diff --git a/documentation/wiki/ChangeWaves.md b/documentation/wiki/ChangeWaves.md
index a6fd5b23f0f..0503718715a 100644
--- a/documentation/wiki/ChangeWaves.md
+++ b/documentation/wiki/ChangeWaves.md
@@ -30,6 +30,7 @@ Change wave checks around features will be removed in the release that accompani
 ## Current Rotation of Change Waves
 
 ### 18.8
+- Use the Unix logical current directory from `PWD` when resolving relative project paths, so builds under symlinked directories produce logical project full paths and related output paths. Set `MSBUILDDISABLEFEATURESFROMVERSION=18.8` to opt out.
 - [RAR task: across multiple input properties, resolve relative paths against the project directory (not the process current directory)](https://github.com/dotnet/msbuild/pull/13319)
 - [Console, parallel console, and terminal loggers print the paths of log files written by registered loggers (e.g. file logger and binary logger) as part of the end-of-build summary.](https://github.com/dotnet/msbuild/pull/13577)
 
diff --git a/src/MSBuild.UnitTests/XMake_Tests.cs b/src/MSBuild.UnitTests/XMake_Tests.cs
index 7a12d44ea2c..a89eef4add8 100644
--- a/src/MSBuild.UnitTests/XMake_Tests.cs
+++ b/src/MSBuild.UnitTests/XMake_Tests.cs
@@ -1362,6 +1362,34 @@ public void ResponseFileInProjectDirectoryFoundImplicitly()
             output.ShouldContain("[A=1]");
         }
 
+        [UnixOnlyFact]
+        public void ResponseFileInLogicalProjectDirectoryFoundImplicitly()
+        {
+            string root = _env.CreateFolder().Path;
+            string realDirectory = Path.Combine(root, "repo", "project");
+            string logicalParentDirectory = Path.Combine(root, "links");
+            string linkDirectory = Path.Combine(logicalParentDirectory, "project");
+            Directory.CreateDirectory(realDirectory);
+            Directory.CreateDirectory(logicalParentDirectory);
+
+            string errorMessage = null;
+            NativeMethodsShared.MakeSymbolicLink(linkDirectory, realDirectory, ref errorMessage).ShouldBeTrue(errorMessage);
+
+            string content = ObjectModelHelpers.CleanupFileContents("<Project ToolsVersion='msbuilddefaulttoolsversion' xmlns='msbuildnamespace'><Target Name='t'><Warning Text='[A=$(A)]'/></Target></Project>");
+            File.WriteAllText(Path.Combine(realDirectory, "my.proj"), content);
+            File.WriteAllText(Path.Combine(root, "repo", "Directory.Build.rsp"), "/p:A=physical");
+            File.WriteAllText(Path.Combine(logicalParentDirectory, "Directory.Build.rsp"), "/p:A=logical");
+
+            _env.SetCurrentDirectory(linkDirectory);
+            _env.SetEnvironmentVariable("PWD", linkDirectory);
+
+            string output = RunnerUtilities.ExecMSBuild("my.proj", out var successfulExit, _output);
+            successfulExit.ShouldBeTrue();
+
+            output.ShouldContain("[A=logical]");
+            output.ShouldNotContain("[A=physical]");
+        }
+
         [Fact]
         public void ResponseFileSwitchesAppearInCommandLine()
         {
@@ -1915,6 +1943,113 @@ public void TestProcessProjectSwitchReplicateBuildingDFLKG()
             MSBuildApp.ProcessProjectSwitch(Array.Empty<string>(), extensionsToIgnore, projectHelper.GetFiles).ShouldBe("test.proj"); // "Expected test.proj to be only project found"
         }
 
