diff --git a/tests/test.fish b/tests/test.fish
index eb535fce8..1dbe22b55 100644
--- a/tests/test.fish
+++ b/tests/test.fish
@@ -22,7 +22,7 @@ end
 # These env vars should not be inherited from the user environment because they can affect the
 # behavior of the tests. So either remove them or set them to a known value.
 # See also tests/interactive.fish.
-set TERM xterm
+set -gx TERM xterm
 set -e COLORTERM
 set -e INSIDE_EMACS
 set -e ITERM_PROFILE