diff --git a/_packages/api/test/api.test.ts b/_packages/api/test/api.test.ts
index a01b029fac..1a097cf1b3 100644
--- a/_packages/api/test/api.test.ts
+++ b/_packages/api/test/api.test.ts
@@ -8,6 +8,7 @@ import {
     cast,
     isImportDeclaration,
     isNamedImports,
+    isStringLiteral,
     isTemplateHead,
     isTemplateMiddle,
     isTemplateTail,
@@ -113,6 +114,31 @@ describe("SourceFile", () => {
     });
 });
 
+test("unicode escapes", () => {
+    const srcFiles = {
+        "/src/1.ts": `"😃"`,
+        "/src/2.ts": `"\\ud83d\\ude03"`, // this is "😃"
+    };
+
+    const api = spawnAPI({
+        "/tsconfig.json": "{}",
+        ...srcFiles,
+    });
+    const project = api.loadProject("/tsconfig.json");
+
+    Object.keys(srcFiles).forEach(file => {
+        const sourceFile = project.getSourceFile(file);
+        assert.ok(sourceFile);
+
+        sourceFile.forEachChild(function visit(node) {
+            if (isStringLiteral(node)) {
+                assert.equal(node.text, "😃");
+            }
+            node.forEachChild(visit);
+        });
+    });
+});
+
 test("Object equality", () => {
     const api = spawnAPI();
     const project = api.loadProject("/tsconfig.json");
diff --git a/internal/api/encoder/encoder_test.go b/internal/api/encoder/encoder_test.go
index 4d1be79d36..232c0fec37 100644
--- a/internal/api/encoder/encoder_test.go
+++ b/internal/api/encoder/encoder_test.go
@@ -35,6 +35,24 @@ func TestEncodeSourceFile(t *testing.T) {
 	})
 }
 
+func TestEncodeSourceFileWithUnicodeEscapes(t *testing.T) {
+	t.Parallel()
+	sourceFile := parser.ParseSourceFile(ast.SourceFileParseOptions{
+		FileName: "/test.ts",
+		Path:     "/test.ts",
+	}, `let a = "😃"; let b = "\ud83d\ude03"; let c = "\udc00\ud83d\ude03"; let d = "\ud83d\ud83d\ude03"`, core.ScriptKindTS)
+	t.Run("baseline", func(t *testing.T) {
+		t.Parallel()
+		buf, err := encoder.EncodeSourceFile(sourceFile, "")
+		assert.NilError(t, err)
+
+		str := formatEncodedSourceFile(buf)
+		baseline.Run(t, "encodeSourceFileWithUnicodeEscapes.txt", str, baseline.Options{
+			Subfolder: "api",
+		})
+	})
+}
+
 func BenchmarkEncodeSourceFile(b *testing.B) {
 	repo.SkipIfNoTypeScriptSubmodule(b)
 	filePath := filepath.Join(repo.TypeScriptSubmodulePath, "src/compiler/checker.ts")
diff --git a/internal/scanner/scanner.go b/internal/scanner/scanner.go
index 1ee64b62f1..72ae4f7ca6 100644
--- a/internal/scanner/scanner.go
+++ b/internal/scanner/scanner.go
@@ -1629,6 +1629,13 @@ func (s *Scanner) scanEscapeSequence(flags EscapeSequenceScanningFlags) string {
 		codePoint := s.scanUnicodeEscape(flags&EscapeSequenceScanningFlagsReportInvalidEscapeErrors != 0)
 		if codePoint < 0 {
 			return s.text[start:s.pos]
+		} else if codePointIsHighSurrogate(codePoint) && s.char() == '\\' && s.charAt(1) == 'u' {
+			savedPos := s.pos
+			nextCodePoint := s.scanUnicodeEscape(flags&EscapeSequenceScanningFlagsReportInvalidEscapeErrors != 0)
+			if codePointIsLowSurrogate(nextCodePoint) {
+				return string(surrogatePairToCodepoint(codePoint, nextCodePoint))
+			}
+			s.pos = savedPos // restore position because we do not consume nextCodePoint
 		}
 		return string(codePoint)
 	case 'x':
diff --git a/internal/scanner/utilities.go b/internal/scanner/utilities.go
index 06ba7cf666..06b29a1e2a 100644
--- a/internal/scanner/utilities.go
+++ b/internal/scanner/utilities.go
@@ -8,6 +8,25 @@ import (
 	"github.com/microsoft/typescript-go/internal/core"
 )
 
+const (
+	surr1    = 0xd800
+	surr2    = 0xdc00
+	surr3    = 0xe000
+	surrSelf = 0x10000
+)
+
+func codePointIsHighSurrogate(r rune) bool {
+	return surr1 <= r && r < surr2
+}
+
+func codePointIsLowSurrogate(r rune) bool {
+	return surr2 <= r && r < surr3
+}
+
+func surrogatePairToCodepoint(r1, r2 rune) rune {
+	return (r1-surr1)<<10 | (r2 - surr2) + surrSelf
+}
+
 func tokenIsIdentifierOrKeyword(token ast.Kind) bool {
 	return token >= ast.KindIdentifier
 }
diff --git a/testdata/baselines/reference/api/encodeSourceFileWithUnicodeEscapes.txt b/testdata/baselines/reference/api/encodeSourceFileWithUnicodeEscapes.txt
new file mode 100644
index 0000000000..93102c786a
--- /dev/null
+++ b/testdata/baselines/reference/api/encodeSourceFileWithUnicodeEscapes.txt
@@ -0,0 +1,27 @@
+KindSourceFile [0, 98), i=1, next=0
+  NodeList [0, 98), i=2, next=27
+    KindVariableStatement [0, 15), i=3, next=9
+      KindVariableDeclarationList [0, 14), i=4, next=0
+        NodeList [3, 14), i=5, next=0
+          KindVariableDeclaration [3, 14), i=6, next=0
+            KindIdentifier "a" [3, 5), i=7, next=8
+            KindStringLiteral "😃" [7, 14), i=8, next=0
+    KindVariableStatement [15, 39), i=9, next=15
+      KindVariableDeclarationList [15, 38), i=10, next=0
+        NodeList [19, 38), i=11, next=0
+          KindVariableDeclaration [19, 38), i=12, next=0
+            KindIdentifier "b" [19, 21), i=13, next=14
+            KindStringLiteral "😃" [23, 38), i=14, next=0
+    KindVariableStatement [39, 69), i=15, next=21
+      KindVariableDeclarationList [39, 68), i=16, next=0
+        NodeList [43, 68), i=17, next=0
+          KindVariableDeclaration [43, 68), i=18, next=0
+            KindIdentifier "c" [43, 45), i=19, next=20
+            KindStringLiteral "�😃" [47, 68), i=20, next=0
+    KindVariableStatement [69, 98), i=21, next=0
+      KindVariableDeclarationList [69, 98), i=22, next=0
+        NodeList [73, 98), i=23, next=0
+          KindVariableDeclaration [73, 98), i=24, next=0
+            KindIdentifier "d" [73, 75), i=25, next=26
+            KindStringLiteral "�😃" [77, 98), i=26, next=0
+  KindEndOfFile [98, 98), i=27, next=0