diff --git a/src/utils/normalize-path.ts b/src/utils/normalize-path.ts
index a02b4bdc9f2..1accc62d903 100644
--- a/src/utils/normalize-path.ts
+++ b/src/utils/normalize-path.ts
@@ -5,43 +5,199 @@
  * extended-length paths and don't contain any non-ascii characters.
  * This was created since the path methods in Node.js outputs \\ paths on Windows.
  */
-export const normalizePath = (str: string): string => {
-  // https://github.com/sindresorhus/slash MIT
-  // By Sindre Sorhus
-  if (typeof str !== 'string') {
+export const normalizePath = (path: string) => {
+  if (typeof path !== 'string') {
     throw new Error(`invalid path to normalize`);
   }
-  str = str.trim();
+  path = normalizeSlashes(path);
+  let normalized = getPathFromPathComponents(reducePathComponents(getPathComponents(path)));
+  if (normalized) {
+    normalized = normalized.trim();
 
-  if (EXTENDED_PATH_REGEX.test(str) || NON_ASCII_REGEX.test(str)) {
-    return str;
+    // always remove the trailing /
+    // this makes our file cache look ups consistent
+    if (normalized.charAt(normalized.length - 1) === '/') {
+      const colonIndex = normalized.indexOf(':');
+      if (colonIndex > -1) {
+        if (colonIndex < normalized.length - 2) {
+          normalized = normalized.substring(0, normalized.length - 1);
+        }
+      } else if (normalized.length > 1) {
+        normalized = normalized.substring(0, normalized.length - 1);
+      }
+    }
   }
+  return normalized;
+};
 
-  str = str.replace(SLASH_REGEX, '/');
+const normalizeSlashes = (path: string) => path.replace(backslashRegExp, '/');
 
-  // always remove the trailing /
-  // this makes our file cache look ups consistent
-  if (str.charAt(str.length - 1) === '/') {
-    const colonIndex = str.indexOf(':');
-    if (colonIndex > -1) {
-      if (colonIndex < str.length - 2) {
-        str = str.substring(0, str.length - 1);
+const altDirectorySeparator = "\\";
+const urlSchemeSeparator = "://";
+const backslashRegExp = /\\/g;
+
+const reducePathComponents = (components: readonly string[]) => {
+  if (!Array.isArray(components) || components.length === 0) {
+    return [];
+  }
+  const reduced = [components[0]];
+  for (let i = 1; i < components.length; i++) {
+    const component = components[i];
+    if (!component) continue;
+    if (component === '.') continue;
+    if (component === '..') {
+      if (reduced.length > 1) {
+        if (reduced[reduced.length - 1] !== '..') {
+          reduced.pop();
+          continue;
+        }
       }
+      else if (reduced[0]) continue;
+    }
+    reduced.push(component);
+  }
+  return reduced;
+};
+
+const getPathComponents = (path: string, currentDirectory = '') => {
+  path = combinePaths(currentDirectory, path);
+  return pathComponents(path, getRootLength(path));
+};
+
+const getRootLength = (path: string) => {
+  const rootLength = getEncodedRootLength(path);
+  return rootLength < 0 ? ~rootLength : rootLength;
+};
+
+const getEncodedRootLength = (path: string): number => {
+  if (!path) return 0;
+  const ch0 = path.charCodeAt(0);
+
+  // POSIX or UNC
+  if (ch0 === CharacterCodes.slash || ch0 === CharacterCodes.backslash) {
+    if (path.charCodeAt(1) !== ch0) return 1; // POSIX: "/" (or non-normalized "\")
+
+    const p1 = path.indexOf(ch0 === CharacterCodes.slash ? '/' : altDirectorySeparator, 2);
+    if (p1 < 0) return path.length; // UNC: "//server" or "\\server"
+
+    return p1 + 1; // UNC: "//server/" or "\\server\"
+  }
+
+  // DOS
+  if (isVolumeCharacter(ch0) && path.charCodeAt(1) === CharacterCodes.colon) {
+    const ch2 = path.charCodeAt(2);
+    if (ch2 === CharacterCodes.slash || ch2 === CharacterCodes.backslash) return 3; // DOS: "c:/" or "c:\"
+    if (path.length === 2) return 2; // DOS: "c:" (but not "c:d")
+  }
 
