diff --git a/cmd/loki/loki-local-config.yaml b/cmd/loki/loki-local-config.yaml
index 529644b304cfb..f1cf3d00734b5 100644
--- a/cmd/loki/loki-local-config.yaml
+++ b/cmd/loki/loki-local-config.yaml
@@ -39,6 +39,7 @@ storage_config:
     shared_store: filesystem
   filesystem:
     directory: /tmp/loki/chunks
+    tenant_folders: true
 
 compactor:
   working_directory: /tmp/loki/boltdb-shipper-compactor
diff --git a/docs/sources/configuration/_index.md b/docs/sources/configuration/_index.md
index e9351ba10f9ff..a71ae3e1a94eb 100644
--- a/docs/sources/configuration/_index.md
+++ b/docs/sources/configuration/_index.md
@@ -1429,6 +1429,9 @@ filesystem:
   # Directory to store chunks in.
   # CLI flag: -local.chunk-directory
   directory: <string>
+  # Store chunks in per-tenant folders.
+  # CLI flag: -local.chunk-tenant-folders
+  [tenant_folders: <boolean> | default = false]
 
 # Configures storing index in an Object Store(GCS/S3/Azure/Swift/Filesystem) in the form of boltdb files.
 # Required fields only required when boltdb-shipper is defined in config.
diff --git a/docs/sources/operations/storage/filesystem.md b/docs/sources/operations/storage/filesystem.md
index 95d0cda2c5222..a6b939c6f119e 100644
--- a/docs/sources/operations/storage/filesystem.md
+++ b/docs/sources/operations/storage/filesystem.md
@@ -13,9 +13,10 @@ storage_config:
     directory: /tmp/loki/
 ```
 
-A folder is created for every tenant all the chunks for one tenant are stored in that directory.
+By default all chunks are stored in the given directory.
+Set `tenant_folders` to true to separate chunks of tenants into their own folders.
 
-If loki is run in single-tenant mode, all the chunks are put in a folder named `fake` which is the synthesized tenant name used for single tenant mode.
+If Loki is run in single-tenant mode, the synthesized tenant name `fake` is used for all chunks.
 
 See [multi-tenancy](../../multi-tenancy/) for more information.
 
diff --git a/pkg/storage/chunk/aws/fixtures.go b/pkg/storage/chunk/aws/fixtures.go
index 36aa4eefe395e..76b687c0a5e49 100644
--- a/pkg/storage/chunk/aws/fixtures.go
+++ b/pkg/storage/chunk/aws/fixtures.go
@@ -44,7 +44,7 @@ var Fixtures = []testutils.Fixture{
 				schemaCfg:               schemaConfig,
 				metrics:                 newMetrics(nil),
 			}
-			object := objectclient.NewClient(&S3ObjectClient{S3: newMockS3()}, nil)
+			object := objectclient.NewClient(&S3ObjectClient{S3: newMockS3()})
 			return index, object, table, schemaConfig, testutils.CloserFunc(func() error {
 				table.Stop()
 				index.Stop()
diff --git a/pkg/storage/chunk/gcp/fixtures.go b/pkg/storage/chunk/gcp/fixtures.go
index 9b525490c386c..7393ae6762be8 100644
--- a/pkg/storage/chunk/gcp/fixtures.go
+++ b/pkg/storage/chunk/gcp/fixtures.go
@@ -78,7 +78,7 @@ func (f *fixture) Clients() (
 	}
 
 	if f.gcsObjectClient {
-		cClient = objectclient.NewClient(newGCSObjectClient(GCSConfig{BucketName: "chunks"}, f.gcssrv.Client()), nil)
+		cClient = objectclient.NewClient(newGCSObjectClient(GCSConfig{BucketName: "chunks"}, f.gcssrv.Client()))
 	} else {
 		cClient = newBigtableObjectClient(Config{}, schemaConfig, client)
 	}
diff --git a/pkg/storage/chunk/local/fixtures.go b/pkg/storage/chunk/local/fixtures.go
index d2703808c2797..98e84e75a5c24 100644
--- a/pkg/storage/chunk/local/fixtures.go
+++ b/pkg/storage/chunk/local/fixtures.go
@@ -43,7 +43,7 @@ func (f *fixture) Clients() (
 		return
 	}
 
-	chunkClient = objectclient.NewClient(oClient, objectclient.Base64Encoder)
+	chunkClient = objectclient.NewClient(oClient)
 
 	tableClient, err = NewTableClient(f.dirname)
 	if err != nil {
diff --git a/pkg/storage/chunk/local/fs_object_client.go b/pkg/storage/chunk/local/fs_object_client.go
index 6f733110c72ad..16e99a881fddd 100644
--- a/pkg/storage/chunk/local/fs_object_client.go
+++ b/pkg/storage/chunk/local/fs_object_client.go
@@ -16,12 +16,14 @@ import (
 	util_log "github.com/cortexproject/cortex/pkg/util/log"
 
 	"github.com/grafana/loki/pkg/storage/chunk"
+	"github.com/grafana/loki/pkg/storage/chunk/objectclient"
 	"github.com/grafana/loki/pkg/storage/chunk/util"
 )
 
 // FSConfig is the config for a FSObjectClient.
