The derby.system.home property specifies the Derby system directory, which is the directory that contains subdirectories holding databases that you create and the text file derby.properties.
If the system directory that you specify with derby.system.home does not exist at startup, Derby creates the directory automatically.
Current directory (the value of the JVM system property user.dir).
If you do not explicitly set the derby.system.home property when starting Derby, the default is the directory in which Derby was started.
-Dderby.system.home=C:\derby
This property is static; if you change it while Derby is running, the change does not take effect until you reboot.