+        [UnixOnlyFact]
+        public void ResolveProjectPathAgainstLogicalCurrentDirectoryPreservesSymlinkFromPwd()
+        {
+            string root = _env.CreateFolder().Path;
+            string realDirectory = Path.Combine(root, "real");
+            string linkDirectory = Path.Combine(root, "link");
+            Directory.CreateDirectory(realDirectory);
+
+            string errorMessage = null;
+            NativeMethodsShared.MakeSymbolicLink(linkDirectory, realDirectory, ref errorMessage).ShouldBeTrue(errorMessage);
+
+            _env.SetCurrentDirectory(linkDirectory);
+            _env.SetEnvironmentVariable("PWD", linkDirectory);
+
+            string relativeProjectPath = Path.Combine("MyApp", "MyApp.csproj");
+
+            MSBuildApp.ResolveProjectPathAgainstLogicalCurrentDirectory(relativeProjectPath)
+                .ShouldBe(Path.Combine(linkDirectory, relativeProjectPath));
+        }
+
+        [UnixOnlyFact]
+        public void ResolveProjectPathAgainstLogicalCurrentDirectoryCanBeDisabledByChangeWave()
+        {
+            string root = _env.CreateFolder().Path;
+            string realDirectory = Path.Combine(root, "real");
+            string linkDirectory = Path.Combine(root, "link");
+            Directory.CreateDirectory(realDirectory);
+
+            string errorMessage = null;
+            NativeMethodsShared.MakeSymbolicLink(linkDirectory, realDirectory, ref errorMessage).ShouldBeTrue(errorMessage);
+
+            _env.SetCurrentDirectory(linkDirectory);
+            _env.SetEnvironmentVariable("PWD", linkDirectory);
+            _env.SetEnvironmentVariable("MSBUILDDISABLEFEATURESFROMVERSION", ChangeWaves.Wave18_8.ToString());
+            ChangeWaves.ResetStateForTests();
+
+            string relativeProjectPath = Path.Combine("MyApp", "MyApp.csproj");
+
+            MSBuildApp.ResolveProjectPathAgainstLogicalCurrentDirectory(relativeProjectPath)
+                .ShouldBe(relativeProjectPath);
+        }
+
+        [UnixOnlyFact]
+        public void ResolveProjectPathAgainstLogicalCurrentDirectoryDoesNotRebaseToDifferentPhysicalPath()
+        {
+            string root = _env.CreateFolder().Path;
+            string realCurrentDirectory = Path.Combine(root, "repo", "current");
+            string realProjectDirectory = Path.Combine(root, "repo", "other");
+            string linkParentDirectory = Path.Combine(root, "links");
+            string linkDirectory = Path.Combine(linkParentDirectory, "link");
+            Directory.CreateDirectory(realCurrentDirectory);
+            Directory.CreateDirectory(realProjectDirectory);
+            Directory.CreateDirectory(linkParentDirectory);
+            File.WriteAllText(Path.Combine(realProjectDirectory, "MyApp.csproj"), "<Project />");
+
+            string errorMessage = null;
+            NativeMethodsShared.MakeSymbolicLink(linkDirectory, realCurrentDirectory, ref errorMessage).ShouldBeTrue(errorMessage);
+
+            _env.SetCurrentDirectory(linkDirectory);
+            _env.SetEnvironmentVariable("PWD", linkDirectory);
+
+            string relativeProjectPath = Path.Combine("..", "other", "MyApp.csproj");
+
+            MSBuildApp.ResolveProjectPathAgainstLogicalCurrentDirectory(relativeProjectPath)
+                .ShouldBe(relativeProjectPath);
+        }
+
+        [UnixOnlyFact]
+        public void ResolveProjectPathAgainstLogicalCurrentDirectoryPreservesSiblingPathThroughSymlink()
+        {
+            string root = _env.CreateFolder().Path;
+            string realDirectory = Path.Combine(root, "real");
+            string realAppDirectory = Path.Combine(realDirectory, "App");
+            string realLibDirectory = Path.Combine(realDirectory, "Lib");
+            string linkDirectory = Path.Combine(root, "link");
+            Directory.CreateDirectory(realAppDirectory);
+            Directory.CreateDirectory(realLibDirectory);
+            File.WriteAllText(Path.Combine(realLibDirectory, "Lib.csproj"), "<Project />");
+
+            string errorMessage = null;
+            NativeMethodsShared.MakeSymbolicLink(linkDirectory, realDirectory, ref errorMessage).ShouldBeTrue(errorMessage);
+
+            string logicalAppDirectory = Path.Combine(linkDirectory, "App");
+            _env.SetCurrentDirectory(logicalAppDirectory);
+            _env.SetEnvironmentVariable("PWD", logicalAppDirectory);
+
+            string relativeProjectPath = Path.Combine("..", "Lib", "Lib.csproj");
+
+            MSBuildApp.ResolveProjectPathAgainstLogicalCurrentDirectory(relativeProjectPath)
+                .ShouldBe(Path.Combine(linkDirectory, "Lib", "Lib.csproj"));
+        }
+
+        [UnixOnlyFact]
+        public void ResolveProjectPathAgainstLogicalCurrentDirectoryIgnoresMismatchedPwd()
+        {
+            string currentDirectory = _env.CreateFolder().Path;
+            string otherDirectory = _env.CreateFolder().Path;
+
+            _env.SetCurrentDirectory(currentDirectory);
+            _env.SetEnvironmentVariable("PWD", otherDirectory);
+
+            string relativeProjectPath = Path.Combine("MyApp", "MyApp.csproj");
+
+            MSBuildApp.ResolveProjectPathAgainstLogicalCurrentDirectory(relativeProjectPath)
+                .ShouldBe(relativeProjectPath);
+        }
+
         /// <summary>
         /// Test the case where we remove all of the project extensions that exist in the directory
         /// </summary>
diff --git a/src/MSBuild/CommandLine/CommandLineParser.cs b/src/MSBuild/CommandLine/CommandLineParser.cs
index 8a5802501ac..25aa30337f9 100644
--- a/src/MSBuild/CommandLine/CommandLineParser.cs
+++ b/src/MSBuild/CommandLine/CommandLineParser.cs
@@ -550,7 +550,7 @@ private static string GetProjectDirectory(string[] projectSwitchParameters)
 