 type FSConfig struct {
-	Directory string `yaml:"directory"`
+	Directory     string `yaml:"directory"`
+	TenantFolders bool   `yaml:"tenant_folders"`
 }
 
 // RegisterFlags registers flags.
@@ -32,6 +34,7 @@ func (cfg *FSConfig) RegisterFlags(f *flag.FlagSet) {
 // RegisterFlags registers flags with prefix.
 func (cfg *FSConfig) RegisterFlagsWithPrefix(prefix string, f *flag.FlagSet) {
 	f.StringVar(&cfg.Directory, prefix+"local.chunk-directory", "", "Directory to store chunks in.")
+	f.BoolVar(&cfg.TenantFolders, prefix+"local.chunk-tenant-folders", false, "Store chunks in per-tenant folders")
 }
 
 // FSObjectClient holds config for filesystem as object store
@@ -59,6 +62,13 @@ func NewFSObjectClient(cfg FSConfig) (*FSObjectClient, error) {
 // Stop implements ObjectClient
 func (FSObjectClient) Stop() {}
 
+func (f *FSObjectClient) KeyEncoder() chunk.KeyEncoder {
+	if f.cfg.TenantFolders {
+		return objectclient.SlashBase64Encoder
+	}
+	return objectclient.Base64Encoder
+}
+
 // GetObject from the store
 func (f *FSObjectClient) GetObject(_ context.Context, objectKey string) (io.ReadCloser, error) {
 	fl, err := os.Open(filepath.Join(f.cfg.Directory, filepath.FromSlash(objectKey)))
diff --git a/pkg/storage/chunk/local/fs_object_client_test.go b/pkg/storage/chunk/local/fs_object_client_test.go
index 1e3537377141a..6a3d4b69c18f2 100644
--- a/pkg/storage/chunk/local/fs_object_client_test.go
+++ b/pkg/storage/chunk/local/fs_object_client_test.go
@@ -16,14 +16,15 @@ import (
 	"github.com/grafana/loki/pkg/storage/chunk/util"
 )
 
-func TestFSObjectClient_DeleteChunksBefore(t *testing.T) {
+func deleteChunksBefore(t *testing.T, tenantFolders bool) {
 	deleteFilesOlderThan := 10 * time.Minute
 
 	fsChunksDir, err := ioutil.TempDir(os.TempDir(), "fs-chunks")
 	require.NoError(t, err)
 
 	bucketClient, err := NewFSObjectClient(FSConfig{
-		Directory: fsChunksDir,
+		Directory:     fsChunksDir,
+		TenantFolders: tenantFolders,
 	})
 	require.NoError(t, err)
 
@@ -63,12 +64,18 @@ func TestFSObjectClient_DeleteChunksBefore(t *testing.T) {
 	require.Equal(t, 1, len(files), "Number of files should be 1 after enforcing retention")
 }
 
-func TestFSObjectClient_List(t *testing.T) {
+func TestFSObjectClient_DeleteChunksBefore(t *testing.T) {
+	deleteChunksBefore(t, false)
+	deleteChunksBefore(t, true)
+}
+
+func list(t *testing.T, tenantFolders bool) {
 	fsObjectsDir, err := ioutil.TempDir(os.TempDir(), "fs-objects")
 	require.NoError(t, err)
 
 	bucketClient, err := NewFSObjectClient(FSConfig{
-		Directory: fsObjectsDir,
+		Directory:     fsObjectsDir,
+		TenantFolders: tenantFolders,
 	})
 	require.NoError(t, err)
 
@@ -165,12 +172,18 @@ func TestFSObjectClient_List(t *testing.T) {
 	require.Empty(t, commonPrefixes)
 }
 
-func TestFSObjectClient_DeleteObject(t *testing.T) {
+func TestFSObjectClient_List(t *testing.T) {
+	list(t, false)
+	list(t, true)
+}
+
+func deleteObject(t *testing.T, tenantFolders bool) {
 	fsObjectsDir, err := ioutil.TempDir(os.TempDir(), "fs-delete-object")
 	require.NoError(t, err)
 
 	bucketClient, err := NewFSObjectClient(FSConfig{
