diff --git a/clients/Makefile.am b/clients/Makefile.am
index 8c30882ae..9c14eb936 100644
--- a/clients/Makefile.am
+++ b/clients/Makefile.am
@@ -2,6 +2,8 @@ noinst_PROGRAMS = $(clients_programs) 		\
 	$(poppler_programs) 			\
 	$(simple_clients_programs)
 
+libexec_PROGRAMS = $(desktop_shell)
+
 if BUILD_SIMPLE_CLIENTS
 simple_clients_programs = simple-egl simple-shm
 simple_egl_SOURCES = simple-egl.c
@@ -21,8 +23,9 @@ clients_programs =				\
 	dnd					\
 	smoke					\
 	resizor					\
-	eventdemo				\
-	desktop-shell
+	eventdemo
+
+desktop_shell = wayland-desktop-shell
 
 noinst_LIBRARIES = libtoytoolkit.a
 
@@ -68,11 +71,11 @@ resizor_LDADD = $(toolkit_libs)
 eventdemo_SOURCES = eventdemo.c
 eventdemo_LDADD = $(toolkit_libs)
 
-desktop_shell_SOURCES =				\
+wayland_desktop_shell_SOURCES =			\
 	desktop-shell.c				\
 	desktop-shell-client-protocol.h		\
 	desktop-shell-protocol.c
-desktop_shell_LDADD = $(toolkit_libs)
+wayland_desktop_shell_LDADD = $(toolkit_libs)
 
 BUILT_SOURCES =					\
 	screenshooter-client-protocol.h		\
diff --git a/compositor/Makefile.am b/compositor/Makefile.am
index 991e7539e..f6d5dcdb8 100644
--- a/compositor/Makefile.am
+++ b/compositor/Makefile.am
@@ -3,6 +3,7 @@ bin_PROGRAMS = wayland-compositor
 AM_CPPFLAGS =					\
 	-DDATADIR='"$(datadir)"'		\
 	-DMODULEDIR='"$(moduledir)"'		\
+	-DLIBEXECDIR='"$(libexecdir)"'		\
 	-DXSERVER_PATH='"@XSERVER_PATH@"'	\
 	$(COMPOSITOR_CFLAGS)
 
diff --git a/compositor/shell.c b/compositor/shell.c
index c44ebcad3..193623566 100644
--- a/compositor/shell.c
+++ b/compositor/shell.c
@@ -963,7 +963,7 @@ desktop_shell_sigchld(struct wlsc_process *process, int status)
 static int
 launch_desktop_shell_process(struct wl_shell *shell)
 {
-	const char *shell_exe = "./clients/desktop-shell";
+	const char *shell_exe = LIBEXECDIR "/wayland-desktop-shell";
 	struct wlsc_compositor *compositor = shell->compositor;
 	char s[32];
 	int sv[2], flags;