diff --git a/.changeset/gentle-countries-bake.md b/.changeset/gentle-countries-bake.md
new file mode 100644
index 000000000..0cfa23648
--- /dev/null
+++ b/.changeset/gentle-countries-bake.md
@@ -0,0 +1,5 @@
+---
+"@bigcommerce/create-catalyst": patch
+---
+
+use `--prefix` npm flag to set `cwd` for GraphQL schema generation insead of `exec`'s `cwd` option
diff --git a/packages/create-catalyst/src/commands/create.ts b/packages/create-catalyst/src/commands/create.ts
index f14fdafb9..b6e28e0de 100644
--- a/packages/create-catalyst/src/commands/create.ts
+++ b/packages/create-catalyst/src/commands/create.ts
@@ -198,7 +198,7 @@ export const create = async (options: CreateCommandOptions) => {
 
   await installDependencies(projectDir, packageManager);
 
-  await spinner(exec(`${packageManager} run generate`, { cwd: projectDir }), {
+  await spinner(exec(`${packageManager} run --prefix ${projectDir} generate`), {
     text: 'Creating GraphQL schema...',
     successText: 'Created GraphQL schema',
     failText: (err) => chalk.red(`Failed to create GraphQL schema: ${err.message}`),