Apple - Is bash in OSX case-insensitive?

This is actually a feature of the filesystem of your disk, not bash or Terminal.app.

HFS+ (the Mac filesystem) is usually configured to be case insensitive but case preserving. This means that the file system will consider foo and FoO to be the same, but when you create a new file it will remember which letters where capitalized and which were not.

When you format a disk with HFS+ you can chose whether the file system should case sensitive or not. If you chose to format with UFS (Unix FileSystem) it is always case sensitive, AFAIK.

To check whether a disk is case sensitive, run:

 diskutil info <device>

For example:

 diskutil info disk0s2

Look for the Name: line. If it reads something like Mac OS Extended (Case-sensitive, Journaled) it means that it is case-sensitive. If it just reads Mac OS Extended (without the Case-sensitive) then it is only case preserving but not case sensitive.

I managed to fix this with one line by following http://blog.nickburwell.com/blog/2008/11/mac-os-x-terminal-case-insensitive-auto

echo "set completion-ignore-case On" >> ~/.inputrc

Take a look at your filesystem, as there are both case sensitive and case insensitive variations on HFS. The default is case insensitive, in which case it's not so much a case of BASH, but the underlying filesystem. You can test this by formatting a spare USB stick with the case sensitive option, and copying files over ato repeat your test, etc.