diff --git a/src/main/java/com/google/devtools/build/lib/util/ShellEscaper.java b/src/main/java/com/google/devtools/build/lib/util/ShellEscaper.java
index d54bbdaf8e5c0f..121fbb8284006d 100644
--- a/src/main/java/com/google/devtools/build/lib/util/ShellEscaper.java
+++ b/src/main/java/com/google/devtools/build/lib/util/ShellEscaper.java
@@ -63,6 +63,8 @@ public final class ShellEscaper extends Escaper {
           .or(CharMatcher.inRange('a', 'z')) // that would also accept non-ASCII digits and
           .or(CharMatcher.inRange('A', 'Z')) // letters.
           .precomputed();
+  private static final CharMatcher SAFECHAR_MATCHER_WITH_TILDE =
+      SAFECHAR_MATCHER.or(CharMatcher.is('~')).precomputed();
 
   /**
    * Escapes a string by adding strong (single) quotes around it if necessary.
@@ -98,9 +100,13 @@ public String escape(String unescaped) {
       // gets treated as a separate argument.
       return "''";
     } else {
-      return SAFECHAR_MATCHER.matchesAllOf(s)
-          ? s
-          : "'" + STRONGQUOTE_ESCAPER.escape(s) + "'";
+      if (SAFECHAR_MATCHER.matchesAllOf(s)) {
+        return s;
+      }
+      if (SAFECHAR_MATCHER_WITH_TILDE.matchesAllOf(s) && s.charAt(0) != '~') {
+        return s;
+      }
+      return "'" + STRONGQUOTE_ESCAPER.escape(s) + "'";
     }
   }
 
diff --git a/src/test/java/com/google/devtools/build/lib/util/ShellEscaperTest.java b/src/test/java/com/google/devtools/build/lib/util/ShellEscaperTest.java
index cad9ce53f24add..05c5cc676e707a 100644
--- a/src/test/java/com/google/devtools/build/lib/util/ShellEscaperTest.java
+++ b/src/test/java/com/google/devtools/build/lib/util/ShellEscaperTest.java
@@ -41,6 +41,9 @@ public void shellEscape() throws Exception {
     assertThat(escapeString("\\'foo\\'")).isEqualTo("'\\'\\''foo\\'\\'''");
     assertThat(escapeString("${filename%.c}.o")).isEqualTo("'${filename%.c}.o'");
     assertThat(escapeString("<html!>")).isEqualTo("'<html!>'");
+    assertThat(escapeString("~not_home")).isEqualTo("'~not_home'");
+    assertThat(escapeString("external/protobuf~3.19.6/src/google")).isEqualTo("external/protobuf~3.19.6/src/google");
+    assertThat(escapeString("external/~install_dev_dependencies~foo/pkg")).isEqualTo("external/~install_dev_dependencies~foo/pkg");
   }
 
   @Test