   option when running 'setup.py'.  E.g., 'python setup.py install
-  --prefix=$HOME' to install into your home directory.  You'll now have
-  a $HOME/bin directory containing Supybot programs ('supybot',
-  'supybot-wizard', etc.) and a $HOME/lib directory containing the
+  --user' to install into your home directory.  You'll now have
+  a $HOME/.local/bin directory containing Supybot programs ('supybot',
+  'supybot-wizard', etc.) and a $HOME/.local/lib directory containing the
   Supybot libraries.  It is also recommended that you setup a proper
   PYTHONPATH environment variable in your shell's init file.
 
-      bash -- 'export PYTHONPATH=$HOME/lib/python2.x/site-packages'
+      bash -- 'export PYTHONPATH=$HOME/.local/lib/python2.x/site-packages'
 
-      (t)csh -- 'setenv PYTHONPATH $HOME/lib/python2.x/site-packages'
+      (t)csh -- 'setenv PYTHONPATH $HOME/.local/lib/python2.x/site-packages'
 
 Windows