diff --git a/extensions/positron-supervisor/resources/supervisor-wrapper.bat b/extensions/positron-supervisor/resources/supervisor-wrapper.bat
index 3b8d7c02fec6..d1c6fdd71b1c 100644
--- a/extensions/positron-supervisor/resources/supervisor-wrapper.bat
+++ b/extensions/positron-supervisor/resources/supervisor-wrapper.bat
@@ -18,7 +18,7 @@ if "%~2"=="" (
 )
 
 REM The first argument is the output file; consume it.
-set output_file=%1
+set "output_file=%~1"
 shift
 
 REM `shift` doesn't affect `%*`, so we have to manually remove the first argument
diff --git a/extensions/positron-supervisor/src/KallichoreAdapterApi.ts b/extensions/positron-supervisor/src/KallichoreAdapterApi.ts
index 81e49d78a80b..84a63f3277ee 100644
--- a/extensions/positron-supervisor/src/KallichoreAdapterApi.ts
+++ b/extensions/positron-supervisor/src/KallichoreAdapterApi.ts
@@ -578,7 +578,14 @@ export class KCApi implements PositronSupervisorApi {
 				wrapperPath = 'powershell.exe';
 				// Build the arguments for the wrapper script
 				const escapedWrapper = kernelWrapper.replace(/'/g, "''");
-				const escapedArgs = shellArgs.map(arg => `'${arg.replace(/'/g, "''")}'`).join(', ');
+				const escapedArgs = shellArgs.map(arg => {
+					const escapedArg = arg.replace(/'/g, "''");
+					// Start-Process joins -ArgumentList elements with spaces when
+					// building the cmd.exe command line for .bat invocation. Wrap
+					// args that contain spaces in double-quotes so cmd.exe treats
+					// them as single tokens.
+					return arg.includes(' ') ? `'"${escapedArg}"'` : `'${escapedArg}'`;
+				}).join(', ');
 				shellArgs = [
 					'-WindowStyle', 'Hidden',
 					'-Command',