-    } else if (str.length > 1) {
-      str = str.substring(0, str.length - 1);
+  // URL
+  const schemeEnd = path.indexOf(urlSchemeSeparator);
+  if (schemeEnd !== -1) {
+    const authorityStart = schemeEnd + urlSchemeSeparator.length;
+    const authorityEnd = path.indexOf('/', authorityStart);
+    if (authorityEnd !== -1) { // URL: "file:///", "file://server/", "file://server/path"
+      // For local "file" URLs, include the leading DOS volume (if present).
+      // Per https://www.ietf.org/rfc/rfc1738.txt, a host of "" or "localhost" is a
+      // special case interpreted as "the machine from which the URL is being interpreted".
+      const scheme = path.slice(0, schemeEnd);
+      const authority = path.slice(authorityStart, authorityEnd);
+      if (scheme === "file" && (authority === "" || authority === "localhost") &&
+        isVolumeCharacter(path.charCodeAt(authorityEnd + 1))) {
+        const volumeSeparatorEnd = getFileUrlVolumeSeparatorEnd(path, authorityEnd + 2);
+        if (volumeSeparatorEnd !== -1) {
+          if (path.charCodeAt(volumeSeparatorEnd) === CharacterCodes.slash) {
+            // URL: "file:///c:/", "file://localhost/c:/", "file:///c%3a/", "file://localhost/c%3a/"
+            return ~(volumeSeparatorEnd + 1);
+          }
+          if (volumeSeparatorEnd === path.length) {
+            // URL: "file:///c:", "file://localhost/c:", "file:///c$3a", "file://localhost/c%3a"
+            // but not "file:///c:d" or "file:///c%3ad"
+            return ~volumeSeparatorEnd;
+          }
+        }
+      }
+      return ~(authorityEnd + 1); // URL: "file://server/", "http://server/"
+    }
+    return ~path.length; // URL: "file://server", "http://server"
+  }
+
+  // relative
+  return 0;
+}
+
+const isVolumeCharacter = (charCode: number) =>
+  (charCode >= CharacterCodes.a && charCode <= CharacterCodes.z) ||
+  (charCode >= CharacterCodes.A && charCode <= CharacterCodes.Z);
+
+  const getFileUrlVolumeSeparatorEnd = (url: string, start: number) => {
+  const ch0 = url.charCodeAt(start);
+  if (ch0 === CharacterCodes.colon) return start + 1;
+  if (ch0 === CharacterCodes.percent && url.charCodeAt(start + 1) === CharacterCodes._3) {
+    const ch2 = url.charCodeAt(start + 2);
+    if (ch2 === CharacterCodes.a || ch2 === CharacterCodes.A) return start + 3;
+  }
+  return -1;
+};
+
+const pathComponents = (path: string, rootLength: number) => {
+  const root = path.substring(0, rootLength);
+  const rest = path.substring(rootLength).split('/');
+  if (rest.length && !lastOrUndefined(rest)) rest.pop();
+  return [root, ...rest];
+};
+
+const lastOrUndefined = <T>(array: readonly T[]): T | undefined =>
+  array.length === 0 ? undefined : array[array.length - 1];
+
+const combinePaths = (path: string, ...paths: (string | undefined)[]) => {
+  if (path) path = normalizeSlashes(path);
+  for (let relativePath of paths) {
+    if (!relativePath) continue;
+    relativePath = normalizeSlashes(relativePath);
+    if (!path || getRootLength(relativePath) !== 0) {
+      path = relativePath;
+    } else {
+      path = ensureTrailingDirectorySeparator(path) + relativePath;
     }
   }
+  return path;
+}
 
-  return str;
+const getPathFromPathComponents = (pathComponents: readonly string[]) => {
+  if (pathComponents.length === 0) return '';
+  const root = pathComponents[0] && ensureTrailingDirectorySeparator(pathComponents[0]);
+  return root + pathComponents.slice(1).join('/');
 };
 
+const ensureTrailingDirectorySeparator = (path: string) => {
+  if (!hasTrailingDirectorySeparator(path)) {
+    return path + '/';
+  }
+  return path;
+};
+
+const hasTrailingDirectorySeparator = (path: string) =>
+  path.length > 0 && isAnyDirectorySeparator(path.charCodeAt(path.length - 1));
+
+const isAnyDirectorySeparator = (charCode: number) =>
+  charCode === CharacterCodes.slash || charCode === CharacterCodes.backslash;
+
 /**
  * Same as normalizePath(), expect it'll also strip any querystrings
  * from the path name. So /dir/file.css?tag=cmp-a becomes /dir/file.css
  */
 export const normalizeFsPath = (p: string) => normalizePath(p.split('?')[0]);
 
