diff --git a/Doc/library/tarfile.rst b/Doc/library/tarfile.rst
index 06eba01d21e5261..a28d8b906979661 100644
--- a/Doc/library/tarfile.rst
+++ b/Doc/library/tarfile.rst
@@ -1132,7 +1132,9 @@ reused in custom filters:
     path (after following symlinks) would end up outside the destination.
     This raises :class:`~tarfile.OutsideDestinationError`.
   - :ref:`Refuse <tarfile-extraction-refuse>` to extract links (hard or soft)
-    whose name refers to the destination directory itself.
+    that would be made at the destination directory itself or outside it.
+    Only the directories leading to the link are resolved: a link replaces
+    whatever is at its own path rather than following it.
     This raises :class:`~tarfile.OutsideDestinationError`.
     Note that such files are refused even on platforms that do not support
     symbolic links.
@@ -1152,6 +1154,9 @@ reused in custom filters:
 
      Filenames containing ``..`` components are now normalized.
 
+     Links that would be made at the destination directory itself, or
+     at an existing symbolic link outside it, are now refused.
+
 .. function:: data_filter(member, path)
 
   Implements the ``'data'`` filter.
diff --git a/Lib/tarfile.py b/Lib/tarfile.py
index 57bba1bba54db35..ea205e0c1a56561 100644
--- a/Lib/tarfile.py
+++ b/Lib/tarfile.py
@@ -854,12 +854,19 @@ def _get_filtered_attrs(member, dest_path, for_data=True):
                                    strict=os.path.ALLOW_MISSING)
     if os.path.commonpath([target_path, dest_path]) != dest_path:
         raise OutsideDestinationError(member, target_path)
-    # A link member named after the destination directory itself
-    # would replace it with a (sym)link, redirecting the destination
-    # for all subsequent members.
-    if ((member.islnk() or member.issym())
-            and os.path.normpath(name) == os.curdir):
-        raise OutsideDestinationError(member, target_path)
+    if member.islnk() or member.issym():
+        # A link is made at its own path without following a link already
+        # there (that is unlinked first), so judge it by where it is made:
+        # resolve only the parent directory.  The link must land strictly
+        # inside the destination; one that replaced the destination itself
+        # would redirect all subsequent members.
+        parent, leaf = os.path.split(name.rstrip('/' + os.sep))
+        parent = os.path.realpath(os.path.join(dest_path, parent),
+                                  strict=os.path.ALLOW_MISSING)
+        link_path = os.path.normpath(os.path.join(parent, leaf))
+        if (os.path.commonpath([link_path, dest_path]) != dest_path
+                or os.path.normcase(link_path) == os.path.normcase(dest_path)):
+            raise OutsideDestinationError(member, link_path)
     # Limit permissions (no high bits, and go-w)
     mode = member.mode
     if mode is not None:
diff --git a/Lib/test/test_tarfile.py b/Lib/test/test_tarfile.py
index 639fd0449a989ab..1ca58a95d76ef80 100644
--- a/Lib/test/test_tarfile.py
+++ b/Lib/test/test_tarfile.py
@@ -4676,6 +4676,82 @@ def test_link_at_destination(self):
                     with self.check_context(arc.open(), filter):
                         self.expect_exception(tarfile.OutsideDestinationError)
 
+    @symlink_test
+    @os_helper.skip_unless_symlink
+    def test_link_reaching_destination(self):
+        # gh-160863: link members whose names are not lexically '.' but
+        # that would still be made at the destination directory itself.
+        def via_parent_name(arc):
+            arc.add('../dest', symlink_to='dest')
+
+        def via_symlink_to_dot(arc):
+            arc.add('d/')
+            arc.add('s', symlink_to='.')
+            arc.add('s/.', hardlink_to='d')
+
+        def via_symlink_to_dot_symlink(arc):
+            arc.add('s', symlink_to='.')
+            arc.add('s/.', symlink_to='.')
+
+        for make in (via_parent_name, via_symlink_to_dot,
+                     via_symlink_to_dot_symlink):
+            with ArchiveMaker() as arc:
+                make(arc)
+            for filter in 'tar', 'data':
+                with self.subTest(make.__name__, filter=filter):
+                    with self.check_context(arc.open(), filter):
+                        self.expect_exception(tarfile.OutsideDestinationError)
+
+    @symlink_test
+    @os_helper.skip_unless_symlink
+    def test_link_replacing_outer_symlink(self):
+        # gh-160863: a link member must not replace an existing symlink
+        # outside the destination, even one that points into it.
+        with ArchiveMaker() as arc:
+            arc.add('first.txt', content='1')
+            arc.add('../current', symlink_to='real')
+            arc.add('later.txt', content='2')
+        for filter in 'tar', 'data':
+            with self.subTest(filter=filter), \
+                    os_helper.temp_dir(self.outerdir):
+                real = self.outerdir / 'real'
+                current = self.outerdir / 'current'
+                real.mkdir()
+                current.symlink_to('real')
+                with arc.open() as tar:
+                    with self.assertRaises(tarfile.OutsideDestinationError):
+                        tar.extractall(current, filter=filter)
+                self.assertTrue(current.is_symlink())
+                self.assertEqual(os.listdir(real), ['first.txt'])
+
+        # The link's parent directory may also be reached through a
+        # symlink made earlier in the same archive.
+        with ArchiveMaker() as arc:
+            arc.add('s', symlink_to='..')
+            arc.add('s/outer', symlink_to='dest')
+        with os_helper.temp_dir(self.outerdir):
+            outer = self.outerdir / 'outer'
+            outer.symlink_to('dest')
+            with arc.open() as tar:
+                with self.assertRaises(tarfile.OutsideDestinationError):
+                    tar.extractall(self.destdir, filter='tar')
+            self.assertTrue(outer.is_symlink())
+
+    @symlink_test
+    @os_helper.skip_unless_symlink
+    def test_link_to_dot_reextracted(self):
+        # A symlink to '.' resolves to the destination once it exists;
+        # extracting the same archive again must still replace it.
+        with ArchiveMaker() as arc:
+            arc.add('self', symlink_to='.')
+        for filter in 'tar', 'data':
+            with self.subTest(filter=filter), \
+                    os_helper.temp_dir(self.outerdir):
+                for _ in range(2):
+                    with arc.open() as tar:
+                        tar.extractall(self.destdir, filter=filter)
+                self.assertEqual(os.readlink(self.destdir / 'self'), '.')
+
     @symlink_test
     @os_helper.skip_unless_symlink
     def test_empty_name_symlink_chain(self):
diff --git a/Misc/NEWS.d/next/Security/2026-10-29-12-00-00.gh-issue-160863.zfGUag.rst b/Misc/NEWS.d/next/Security/2026-10-29-12-00-00.gh-issue-160863.zfGUag.rst
new file mode 100644
index 000000000000000..e68de2463eb9f49
--- /dev/null
+++ b/Misc/NEWS.d/next/Security/2026-10-29-12-00-00.gh-issue-160863.zfGUag.rst
@@ -0,0 +1,5 @@
+:func:`tarfile.tar_filter` and :func:`tarfile.data_filter` now judge a link
+member by where the link would be made, resolving only its parent directory.
+This rejects links that reach the destination directory, or an existing
+symbolic link outside it, through ``..`` components or earlier symlink
+members, which :gh:`160097` had allowed past the ``'data'`` filter.