Working directory of a process or program is a directory(or folder) of a system, which is dynamically associated with each process that runs on that directory (or is started in that directory or is linked to that directory when it is started)
It is sometimes called the current working directory (CWD), or just current directory
Consider that someone opens a File Explorer (Windows Explorer in Windows) and opens the Downloads folder
That is similar to opening a Terminal (or Command Prompt) and entering a command to change the current directory to Downloads
In Linux, Mac
cd ~/DownloadsIn Windows,
cd C:\Users\SomeUser\DownloadsNow, the working directory for the Terminal or the File Explorer is the Downloads Folder
Furthermore, if the user opens an application or Program by double clicking the application or by entering a command in Terminal, then the working directory of that application becomes the Downloads Folder (unless it is a shortcut icon or symlink)
If that application is copied to some other Folder then its working directory changes to that Folder when executed or run
The application can use the working directory (which is a path like C:\Program Files\Firefox) to access other files inside(or relative to) that directory while it is running
A File Explorer (or a Terminal) is also an application, whose working directory is where it is installed at
It uses some process of the operating system to set the working directory for an user when the user browses a folder or opens an application
In a Terminal this is done with cd command