diff --git a/.changeset/sigv4-path-encoding.md b/.changeset/sigv4-path-encoding.md
new file mode 100644
index 0000000..38ab155
--- /dev/null
+++ b/.changeset/sigv4-path-encoding.md
@@ -0,0 +1,12 @@
+---
+'@tigrisdata/storage': patch
+---
+
+Fix `403 SignatureDoesNotMatch` from `copy`, `move`, and `updateObject` when the object key contains `/` or any other character that requires percent-encoding (space, `?`, `=`, etc.) and the request is signed with access-key SigV4.
+
+Two related fixes:
+
+- Custom HTTP client now constructs `SignatureV4` with `uriEscapePath: false`, matching S3's single-encoding canonical-path scheme. The default `true` (AWS-standard double-encoding) caused the signer to re-escape any percent sequence in the path during canonicalization, while Tigris gateway uses S3 single-encoding — producing the mismatch for every key with a special char.
+- Object keys in the request path and `X-Amz-Copy-Source` header are URL-encoded per-segment via the new `encodeObjectKey` helper, preserving `/` as a separator so the wire URL stays valid.
+
+OAuth/session-token callers were unaffected because that auth path skips SigV4 signing entirely.
diff --git a/AGENTS.md b/AGENTS.md
index f9bcad0..07cbf04 100644
--- a/AGENTS.md
+++ b/AGENTS.md
@@ -108,3 +108,87 @@ Root-level scripts:
 - The project uses Husky for Git hooks (commitlint via `commit-msg`, Biome `check` via `pre-commit`).
 - Commitizen is configured for Conventional Commits (`pnpm commit`).
 - Biome handles linting and formatting (replaced ESLint and Prettier).
+
+## Known pitfalls
+
+### SigV4 path encoding for object keys
+
+Scope: this only applies to code that talks to the **custom HTTP
+client** in `shared/http-client.ts` (used by `copy`, `move`,
+`updateObject`, and the `setBucket*` family). Anything routed through
+the AWS SDK (`ListObjectsV2Command`, `PutObjectCommand`,
+`HeadObjectCommand`, `GetObjectCommand`, `RemoveObjectCommand`, etc.)
+handles its own SigV4 correctly — don't touch encoding there.
+
+**Rule for the custom client**: whenever you build a **request path**
+that embeds an object key, do **not** encode the whole key with
+`encodeURIComponent`. Use `encodeObjectKey` from `@shared/utils`
+instead.
+
+Why the path specifically: there are two encoding traps that compound.
+
+1. **Signer setting**: `@smithy/signature-v4`'s `SignatureV4`
+   constructor defaults `uriEscapePath: true` — the AWS-standard
+   double-encoding scheme. S3 uses single-encoding, so our custom HTTP
+   client passes `uriEscapePath: false`. If you ever build a second
+   signer instance, set the same flag. With the default, the signer
+   re-percent-encodes any sequence in the path during canonicalization
+   (`%20` → `%2520`), and Tigris gateway — which uses S3 single-encoding
+   — diverges from the client canonical and returns
+   `403 SignatureDoesNotMatch` for every key with a special char.
+2. **Pre-encoding**: even with `uriEscapePath: false`, the wire URL
+   must still be a valid URL — keys with `/`, spaces, `?`, etc. need
+   percent-encoding when serialized. Use `encodeObjectKey` (single
+   encode, per-segment, preserves `/`) so the on-wire path is valid
+   and matches what the signer signs.
+
+**Other surfaces — not affected by the double-encode bug but worth
+knowing**:
+
+- **Query strings**: the HTTP client extracts query params via
+  `URL.searchParams.forEach`, which returns the **decoded** value
+  before handing it to the signer. The signer encodes once for the
+  canonical query string, the server canonicalizes the same way —
+  single encoding round-trip. Writing `?prefix=${encodeURIComponent(p)}`
+  is safe; so is writing the value raw and letting `URL` percent-encode
+  it.
+- **Header values**: SigV4's canonical-header construction does not
+  URL-escape header values (only trims and collapses whitespace), so
+  there's no double-encode mismatch. However, S3's
+  `X-Amz-Copy-Source` spec **requires** the value be URL-encoded; the
+  server URL-decodes it before treating it as a key. Use
+  `encodeObjectKey` there too — it gives you the spec-correct encoding
+  for free (special chars escaped, `/` separators preserved).
+
+Symptoms that point at this bug:
+
+- `403 Forbidden` with body `<Code>SignatureDoesNotMatch</Code>` for
+  requests that include a nested object key (key contains `/`).
+- Works fine in tests that mock the network or run with OAuth/session
+  tokens (those skip the SigV4 branch entirely — see
+  `shared/http-client.ts`), then fails the first time a real consumer
+  exercises the call with access keys.
+- A previously-fine flat key like `file.txt` succeeds, but
+  `folder/file.txt` 403s.
+
+Mitigation for new code:
+
+```ts
+import { encodeObjectKey } from '@shared/utils';
+
+path: `/${bucket}/${encodeObjectKey(key)}?x-id=...`,
+headers: {
+  [TigrisHeaders.COPY_SOURCE]: `${srcBucket}/${encodeObjectKey(src)}`,
+}
+```
+
+When adding tests for any function that hits the custom HTTP client,
+exercise at least these two key shapes against the real gateway with
+access-key auth:
+
+- A key with `/` (e.g. `folder/file.txt`) — catches the per-segment
+  encoding regression.
+- A key with a character that requires percent-encoding (space, `?`,
+  `=`, `&`) — catches the `uriEscapePath` regression. Unit tests on
+  `encodeObjectKey` alone aren't enough; the bug only shows up when
+  the signer's canonicalization pass runs end-to-end.
diff --git a/packages/storage/src/lib/object/copy.ts b/packages/storage/src/lib/object/copy.ts
index 97529c8..e6709ea 100644
--- a/packages/storage/src/lib/object/copy.ts
+++ b/packages/storage/src/lib/object/copy.ts
@@ -1,5 +1,5 @@
 import { TigrisHeaders } from '@shared/headers';
-import { handleError } from '@shared/utils';
+import { encodeObjectKey, handleError } from '@shared/utils';
 import { config, missingConfigError } from '../config';
 import { createStorageClient } from '../http-client';
 import type { TigrisStorageConfig, TigrisStorageResponse } from '../types';
@@ -56,7 +56,7 @@ export async function copyOrMove(
   }
 
