diff --git a/README.md b/README.md
index 532f0d6d2f..c85695f8ea 100644
--- a/README.md
+++ b/README.md
@@ -157,7 +157,7 @@ resource "aws_iam_service_linked_role" "spot" {
 
 Next create a second terraform workspace and initiate the module, or adapt one of the [examples](./examples).
 
-Note that `github_app.key_base64` needs to be the base64-encoded `.pem` file, i.e., the output of `base64 app.private-key.pem` (not directly the content of `app.private-key.pem`).
+Note that `github_app.key_base64` needs to be a base64-encoded string of the `.pem` file i.e. the output of `base64 app.private-key.pem`. The decoded string can either be a multiline value or a single line value with new lines represented with literal `\n` characters.
 
 ```terraform
 module "github-runner" {
diff --git a/modules/runners/lambdas/runners/src/scale-runners/gh-auth.ts b/modules/runners/lambdas/runners/src/scale-runners/gh-auth.ts
index 297edd0b27..dadb1dcbd4 100644
--- a/modules/runners/lambdas/runners/src/scale-runners/gh-auth.ts
+++ b/modules/runners/lambdas/runners/src/scale-runners/gh-auth.ts
@@ -48,7 +48,12 @@ async function createAuth(installationId: number | undefined, ghesApiUrl: string
     privateKey: Buffer.from(
       await getParameterValue(process.env.PARAMETER_GITHUB_APP_KEY_BASE64_NAME),
       'base64',
-    ).toString(),
+      // replace literal \n characters with new lines to allow the key to be stored as a
+      // single line variable. This logic should match how the GitHub Terraform provider
+      // processes private keys to retain compatibility between the projects
+    )
+      .toString()
+      .replace('/[\\n]/g', String.fromCharCode(10)),
   };
   if (installationId) authOptions = { ...authOptions, installationId };