-const EXTENDED_PATH_REGEX = /^\\\\\?\\/;
-const NON_ASCII_REGEX = /[^\x00-\x80]+/;
-const SLASH_REGEX = /\\/g;
+const enum CharacterCodes {
+  a = 0x61,
+  A = 0x41,
+  z = 0x7A,
+  Z = 0x5a,
+  _3 = 0x33,
+
+  backslash = 0x5C,             // \
+  colon = 0x3A,                 // :
+  dot = 0x2E,                   // .
+  percent = 0x25,               // %
+  slash = 0x2F,                 // /
+}
diff --git a/src/utils/test/normalize-path.spec.ts b/src/utils/test/normalize-path.spec.ts
new file mode 100644
index 00000000000..936c27c57ab
--- /dev/null
+++ b/src/utils/test/normalize-path.spec.ts
@@ -0,0 +1,63 @@
+import { normalizePath } from '../normalize-path';
+
+
+describe('normalizePath', () => {
+
+  it('normalize posix', () => {
+    expect(normalizePath('/dir/basename.ext')).toBe('/dir/basename.ext');
+    expect(normalizePath('/dir')).toBe('/dir');
+  });
+
+  it('normalize win32', () => {
+    expect(normalizePath('C:\\dir\\basename.ext')).toBe('C:/dir/basename.ext');
+    expect(normalizePath('C:\\dir')).toBe('C:/dir');
+  });
+
+  it('non-ascii', () => {
+    expect(normalizePath('/中文/basename.ext')).toBe('/中文/basename.ext');
+    expect(normalizePath('C:\\中文\\basename.ext')).toBe('C:/中文/basename.ext');
+  });
+
+  it('remove trailing slash, windows', () => {
+    const path = normalizePath(`C:\\Johnny\\B\\Goode\\`);
+    expect(path).toBe(`C:/Johnny/B/Goode`);
+  });
+
+  it('normalize file, windows', () => {
+    const path = normalizePath(`C:\\Johnny\\B\\Goode.js`);
+    expect(path).toBe(`C:/Johnny/B/Goode.js`);
+  });
+
+  it('not remove trailing slash for root dir, windows', () => {
+    const path = normalizePath(`C:\\`);
+    expect(path).toBe(`C:/`);
+  });
+
+  it('not remove trailing slash for root dir, unix', () => {
+    const path = normalizePath(`/`);
+    expect(path).toBe(`/`);
+  });
+
+  it('remove trailing slash, unix', () => {
+    const path = normalizePath(`/Johnny/B/Goode/`);
+    expect(path).toBe(`/Johnny/B/Goode`);
+  });
+
+  it('normalize file, unix', () => {
+    const path = normalizePath(`/Johnny/B/Goode.js`);
+    expect(path).toBe(`/Johnny/B/Goode.js`);
+  });
+
+  it('normalize file with spaces to trim', () => {
+    const path = normalizePath(`    /Johnny/B/Goode.js    `);
+    expect(path).toBe(`/Johnny/B/Goode.js`);
+  });
+
+  it('throw error when invalid string', () => {
+    expect(() => {
+      const path = normalizePath(null);
+      expect(path).toBe(`/Johnny/B/Goode.js`);
+    }).toThrow();
+  });
+
+});
diff --git a/src/utils/test/util.spec.ts b/src/utils/test/util.spec.ts
index 7223da31dc8..937e6ac1408 100644
--- a/src/utils/test/util.spec.ts
+++ b/src/utils/test/util.spec.ts
@@ -1,55 +1,8 @@
 import * as util from '../util';
-import { normalizePath } from '../normalize-path';
 
 
 describe('util', () => {
 
-  describe('normalizePath', () => {
-
-    it('remove trailing slash, windows', () => {
-      const path = normalizePath(`C:\\Johnny\\B\\Goode\\`);
-      expect(path).toBe(`C:/Johnny/B/Goode`);
-    });
-
-    it('normalize file, windows', () => {
-      const path = normalizePath(`C:\\Johnny\\B\\Goode.js`);
-      expect(path).toBe(`C:/Johnny/B/Goode.js`);
-    });
-
-    it('not remove trailing slash for root dir, windows', () => {
-      const path = normalizePath(`C:\\`);
-      expect(path).toBe(`C:/`);
-    });
-
-    it('not remove trailing slash for root dir, unix', () => {
-      const path = normalizePath(`/`);
-      expect(path).toBe(`/`);
-    });
-
-    it('remove trailing slash, unix', () => {
-      const path = normalizePath(`/Johnny/B/Goode/`);
-      expect(path).toBe(`/Johnny/B/Goode`);
-    });
-
-    it('normalize file, unix', () => {
-      const path = normalizePath(`/Johnny/B/Goode.js`);
-      expect(path).toBe(`/Johnny/B/Goode.js`);
-    });
-
-    it('normalize file with spaces to trim', () => {
-      const path = normalizePath(`    /Johnny/B/Goode.js    `);
-      expect(path).toBe(`/Johnny/B/Goode.js`);
-    });
-
-    it('throw error when invalid string', () => {
-      expect(() => {
-        const path = normalizePath(null);
-        expect(path).toBe(`/Johnny/B/Goode.js`);
-      }).toThrow();
-    });
-
-  });
-
   describe('isTsFile', () => {
     it('should return true for regular .ts and .tsx files', () => {
       expect(util.isTsFile('.ts')).toEqual(true);