diff --git a/cli/config/configfile/file.go b/cli/config/configfile/file.go
index ae9dcb3370..c9652118f4 100644
--- a/cli/config/configfile/file.go
+++ b/cli/config/configfile/file.go
@@ -167,10 +167,13 @@ func (configFile *ConfigFile) Save() (retErr error) {
 		return errors.Wrap(err, "error closing temp file")
 	}
 
-	// Handle situation where the configfile is a symlink
+	// Handle situation where the configfile is a symlink, and allow for dangling symlinks
 	cfgFile := configFile.Filename
-	if f, err := os.Readlink(cfgFile); err == nil {
+	if f, err := filepath.EvalSymlinks(cfgFile); err == nil {
 		cfgFile = f
+	} else if os.IsNotExist(err) {
+		// extract the path from the error if the configfile does not exist or is a dangling symlink
+		cfgFile = err.(*os.PathError).Path
 	}
 
 	// Try copying the current config file (if any) ownership and permissions
diff --git a/cli/config/configfile/file_test.go b/cli/config/configfile/file_test.go
index 51aac67964..68a10e0f7b 100644
--- a/cli/config/configfile/file_test.go
+++ b/cli/config/configfile/file_test.go
@@ -538,6 +538,34 @@ func TestSaveWithSymlink(t *testing.T) {
 	assert.Check(t, is.Equal(string(cfg), "{\n	\"auths\": {}\n}"))
 }
 
+func TestSaveWithRelativeSymlink(t *testing.T) {
+	dir := fs.NewDir(t, t.Name(), fs.WithFile("real-config.json", `{}`))
+	defer dir.Remove()
+
+	symLink := dir.Join("config.json")
+	relativeRealFile := "real-config.json"
+	realFile := dir.Join(relativeRealFile)
+	err := os.Symlink(relativeRealFile, symLink)
+	assert.NilError(t, err)
+
+	configFile := New(symLink)
+
+	err = configFile.Save()
+	assert.NilError(t, err)
+
+	fi, err := os.Lstat(symLink)
+	assert.NilError(t, err)
+	assert.Assert(t, fi.Mode()&os.ModeSymlink != 0, "expected %s to be a symlink", symLink)
+
+	cfg, err := os.ReadFile(symLink)
+	assert.NilError(t, err)
+	assert.Check(t, is.Equal(string(cfg), "{\n	\"auths\": {}\n}"))
+
+	cfg, err = os.ReadFile(realFile)
+	assert.NilError(t, err)
+	assert.Check(t, is.Equal(string(cfg), "{\n	\"auths\": {}\n}"))
+}
+
 func TestPluginConfig(t *testing.T) {
 	configFile := New("test-plugin")
 	defer os.Remove("test-plugin")