diff --git a/ext4/internal/compactext4/compact.go b/ext4/internal/compactext4/compact.go
index f40ac8f989..e35536b9fa 100644
--- a/ext4/internal/compactext4/compact.go
+++ b/ext4/internal/compactext4/compact.go
@@ -603,6 +603,8 @@ func (w *Writer) Create(name string, f *File) error {
 }
 
 // Link adds a hard link to the file system.
+// We support creating hardlinks to symlinks themselves instead of what
+// the symlinks link to, as this is what containerd does upstream.
 func (w *Writer) Link(oldname, newname string) error {
 	if err := w.finishInode(); err != nil {
 		return err
@@ -620,8 +622,8 @@ func (w *Writer) Link(oldname, newname string) error {
 		return err
 	}
 	switch oldfile.Mode & format.TypeMask {
-	case format.S_IFDIR, format.S_IFLNK:
-		return fmt.Errorf("%s: link target cannot be a directory or symlink: %s", newname, oldname)
+	case format.S_IFDIR:
+		return fmt.Errorf("%s: link target cannot be a directory: %s", newname, oldname)
 	}
 
 	if existing != oldfile && oldfile.LinkCount >= format.MaxLinks {
diff --git a/ext4/tar2ext4/tar2ext4_test.go b/ext4/tar2ext4/tar2ext4_test.go
index 9156326398..b5117b0419 100644
--- a/ext4/tar2ext4/tar2ext4_test.go
+++ b/ext4/tar2ext4/tar2ext4_test.go
@@ -88,3 +88,76 @@ func Test_UnorderedTarExpansion(t *testing.T) {
 		t.Fatalf("failed to convert tar to layer vhd: %s", err)
 	}
 }
+
+func Test_TarHardlinkToSymlink(t *testing.T) {
+	tmpTarFilePath := filepath.Join(os.TempDir(), "test-layer.tar")
+	layerTar, err := os.Create(tmpTarFilePath)
+	if err != nil {
+		t.Fatalf("failed to create output file: %s", err)
+	}
+	defer os.Remove(tmpTarFilePath)
+
+	tw := tar.NewWriter(layerTar)
+
+	var files = []struct {
+		path     string
+		typeFlag byte
+		linkName string
+		body     string
+	}{
+		{
+			path: "/tmp/zzz.txt",
+			body: "inside /tmp/zzz.txt",
+		},
+		{
+			path:     "/tmp/xxx.txt",
+			linkName: "/tmp/zzz.txt",
+			typeFlag: tar.TypeSymlink,
+		},
+		{
+			path:     "/tmp/yyy.txt",
+			linkName: "/tmp/xxx.txt",
+			typeFlag: tar.TypeLink,
+		},
+	}
+	for _, file := range files {
+		hdr := &tar.Header{
+			Name:       file.path,
+			Typeflag:   file.typeFlag,
+			Linkname:   file.linkName,
+			Mode:       0777,
+			Size:       int64(len(file.body)),
+			ModTime:    time.Now(),
+			AccessTime: time.Now(),
+			ChangeTime: time.Now(),
+		}
+		if err := tw.WriteHeader(hdr); err != nil {
+			t.Fatal(err)
+		}
+		if file.body != "" {
+			if _, err := tw.Write([]byte(file.body)); err != nil {
+				t.Fatal(err)
+			}
+		}
+	}
+	if err := tw.Close(); err != nil {
+		t.Fatal(err)
+	}
+
+	// Now try to import this tar and verify that there is no failure.
+	if _, err := layerTar.Seek(0, 0); err != nil {
+		t.Fatalf("failed to seek file: %s", err)
+	}
+
+	opts := []Option{AppendVhdFooter, ConvertWhiteout}
+	tmpVhdPath := filepath.Join(os.TempDir(), "test-vhd.vhdx")
+	layerVhd, err := os.Create(tmpVhdPath)
+	if err != nil {
+		t.Fatalf("failed to create output VHD: %s", err)
+	}
+	defer os.Remove(tmpVhdPath)
+
+	if err := Convert(layerTar, layerVhd, opts...); err != nil {
+		t.Fatalf("failed to convert tar to layer vhd: %s", err)
+	}
+}
diff --git a/test/vendor/github.com/Microsoft/hcsshim/ext4/internal/compactext4/compact.go b/test/vendor/github.com/Microsoft/hcsshim/ext4/internal/compactext4/compact.go
index f40ac8f989..e35536b9fa 100644
--- a/test/vendor/github.com/Microsoft/hcsshim/ext4/internal/compactext4/compact.go
+++ b/test/vendor/github.com/Microsoft/hcsshim/ext4/internal/compactext4/compact.go
@@ -603,6 +603,8 @@ func (w *Writer) Create(name string, f *File) error {
 }
 
 // Link adds a hard link to the file system.
+// We support creating hardlinks to symlinks themselves instead of what
+// the symlinks link to, as this is what containerd does upstream.
 func (w *Writer) Link(oldname, newname string) error {
 	if err := w.finishInode(); err != nil {
 		return err
@@ -620,8 +622,8 @@ func (w *Writer) Link(oldname, newname string) error {
 		return err
 	}
 	switch oldfile.Mode & format.TypeMask {
-	case format.S_IFDIR, format.S_IFLNK:
-		return fmt.Errorf("%s: link target cannot be a directory or symlink: %s", newname, oldname)
+	case format.S_IFDIR:
+		return fmt.Errorf("%s: link target cannot be a directory: %s", newname, oldname)
 	}
 
 	if existing != oldfile && oldfile.LinkCount >= format.MaxLinks {