diff --git a/extensions/git/src/git.ts b/extensions/git/src/git.ts
index 9129f527fe6..c0e643f44d5 100644
--- a/extensions/git/src/git.ts
+++ b/extensions/git/src/git.ts
@@ -329,7 +329,7 @@ export class Git {
 	}
 
 	async clone(url: string, parentPath: string): Promise<string> {
-		const folderName = url.replace(/^.*\//, '').replace(/\.git$/, '') || 'repository';
+		const folderName = decodeURI(url).replace(/^.*\//, '').replace(/\.git$/, '') || 'repository';
 		const folderPath = path.join(parentPath, folderName);
 
 		await mkdirp(parentPath);