diff --git a/src/spec-node/devContainersSpecCLI.ts b/src/spec-node/devContainersSpecCLI.ts
index 2c3902241..b108b2574 100644
--- a/src/spec-node/devContainersSpecCLI.ts
+++ b/src/spec-node/devContainersSpecCLI.ts
@@ -16,7 +16,7 @@ import { probeRemoteEnv, runPostCreateCommands, runRemoteCommand, UserEnvProbe }
 import { bailOut, buildNamedImageAndExtend, findDevContainer, hostFolderLabel } from './singleContainer';
 import { extendImage } from './containerFeatures';
 import { DockerCLIParameters, dockerPtyCLI, inspectContainer } from '../spec-shutdown/dockerUtils';
-import { buildAndExtendDockerCompose, getProjectName, readDockerComposeConfig } from './dockerCompose';
+import { buildAndExtendDockerCompose, getDefaultImageName, getProjectName, readDockerComposeConfig } from './dockerCompose';
 import { getDockerComposeFilePaths } from '../spec-configuration/configuration';
 import { workspaceFromPath } from '../spec-utils/workspaces';
 import { readDevContainerConfigFile } from './configContainer';
@@ -384,7 +384,7 @@ async function doBuild({
 			await buildAndExtendDockerCompose(config, projectName, infoParams, composeFiles, envFile, composeGlobalArgs, [config.service], params.buildNoCache || false, params.common.persistedFolder, 'docker-compose.devcontainer.build', addCacheFroms);
 
 			const service = composeConfig.services[config.service];
-			const originalImageName = service.image || `${projectName}_${config.service}`;
+			const originalImageName = service.image || getDefaultImageName(await buildParams.dockerComposeCLI(), projectName, config.service);
 
 			if (imageNames) {
 				await Promise.all(imageNames.map(imageName => dockerPtyCLI(params, 'tag', originalImageName, imageName)));
diff --git a/src/spec-node/dockerCompose.ts b/src/spec-node/dockerCompose.ts
index 3dbead455..c4e68e8f1 100644
--- a/src/spec-node/dockerCompose.ts
+++ b/src/spec-node/dockerCompose.ts
@@ -319,7 +319,7 @@ async function startContainer(params: DockerResolverParameters, buildParams: Doc
 	const { started } = await startEventSeen(params, { [projectLabel]: projectName, [serviceLabel]: config.service }, canceled, common.output, common.getLogLevel() === LogLevel.Trace); // await getEvents, but only assign started.
 
 	const service = composeConfig.services[config.service];
-	const originalImageName = service.image || `${projectName}_${config.service}`;
+	const originalImageName = service.image || getDefaultImageName(await buildParams.dockerComposeCLI(), projectName, config.service);
 
 	// Try to restore the 'third' docker-compose file and featuresConfig from persisted storage.
 	// This file may have been generated upon a Codespace creation.
@@ -400,6 +400,12 @@ async function startContainer(params: DockerResolverParameters, buildParams: Doc
 	};
 }
 
+export function getDefaultImageName(dockerComposeCLI: DockerComposeCLI, projectName: string, serviceName: string) {
+	const version = parseVersion(dockerComposeCLI.version);
+	const separator = version && isEarlierVersion(version, [2, 8, 0]) ? '_' : '-';
+	return `${projectName}${separator}${serviceName}`;
+}
+
 async function writeFeaturesComposeOverrideFile(
 	updatedImageName: string,
 	originalImageName: string,