diff --git a/.changeset/odd-trains-bake.md b/.changeset/odd-trains-bake.md
new file mode 100644
index 000000000000..b14a8c3eaa0b
--- /dev/null
+++ b/.changeset/odd-trains-bake.md
@@ -0,0 +1,9 @@
+---
+"wrangler": patch
+---
+
+fix: generate site assets manifest relative to `site.bucket`
+
+We had a bug where we were generating asset manifest keys incorrectly if we ran wrangler from a different path to `wrangler.toml`. This fixes the generation of said keys, and adds a test for it.
+
+Fixes #1235
diff --git a/packages/wrangler/src/__tests__/publish.test.ts b/packages/wrangler/src/__tests__/publish.test.ts
index 6ab751fd2d4e..323c57ff58ea 100644
--- a/packages/wrangler/src/__tests__/publish.test.ts
+++ b/packages/wrangler/src/__tests__/publish.test.ts
@@ -2276,6 +2276,59 @@ addEventListener('fetch', event => {});`
       `);
       expect(std.err).toMatchInlineSnapshot(`""`);
     });
+
+    it("should generate an asset manifest with keys relative to site.bucket", async () => {
+      const assets = [
+        { filePath: "file-1.txt", content: "Content of file-1" },
+        { filePath: "file-2.txt", content: "Content of file-2" },
+      ];
+      const kvNamespace = {
+        title: "__test-name-workers_sites_assets",
+        id: "__test-name-workers_sites_assets-id",
+      };
+
+      writeWranglerToml({
+        main: "./src/index.js",
+        site: {
+          bucket: "assets",
+        },
+      });
+      writeWorkerSource({ basePath: "src", type: "esm" });
+      writeAssets(assets);
+      mockUploadWorkerRequest({
+        expectedBindings: [
+          {
+            name: "__STATIC_CONTENT",
+            namespace_id: "__test-name-workers_sites_assets-id",
+            type: "kv_namespace",
+          },
+        ],
+        expectedModules: {
+          __STATIC_CONTENT_MANIFEST:
+            '{"file-1.txt":"file-1.2ca234f380.txt","file-2.txt":"file-2.5938485188.txt"}',
+        },
+      });
+      mockSubDomainRequest();
+      mockListKVNamespacesRequest(kvNamespace);
+      mockKeyListRequest(kvNamespace.id, []);
+      mockUploadAssetsToKVRequest(kvNamespace.id, assets);
+
+      process.chdir("./src");
+      await runWrangler("publish");
+      process.chdir("../");
+
+      expect(std.out).toMatchInlineSnapshot(`
+        "Reading file-1.txt...
+        Uploading as file-1.2ca234f380.txt...
+        Reading file-2.txt...
+        Uploading as file-2.5938485188.txt...
+        ↗️  Done syncing assets
+        Uploaded test-name (TIMINGS)
+        Published test-name (TIMINGS)
+          test-name.test-sub-domain.workers.dev"
+      `);
+      expect(std.err).toMatchInlineSnapshot(`""`);
+    });
   });
 
   describe("workers_dev setting", () => {
diff --git a/packages/wrangler/src/sites.tsx b/packages/wrangler/src/sites.tsx
index 281e0cd510dc..7df353a621e3 100644
--- a/packages/wrangler/src/sites.tsx
+++ b/packages/wrangler/src/sites.tsx
@@ -200,9 +200,7 @@ export async function syncAssets(
     namespaceKeys.delete(assetKey);
 
     // Prevent different manifest keys on windows
-    const manifestKey = urlSafe(
-      path.relative(siteAssets.assetDirectory, absAssetFile)
-    );
+    const manifestKey = urlSafe(path.relative(assetDirectory, absAssetFile));
     manifest[manifestKey] = assetKey;
   }