I added this to a discussion on the MacAdmins Slack today and realized it could be useful for a broader audience.
The underlying problem is that by default HFS+ (the file system of OS X) is “case preserving, but case-insensitive.” That means the file system will remember wether you named a file or directory “README.TXT” “ReadMe.txt” or “readme.TXT” and preserve that case, but using either of these will point to the same file.
This may be confusing in Terminal. Since most other Unix and Linux file-system are case-sensitive (i.e. README.TXT and readme.txt are different files) most shells are, too. So on OS X in bash you can write:
$ cd ~/DESKTOP
and it will actually work. Though if you then print the working directory, you get
$ pwd /Users/armin/DESKTOP
which doesn’t hurt anything really, since Desktop and DESKTOP are the same. But it does hurt our OCD, right?
While I have not yet found a way to change this behaviour directly, one thing you can change is wether tab-completion is case-sensitive or not. Since the underlying filesystem is insensitive, there really is no reason tab-completion should be. This way you can type /sy[tab]/l[tab]/cor[tab] and it will expand to /System/Library/CoreServices/.
Tab-completion is not just for laziness, but also a way to ensure you are typing a path correctly, especially since tab-completion will escape spaces and other nasty characters automatically.
To make tab-completion in bash case-insensitive put this in your .inputrc (create if necessary)
# Ignore case while completing set completion-ignore-case on
and then close all Terminal windows and start a new one.