-		Directory: fsObjectsDir,
+		Directory:     fsObjectsDir,
+		TenantFolders: tenantFolders,
 	})
 	require.NoError(t, err)
 
@@ -215,3 +228,8 @@ func TestFSObjectClient_DeleteObject(t *testing.T) {
 	require.Len(t, commonPrefixes, 0)
 	require.Len(t, files, len(foldersWithFiles["folder2/"]))*/
 }
+
+func TestFSObjectClient_DeleteObject(t *testing.T) {
+	deleteObject(t, false)
+	deleteObject(t, true)
+}
diff --git a/pkg/storage/chunk/objectclient/client.go b/pkg/storage/chunk/objectclient/client.go
index 395b5f41cbad6..592541c787878 100644
--- a/pkg/storage/chunk/objectclient/client.go
+++ b/pkg/storage/chunk/objectclient/client.go
@@ -5,6 +5,7 @@ import (
 	"context"
 	"encoding/base64"
 	"io/ioutil"
+	"strings"
 
 	"github.com/pkg/errors"
 
@@ -12,24 +13,37 @@ import (
 	"github.com/grafana/loki/pkg/storage/chunk/util"
 )
 
-// KeyEncoder is used to encode chunk keys before writing/retrieving chunks
-// from the underlying ObjectClient
-type KeyEncoder func(string) string
-
 // Base64Encoder is used to encode chunk keys in base64 before storing/retrieving
 // them from the ObjectClient
 var Base64Encoder = func(key string) string {
 	return base64.StdEncoding.EncodeToString([]byte(key))
 }
 
+// SlashBase64Encoder is a variation of Base64Encoder that preserves all "/"
+// in the key by base64 encoding the strings separately
+var SlashBase64Encoder = func(key string) string {
+	parts := bytes.Split([]byte(key), []byte("/"))
+	ret := make([]string, len(parts))
+	for i, part := range parts {
+		ret[i] = base64.URLEncoding.EncodeToString(part)
+	}
+	return strings.Join(ret, "/")
+
+}
+
 // Client is used to store chunks in object store backends
 type Client struct {
 	store      chunk.ObjectClient
-	keyEncoder KeyEncoder
+	keyEncoder chunk.KeyEncoder
 }
 
 // NewClient wraps the provided ObjectClient with a chunk.Client implementation
-func NewClient(store chunk.ObjectClient, encoder KeyEncoder) *Client {
+func NewClient(store chunk.ObjectClient) *Client {
+	var encoder chunk.KeyEncoder
+	// check if store provides a KeyEncoder
+	if encoderClient, ok := store.(chunk.EncoderObjectClient); ok {
+		encoder = encoderClient.KeyEncoder()
+	}
 	return &Client{
 		store:      store,
 		keyEncoder: encoder,
diff --git a/pkg/storage/chunk/storage/factory.go b/pkg/storage/chunk/storage/factory.go
index 7c90a64ca1e25..afc664e47d2f4 100644
--- a/pkg/storage/chunk/storage/factory.go
+++ b/pkg/storage/chunk/storage/factory.go
@@ -298,7 +298,7 @@ func NewChunkClient(name string, cfg Config, schemaCfg chunk.SchemaConfig, regis
 		if err != nil {
 			return nil, err
 		}
-		return objectclient.NewClient(store, objectclient.Base64Encoder), nil
+		return objectclient.NewClient(store), nil
 	case StorageTypeGrpc:
 		return grpc.NewStorageClient(cfg.GrpcConfig, schemaCfg)
 	default:
@@ -310,7 +310,7 @@ func newChunkClientFromStore(store chunk.ObjectClient, err error) (chunk.Client,
 	if err != nil {
 		return nil, err
 	}
-	return objectclient.NewClient(store, nil), nil
+	return objectclient.NewClient(store), nil
 }
 
 // NewTableClient makes a new table client based on the configuration.