   const headers: Record<string, string> = {
-    [TigrisHeaders.COPY_SOURCE]: `${srcBucket}/${encodeURIComponent(src)}`,
+    [TigrisHeaders.COPY_SOURCE]: `${srcBucket}/${encodeObjectKey(src)}`,
   };
 
   if (rename) {
@@ -66,7 +66,7 @@ export async function copyOrMove(
   try {
     const response = await storageHttpClient.request({
       method: 'PUT',
-      path: `/${destBucket}/${encodeURIComponent(dest)}?x-id=CopyObject`,
+      path: `/${destBucket}/${encodeObjectKey(dest)}?x-id=CopyObject`,
       headers,
     });
 
diff --git a/packages/storage/src/lib/object/update.ts b/packages/storage/src/lib/object/update.ts
index e239f6c..74a2f1c 100644
--- a/packages/storage/src/lib/object/update.ts
+++ b/packages/storage/src/lib/object/update.ts
@@ -1,6 +1,6 @@
 import { PutObjectAclCommand } from '@aws-sdk/client-s3';
 import { TigrisHeaders } from '@shared/headers';
-import { handleError } from '@shared/utils';
+import { encodeObjectKey, handleError } from '@shared/utils';
 import { config, missingConfigError } from '../config';
 import { createStorageClient } from '../http-client';
 import { createTigrisClient } from '../tigris-client';
@@ -50,9 +50,9 @@ export async function updateObject(
     try {
       const response = await storageHttpClient.request({
         method: 'PUT',
-        path: `/${bucket}/${encodeURIComponent(key)}?x-id=CopyObject`,
+        path: `/${bucket}/${encodeObjectKey(key)}?x-id=CopyObject`,
         headers: {
-          [TigrisHeaders.COPY_SOURCE]: `${bucket}/${encodeURIComponent(path)}`,
+          [TigrisHeaders.COPY_SOURCE]: `${bucket}/${encodeObjectKey(path)}`,
           [TigrisHeaders.RENAME]: 'true',
         },
       });
diff --git a/shared/http-client.ts b/shared/http-client.ts
index 30b4bf0..7325d1b 100644
--- a/shared/http-client.ts
+++ b/shared/http-client.ts
@@ -64,6 +64,11 @@ async function generateSignatureHeaders(
     region: 'auto',
     service: 's3',
     sha256: Sha256,
+    // S3 uses single-encoding for the canonical path; the default
+    // (`true`) is the AWS-standard double-encoding scheme and produces
+    // `SignatureDoesNotMatch` whenever a path segment contains
+    // characters that need percent-encoding (space, `?`, `=`, etc.).
+    uriEscapePath: false,
   });
 