             if (projectSwitchParameters.Length == 1)
             {
-                var projectFile = FileUtilities.FixFilePath(projectSwitchParameters[0]);
+                var projectFile = MSBuildApp.ResolveProjectPathAgainstLogicalCurrentDirectory(FileUtilities.FixFilePath(projectSwitchParameters[0]));
 
                 if (FileSystems.Default.DirectoryExists(projectFile))
                 {
@@ -563,6 +563,10 @@ private static string GetProjectDirectory(string[] projectSwitchParameters)
                     projectDirectory = Path.GetDirectoryName(Path.GetFullPath(projectFile));
                 }
             }
+            else
+            {
+                projectDirectory = MSBuildApp.ResolveProjectPathAgainstLogicalCurrentDirectory(projectDirectory);
+            }
 
             return projectDirectory;
         }
diff --git a/src/MSBuild/XMake.cs b/src/MSBuild/XMake.cs
index f726294145e..9f27e46d13c 100644
--- a/src/MSBuild/XMake.cs
+++ b/src/MSBuild/XMake.cs
@@ -361,7 +361,11 @@ private static bool CanRunServerBasedOnCommandLineSwitches(string[] commandLine)
                 {
                     commandLineSwitches = CombineSwitchesRespectingPriority(switchesFromAutoResponseFile, switchesNotFromAutoResponseFile, fullCommandLine);
                 }
-                string projectFile = ProcessProjectSwitch(commandLineSwitches[CommandLineSwitches.ParameterizedSwitch.Project], commandLineSwitches[CommandLineSwitches.ParameterizedSwitch.IgnoreProjectExtensions], Directory.GetFiles);
+                string projectFile = ResolveProjectPathAgainstLogicalCurrentDirectory(
+                    ProcessProjectSwitch(
+                        commandLineSwitches[CommandLineSwitches.ParameterizedSwitch.Project],
+                        commandLineSwitches[CommandLineSwitches.ParameterizedSwitch.IgnoreProjectExtensions],
+                        Directory.GetFiles));
                 if (commandLineSwitches[CommandLineSwitches.ParameterlessSwitch.Help] ||
                     commandLineSwitches.IsParameterizedSwitchSet(CommandLineSwitches.ParameterizedSwitch.NodeMode) ||
                     commandLineSwitches[CommandLineSwitches.ParameterlessSwitch.Version] ||
@@ -2225,7 +2229,11 @@ private static bool ProcessCommandLineSwitches(
                                                            commandLine);
                     }
 
-                    projectFile = ProcessProjectSwitch(commandLineSwitches[CommandLineSwitches.ParameterizedSwitch.Project], commandLineSwitches[CommandLineSwitches.ParameterizedSwitch.IgnoreProjectExtensions], Directory.GetFiles);
+                    projectFile = ResolveProjectPathAgainstLogicalCurrentDirectory(
+                        ProcessProjectSwitch(
+                            commandLineSwitches[CommandLineSwitches.ParameterizedSwitch.Project],
+                            commandLineSwitches[CommandLineSwitches.ParameterizedSwitch.IgnoreProjectExtensions],
+                            Directory.GetFiles));
 
                     // figure out which targets we are building
                     targets = ProcessTargetSwitch(commandLineSwitches[CommandLineSwitches.ParameterizedSwitch.Target]);
@@ -3239,6 +3247,104 @@ internal static string ProcessProjectSwitch(
             return projectFile;
         }
 
