diff --git a/.changeset/giant-suits-switch.md b/.changeset/giant-suits-switch.md
new file mode 100644
index 0000000000..77d0e62c73
--- /dev/null
+++ b/.changeset/giant-suits-switch.md
@@ -0,0 +1,5 @@
+---
+'@backstage/plugin-azure-devops-backend': patch
+---
+
+Fixed bug with `extractPartsFromAsset` that resulted in a leading `.` being removed from the path in an otherwise valid path (ex. `.assets/image.png`). The leading `.` will now only be moved for paths beginning with `./`.
diff --git a/plugins/azure-devops-backend/src/utils/azure-devops-utils.test.ts b/plugins/azure-devops-backend/src/utils/azure-devops-utils.test.ts
index 86a06b7b0b..c3e2cd1106 100644
--- a/plugins/azure-devops-backend/src/utils/azure-devops-utils.test.ts
+++ b/plugins/azure-devops-backend/src/utils/azure-devops-utils.test.ts
@@ -235,6 +235,15 @@ describe('extractPartsFromAsset', () => {
       ext: '.gif',
     });
   });
+
+  it('should return parts from asset with leading . without /', () => {
+    const result = extractPartsFromAsset('[Image 1](.images/sample-1.PNG)');
+    expect(result).toEqual({
+      label: 'Image 1',
+      path: '.images/sample-1',
+      ext: '.PNG',
+    });
+  });
 });
 
 describe('replaceReadme', () => {
diff --git a/plugins/azure-devops-backend/src/utils/azure-devops-utils.ts b/plugins/azure-devops-backend/src/utils/azure-devops-utils.ts
index 7f5bf39ac4..d24b104bae 100644
--- a/plugins/azure-devops-backend/src/utils/azure-devops-utils.ts
+++ b/plugins/azure-devops-backend/src/utils/azure-devops-utils.ts
@@ -325,7 +325,7 @@ export function extractPartsFromAsset(content: string): {
   return {
     ext,
     label,
-    path: path.startsWith('.') ? path.substring(1, path.length) : path,
+    path: path.startsWith('./') ? path.substring(1, path.length) : path,
   };
 }