   const query: Record<string, string> = {};
diff --git a/shared/utils.test.ts b/shared/utils.test.ts
index 066f2cd..fcd4033 100644
--- a/shared/utils.test.ts
+++ b/shared/utils.test.ts
@@ -1,5 +1,5 @@
 import { describe, expect, it } from 'vitest';
-import { executeWithConcurrency } from './utils';
+import { encodeObjectKey, executeWithConcurrency } from './utils';
 
 describe('executeWithConcurrency', () => {
   it('should execute all tasks and return results in order', async () => {
@@ -136,3 +136,32 @@ describe('executeWithConcurrency', () => {
     expect(executionOrder).toEqual([1, 2, 3]);
   });
 });
+
+describe('encodeObjectKey', () => {
+  it('encodes a flat key with no slashes', () => {
+    expect(encodeObjectKey('file.txt')).toBe('file.txt');
+  });
+
+  it('preserves slashes as path separators', () => {
+    // Regression: a plain `encodeURIComponent` turns `/` into `%2F`,
+    // which the SigV4 signer then double-encodes to `%252F` during
+    // canonical-request construction, producing SignatureDoesNotMatch.
+    expect(encodeObjectKey('folder/file.txt')).toBe('folder/file.txt');
+    expect(encodeObjectKey('a/b/c/d.txt')).toBe('a/b/c/d.txt');
+  });
+
+  it('encodes special characters within segments', () => {
+    expect(encodeObjectKey('folder/my file.txt')).toBe('folder/my%20file.txt');
+    expect(encodeObjectKey('folder/?weird=name.txt')).toBe(
+      'folder/%3Fweird%3Dname.txt'
+    );
+  });
+
+  it('preserves trailing slash (folder markers)', () => {
+    expect(encodeObjectKey('folder/')).toBe('folder/');
+  });
+
+  it('handles empty input', () => {
+    expect(encodeObjectKey('')).toBe('');
+  });
+});
diff --git a/shared/utils.ts b/shared/utils.ts
index 1e53325..b73757d 100644
--- a/shared/utils.ts
+++ b/shared/utils.ts
@@ -31,6 +31,23 @@ export async function executeWithConcurrency<T>(
   return results;
 }
 
+/**
+ * Encode an object key for use in an S3-style request path or
+ * `X-Amz-Copy-Source` header. Encodes each path segment with
+ * `encodeURIComponent` and rejoins with `/`, so the slash separators
+ * survive verbatim.
+ *
+ * Why this matters: when the request is signed with SigV4 (access-key
+ * auth path), the signer URI-escapes the path again during canonical
+ * request construction. If the key was already escaped with a plain
+ * `encodeURIComponent`, the `/` becomes `%2F` and then `%252F` —
+ * mismatch against the server's canonical (which decodes `%2F`
+ * back to `/` first). Result: `SignatureDoesNotMatch`.
+ */
+export function encodeObjectKey(key: string): string {
+  return key.split('/').map(encodeURIComponent).join('/');
+}
+
 export function toError(value: unknown): Error {
   if (value instanceof Error) return value;
   if (typeof value === 'string') return new Error(value);