diff --git a/src/Paket.Core/NuGetV2.fs b/src/Paket.Core/NuGetV2.fs
index 7902b31cfa..88645c4938 100644
--- a/src/Paket.Core/NuGetV2.fs
+++ b/src/Paket.Core/NuGetV2.fs
@@ -289,6 +289,9 @@ let ExtractPackage(fileName:string, targetFolder, name, version:SemVerInfo) =
             for e in zip do
                 try
                     e.Extract(targetFolder, ExtractExistingFileAction.OverwriteSilently)
+                    let unescapedName = Uri.UnescapeDataString e.FileName
+                    if unescapedName <> e.FileName then
+                        File.Move(Path.Combine(targetFolder, e.FileName), Path.Combine(targetFolder, unescapedName))
                 with
                 | exn ->                    
                     failwithf "Error during unzipping %s in %s %A: %s" e.FileName name version exn.Message 
diff --git a/src/Paket.Core/Utils.fs b/src/Paket.Core/Utils.fs
index cfc293172d..bbed94d386 100644
--- a/src/Paket.Core/Utils.fs
+++ b/src/Paket.Core/Utils.fs
@@ -46,7 +46,7 @@ let CleanDir path =
 /// [omit]
 let inline createRelativePath root path =
     let uri = Uri(if String.IsNullOrEmpty root then System.Environment.CurrentDirectory + Path.DirectorySeparatorChar.ToString() else root)
-    uri.MakeRelativeUri(Uri(path)).ToString().Replace("/", "\\")
+    uri.MakeRelativeUri(Uri(path)).ToString().Replace("/", "\\") |> Uri.UnescapeDataString
 
 /// [omit]
 let inline normalizeXml(doc:XmlDocument) =
diff --git a/tests/Paket.Tests/Paket.Tests.fsproj b/tests/Paket.Tests/Paket.Tests.fsproj
index 2d0adda0bd..94cf149912 100644
--- a/tests/Paket.Tests/Paket.Tests.fsproj
+++ b/tests/Paket.Tests/Paket.Tests.fsproj
@@ -75,6 +75,7 @@
     <Compile Include="NugetVersionRangeParserSpecs.fs" />
     <Compile Include="NugetVersionRangeSerializerSpecs.fs" />
     <Compile Include="BindingRedirect.fs" />
+    <Compile Include="UtilsSpecs.fs" />
     <Content Include="Nuspec\FSharp.Data.nuspec">
       <CopyToOutputDirectory>Always</CopyToOutputDirectory>
     </Content>
diff --git a/tests/Paket.Tests/UtilsSpecs.fs b/tests/Paket.Tests/UtilsSpecs.fs
new file mode 100644
index 0000000000..074471ac09
--- /dev/null
+++ b/tests/Paket.Tests/UtilsSpecs.fs
@@ -0,0 +1,9 @@
+module Paket.UtilsSpecs
+
+open Paket
+open NUnit.Framework
+open FsUnit
+
+[<Test>]
+let ``createRelativePath should handle spaces``() =
+    "C:/some file" |> createRelativePath "C:/a/b" |> shouldEqual "..\\some file"
\ No newline at end of file