+        /// <summary>
+        /// On Unix, rebases a relative project path onto the shell's logical working directory (<c>$PWD</c>)
+        /// when <c>$PWD</c> physically resolves to the same directory as <see cref="Directory.GetCurrentDirectory"/>.
+        /// This makes MSBuild produce the same <c>$(MSBuildProjectFullPath)</c> (and therefore the same
+        /// intermediate/output paths) regardless of whether the user reached the project via an absolute path
+        /// through a symlink or via a relative path under a symlinked working directory.
+        /// </summary>
+        /// <remarks>
+        /// No-op on Windows (where <c>GetCurrentDirectory</c> already returns the as-typed path), when
+        /// <paramref name="projectFile"/> is absolute, when <c>PWD</c> is unset/relative, or when <c>PWD</c>'s
+        /// physical target differs from <c>getcwd()</c> (defense against a stale or mismatched <c>PWD</c>).
+        /// Gated by <see cref="ChangeWaves.Wave18_8"/> so users can opt out via
+        /// <c>MSBuildDisableFeaturesFromVersion</c> if the change breaks an existing workflow.
+        /// </remarks>
+        internal static string ResolveProjectPathAgainstLogicalCurrentDirectory(string projectFile)
+        {
+            if (!ChangeWaves.AreFeaturesEnabled(ChangeWaves.Wave18_8)
+                || NativeMethodsShared.IsWindows
+                || string.IsNullOrEmpty(projectFile)
+                || Path.IsPathRooted(projectFile))
+            {
+                return projectFile;
+            }
+
+            string logicalCurrentDirectory = Environment.GetEnvironmentVariable("PWD");
+            if (string.IsNullOrEmpty(logicalCurrentDirectory) || !Path.IsPathRooted(logicalCurrentDirectory))
+            {
+                return projectFile;
+            }
+
+            string currentDirectory = Directory.GetCurrentDirectory();
+            if (!IsSamePhysicalDirectory(logicalCurrentDirectory, currentDirectory))
+            {
+                return projectFile;
+            }
+
+            string logicalProjectFile = Path.GetFullPath(Path.Combine(logicalCurrentDirectory, projectFile));
+
+            // A relative path without ".." segments can never lexically escape the shared physical prefix,
+            // so rebasing onto PWD is always safe. With ".." segments, lexical normalization may collapse
+            // the path above the prefix before any symlink resolution happens, so the logical and physical
+            // resolutions can land on different files. In that case, only rebase when both resolutions
+            // refer to the same physical target.
+            if (projectFile.Split(Path.DirectorySeparatorChar, Path.AltDirectorySeparatorChar).Contains(".."))
+            {
+                string currentProjectFile = Path.GetFullPath(projectFile);
+                if (!IsSamePhysicalPath(logicalProjectFile, currentProjectFile))
+                {
+                    return projectFile;
+                }
+            }
+
+            return logicalProjectFile;
+        }
+
+        private static bool IsSamePhysicalPath(string firstPath, string secondPath)
+        {
+            if (FileSystems.Default.DirectoryExists(firstPath) && FileSystems.Default.DirectoryExists(secondPath))
+            {
+                return IsSamePhysicalDirectory(firstPath, secondPath);
+            }
+
+            if (FileSystems.Default.FileExists(firstPath) && FileSystems.Default.FileExists(secondPath))
+            {
+                string firstDirectory = Path.GetDirectoryName(firstPath);
+                string secondDirectory = Path.GetDirectoryName(secondPath);
+
+                return string.Equals(Path.GetFileName(firstPath), Path.GetFileName(secondPath), StringComparison.Ordinal) &&
+                    IsSamePhysicalDirectory(firstDirectory, secondDirectory);
+            }
+
+            return false;
+        }
+
+        // Compares two directories for physical-path equivalence by canonicalizing each through getcwd().
+        // .NET does not expose POSIX realpath(3), and Path.GetFullPath only normalizes lexically (does not
+        // resolve symlinks). Mutating the process cwd is safe here because callers run on the single-threaded
+        // command-line parsing path before any build worker threads or child processes are started.
+        private static bool IsSamePhysicalDirectory(string firstDirectory, string secondDirectory)
+        {
+            string savedCurrentDirectory = Directory.GetCurrentDirectory();
+            try
+            {
+                Directory.SetCurrentDirectory(firstDirectory);
+                string resolvedFirstDirectory = Directory.GetCurrentDirectory();
+                Directory.SetCurrentDirectory(secondDirectory);
+                return string.Equals(Directory.GetCurrentDirectory(), resolvedFirstDirectory, StringComparison.Ordinal);
+            }
+            catch (Exception ex) when (ExceptionHandling.IsIoRelatedException(ex))
+            {
+                return false;
+            }
+            finally
+            {
+                Directory.SetCurrentDirectory(savedCurrentDirectory);
+            }
+        }
+
         private static void ValidateExtensions(string[] projectExtensionsToIgnore)
         {
             if (projectExtensionsToIgnore?.Length > 0)