diff --git a/runtime/pack/dist/opt/netrw/autoload/netrw.vim b/runtime/pack/dist/opt/netrw/autoload/netrw.vim
index cabcd0c925..90bc4aee02 100644
--- a/runtime/pack/dist/opt/netrw/autoload/netrw.vim
+++ b/runtime/pack/dist/opt/netrw/autoload/netrw.vim
@@ -1,7 +1,7 @@
 " Creator:    Charles E Campbell
 " Previous Maintainer: Luca Saccarola <github.e41mv@aleeas.com>
 " Maintainer: This runtime file is looking for a new maintainer.
-" Last Change: 2026 Jul 23
+" Last Change: 2026 Aug 21
 " Copyright:  Copyright (C) 2016 Charles E. Campbell {{{1
 "             Permission is hereby granted to use and distribute this code,
 "             with or without modifications, provided that this copyright
@@ -4494,7 +4494,7 @@ function s:NetrwHome()
         if exists("g:netrw_mkdir")
             call system(g:netrw_mkdir." ".s:ShellEscape(s:NetrwFile(home)))
         else
-            call mkdir(home)
+            call mkdir(home, 'p')
         endif
     endif
 
diff --git a/test/old/testdir/test_plugin_netrw.vim b/test/old/testdir/test_plugin_netrw.vim
index b6a18ff418..431cec8c67 100644
--- a/test/old/testdir/test_plugin_netrw.vim
+++ b/test/old/testdir/test_plugin_netrw.vim
@@ -196,6 +196,11 @@ function Test_NetrwMarkFile_match_pattern_rebuild()
 
   bw
 endfunction
+
+" Test the "home" directory used for bookmarks and history
+function Test_NetrwHome() abort
+    return s:NetrwHome()
+endfunction
 " }}}
 END
 
@@ -921,4 +926,55 @@ func Test_netrw_open_no_dir_arg()
   bw!
 endfunc
 
+func Test_netrw_home_setting()
+  let save_home = get(g:, 'netrw_home', '')
+  let dir = fnamemodify('XnetrwHome', ':p')
+  let vimdir = fnamemodify('XvimDir', ':p')
+  let subdir = fnamemodify('XnetrwHomeParent/XnetrwHome', ':p')
+  if has('win32')
+    let dir = substitute(dir, '/', '\\', 'g')
+    let vimdir = substitute(vimdir, '/', '\\', 'g')
+    let subdir = substitute(subdir, '/', '\\', 'g')
+  endif
+  let save_myvimdir = getenv('MYVIMDIR')
+  let $MYVIMDIR = vimdir
+
+  unlet! g:netrw_home
+  if has('nvim')
+    let expected = netrw#fs#PathJoin(stdpath('state'), 'netrw')
+    if has('win32')
+      let expected = substitute(expected, '/', '\\', 'g')
+    endif
+    call assert_equal(expected, Test_NetrwHome())
+  else
+    " without the setting $MYVIMDIR is used
+    call assert_equal(vimdir, Test_NetrwHome())
+  endif
+
+  let g:netrw_home = dir
+  call assert_equal(dir, Test_NetrwHome())
+  call assert_true(isdirectory(dir))
+
+  let g:netrw_home = subdir
+  call assert_equal(subdir, Test_NetrwHome())
+  call assert_true(isdirectory(subdir))
+
+  " the value is expanded
+  let $NETRW_TEST_HOME = dir
+  let g:netrw_home = '$NETRW_TEST_HOME'
+  call assert_equal(dir, Test_NetrwHome())
+
+  call delete(dir, 'd')
+  call delete(vimdir, 'd')
+  call delete(subdir, 'd')
+  call delete(fnamemodify(subdir, ':h'), 'd')
+  unlet $NETRW_TEST_HOME
+  call setenv('MYVIMDIR', save_myvimdir)
+  if empty(save_home)
+    unlet! g:netrw_home
+  else
+    let g:netrw_home = save_home
+  endif
+endfunc
+
 " vim:ts=8 sts=2 sw=2 et