diff --git a/pkg/storage/chunk/storage_client.go b/pkg/storage/chunk/storage_client.go
index 7314e5a29aa90..0e8578b1adebb 100644
--- a/pkg/storage/chunk/storage_client.go
+++ b/pkg/storage/chunk/storage_client.go
@@ -79,6 +79,17 @@ type ObjectClient interface {
 	Stop()
 }
 
+// KeyEncoder is used to encode chunk keys before writing/retrieving chunks
+// from the underlying ObjectClient
+type KeyEncoder func(string) string
+
+// EncoderObjectClient is a specialization of the ObjectClient interface that implements encoding schemes for object keys
+type EncoderObjectClient interface {
+	ObjectClient
+	// Returns the KeyEncoder function as defined/required by the ObjectClient
+	KeyEncoder() KeyEncoder
+}
+
 // StorageObject represents an object being stored in an Object Store
 type StorageObject struct {
 	Key        string
diff --git a/pkg/storage/stores/shipper/compactor/compactor.go b/pkg/storage/stores/shipper/compactor/compactor.go
index 801f0b3940431..35abf14355bf9 100644
--- a/pkg/storage/stores/shipper/compactor/compactor.go
+++ b/pkg/storage/stores/shipper/compactor/compactor.go
@@ -16,7 +16,6 @@ import (
 	"github.com/prometheus/common/model"
 
 	loki_storage "github.com/grafana/loki/pkg/storage"
-	"github.com/grafana/loki/pkg/storage/chunk/local"
 	"github.com/grafana/loki/pkg/storage/chunk/objectclient"
 	"github.com/grafana/loki/pkg/storage/chunk/storage"
 	chunk_util "github.com/grafana/loki/pkg/storage/chunk/util"
@@ -109,12 +108,7 @@ func (c *Compactor) init(storageConfig storage.Config, schemaConfig loki_storage
 	c.metrics = newMetrics(r)
 
 	if c.cfg.RetentionEnabled {
-		var encoder objectclient.KeyEncoder
-		if _, ok := objectClient.(*local.FSObjectClient); ok {
-			encoder = objectclient.Base64Encoder
-		}
-
-		chunkClient := objectclient.NewClient(objectClient, encoder)
+		chunkClient := objectclient.NewClient(objectClient)
 
 		retentionWorkDir := filepath.Join(c.cfg.WorkingDirectory, "retention")
 		c.sweeper, err = retention.NewSweeper(retentionWorkDir, chunkClient, c.cfg.RetentionDeleteWorkCount, c.cfg.RetentionDeleteDelay, r)
diff --git a/pkg/storage/stores/shipper/compactor/retention/retention_test.go b/pkg/storage/stores/shipper/compactor/retention/retention_test.go
index a0741ad6a051e..68b175f8a1aca 100644
--- a/pkg/storage/stores/shipper/compactor/retention/retention_test.go
+++ b/pkg/storage/stores/shipper/compactor/retention/retention_test.go
@@ -363,7 +363,7 @@ func TestChunkRewriter(t *testing.T) {
 			require.NoError(t, store.Put(context.TODO(), []chunk.Chunk{tt.chunk}))
 			store.Stop()
 
-			chunkClient := objectclient.NewClient(newTestObjectClient(store.chunkDir), objectclient.Base64Encoder)
+			chunkClient := objectclient.NewClient(newTestObjectClient(store.chunkDir))
 			for _, indexTable := range store.indexTables() {
 				err := indexTable.DB.Update(func(tx *bbolt.Tx) error {
 					bucket := tx.Bucket(bucketName)
@@ -618,7 +618,7 @@ func TestMarkForDelete_SeriesCleanup(t *testing.T) {
 			tables := store.indexTables()
 			require.Len(t, tables, len(tc.expectedDeletedSeries))
 
-			chunkClient := objectclient.NewClient(newTestObjectClient(store.chunkDir), objectclient.Base64Encoder)
+			chunkClient := objectclient.NewClient(newTestObjectClient(store.chunkDir))
 
 			for i, table := range tables {
 				seriesCleanRecorder := newSeriesCleanRecorder()
diff --git a/pkg/storage/stores/shipper/compactor/retention/util_test.go b/pkg/storage/stores/shipper/compactor/retention/util_test.go
index 9ba7d2bfec682..38d971f519db3 100644
--- a/pkg/storage/stores/shipper/compactor/retention/util_test.go
+++ b/pkg/storage/stores/shipper/compactor/retention/util_test.go
@@ -125,6 +125,14 @@ type testObjectClient struct {
 	path string
 }
 
+func (c *testObjectClient) KeyEncoder() chunk.KeyEncoder {
+	var encoder chunk.KeyEncoder
+	if encoderClient, ok := c.ObjectClient.(chunk.EncoderObjectClient); ok {
+		encoder = encoderClient.KeyEncoder()
+	}
+	return encoder
+}
+
 func newTestObjectClient(path string) chunk.ObjectClient {
 	c, err := chunk_storage.NewObjectClient("filesystem", chunk_storage.Config{
 		FSConfig: local.FSConfig{