diff --git a/src/spec-node/dockerCompose.ts b/src/spec-node/dockerCompose.ts
index de1ed35b0..da24c1981 100644
--- a/src/spec-node/dockerCompose.ts
+++ b/src/spec-node/dockerCompose.ts
@@ -541,7 +541,7 @@ while sleep 1 & wait $$!; do :; done", "-"${userEntrypoint.map(a => `, ${JSON.st
     security_opt:${securityOpts.map(securityOpt => `
       - ${securityOpt}`).join('')}` : ''}${additionalLabels.length ? `
     labels:${additionalLabels.map(label => `
-      - ${label.replace(/\$/g, '$$$$')}`).join('')}` : ''}${mounts.length ? `
+      - '${label.replace(/\$/g, '$$$$').replace(/'/g, '\'\'')}'`).join('')}` : ''}${mounts.length ? `
     volumes:${mounts.map(m => `
       - ${m.source}:${m.target}`).join('')}` : ''}${gpuResources}${volumeMounts.length ? `
 volumes:${volumeMounts.map(m => `
diff --git a/src/test/configs/compose-image-without-features-minimal/.devcontainer/devcontainer.json b/src/test/configs/compose-image-without-features-minimal/.devcontainer/devcontainer.json
index 0d78429ce..c681c45dd 100644
--- a/src/test/configs/compose-image-without-features-minimal/.devcontainer/devcontainer.json
+++ b/src/test/configs/compose-image-without-features-minimal/.devcontainer/devcontainer.json
@@ -4,6 +4,7 @@
 	"workspaceFolder": "/workspace",
 	"postCreateCommand": "touch /postCreateCommand.txt",
 	"remoteEnv": {
-		"TEST": "ENV"
+		"TEST": "ENV",
+		"TEST_ESCAPING": "{\n  \"fo$o\": \"ba'r\"\n}"
 	}
 }
\ No newline at end of file
diff --git a/src/test/configs/image/.devcontainer.json b/src/test/configs/image/.devcontainer.json
index 0cb2f1701..b33c8035c 100644
--- a/src/test/configs/image/.devcontainer.json
+++ b/src/test/configs/image/.devcontainer.json
@@ -2,6 +2,8 @@
 	"image": "ubuntu:latest",
 	"postCreateCommand": "touch /postCreateCommand.txt",
 	"remoteEnv": {
+		"TEST": "ENV",
+		"TEST_ESCAPING": "{\n  \"fo$o\": \"ba'r\"\n}",
 		"LOCAL_PATH": "${localEnv:PATH}",
 		"CONTAINER_PATH": "${containerEnv:PATH}"
 	}
diff --git a/src/test/imageMetadata.test.ts b/src/test/imageMetadata.test.ts
index 5c7dc547f..c94ee3eb2 100644
--- a/src/test/imageMetadata.test.ts
+++ b/src/test/imageMetadata.test.ts
@@ -156,6 +156,8 @@ describe('Image Metadata', function () {
 					const metadata = internalGetImageMetadata0(details, true, nullLog);
 					assert.strictEqual(metadata.length, 1);
 					assert.ok(metadata[0].remoteEnv);
+					assert.strictEqual(metadata[0].remoteEnv.TEST, 'ENV');
+					assert.strictEqual(metadata[0].remoteEnv.TEST_ESCAPING, '{\n  "fo$o": "ba\'r"\n}');
 					await shellExec(`docker exec ${response.containerId} test -f /postCreateCommand.txt`);
 					await shellExec(`docker rm -f ${response.containerId}`);
 				});