From Bugzilla Helper:
User-Agent: Mozilla/5.0 (X11; U; Linux i686; en-US; rv:1.7.7) Gecko/20050414

Description of problem:
Updated from vte-0.11.11-6 to vte-0.11.13-1.fc3. Users reported gnome-terminal (gnome-terminal-2.7.3-1) prompt was displaying additional characters that originate from the promt environment variable value.                                                                                  

Version-Release number of selected component (if applicable):
vte-0.11.13-1.fc3

How reproducible:
Always

Steps to Reproduce:
1.Update to vte-0.11.13-1.fc3
2.Set prompt var to PS1='\[\033[0;1m\][${PWD}]\[\033[0;m\]$ '
3.Start a gnome-terminal
  

Actual Results:  Prompt displayed as
[/home/username]^[[0;m$

Expected Results:  Prompt displayed as
[/home/username]$

Additional info:

Reverted to vte-0.11.11-6, closed all open gnome-terminals, opened a new terminal and the prompt was displayed correctly without the additional characters.There have not been any reports of the additional characters causing problems in other applications.

The same additional characters appears with the kde terminal as well.