diff -r 4d56006133f1 Lib/tarfile.py
--- a/Lib/tarfile.py	Sat Jan 18 22:57:05 2014 -0500
+++ b/Lib/tarfile.py	Sun Jan 19 22:29:25 2014 +0800
@@ -2079,6 +2079,11 @@
         else:
             self._dbg(1, tarinfo.name)
 
+        if os.path.exists(targetpath):
+            if os.path.isdir(targetpath) and not os.path.islink(targetpath):
+                os.rmdir(targetpath)
+            else:
+                os.remove(targetpath)
         if tarinfo.isreg():
             self.makefile(tarinfo, targetpath)
         elif tarinfo.isdir():
@@ -2169,7 +2174,10 @@
         try:
             # For systems that support symbolic and hard links.
             if tarinfo.issym():
-                os.symlink(tarinfo.linkname, targetpath)
+                if os.name == 'nt' and os.path.isdir(tarinfo.linkname):
+                    os.symlink(tarinfo.linkname, targetpath, target_is_directory=True)
+                else:
+                    os.symlink(tarinfo.linkname, targetpath)
             else:
                 # See extract().
                 if os.path.exists(tarinfo._link_target):
diff -r 4d56006133f1 Lib/test/test_tarfile.py
--- a/Lib/test/test_tarfile.py	Sat Jan 18 22:57:05 2014 -0500
+++ b/Lib/test/test_tarfile.py	Sun Jan 19 22:29:25 2014 +0800
@@ -1090,20 +1090,52 @@
         temparchive = os.path.join(TEMPDIR, "testsymlinks.tar")
         os.mkdir(tempdir)
         try:
-            source_file = os.path.join(tempdir,'source')
-            target_file = os.path.join(tempdir,'symlink')
+            # File symlink
+            source_file = os.path.join(tempdir, 'source')
+            other_source_file = os.path.join(tempdir, 'other_source')
+            target_file = os.path.join(tempdir, 'symlink')
             with open(source_file,'w') as f:
-                f.write('something\n')
+                f.write('source file content\n')
+            with open(other_source_file,'w') as f:
+                f.write('other source file content\n')
             os.symlink(source_file, target_file)
+            # Directory symlink
+            source_dir = os.path.join(tempdir, 'source_dir')
+            other_source_dir = os.path.join(tempdir, 'other_source_dir')
+            target_dir = os.path.join(tempdir, 'symlink_dir')
+            os.mkdir(source_dir)
+            os.mkdir(other_source_dir)
+            os.symlink(source_dir, target_dir)
             tar = tarfile.open(temparchive,'w')
-            tar.add(source_file)
-            tar.add(target_file)
+            # We don't want to add absolute path to tar file because
+            # we don't want nested directory after extracting the file:
+            # /home/user/python/symlink/home/user/python/symlink/file
+            with support.change_cwd(tempdir):
+                tar.add('source')
+                tar.add('symlink')
+                tar.add('source_dir')
+                tar.add('symlink_dir')
             tar.close()
-            # Let's extract it to the location which contains the symlink
+            # Point target_file to other_source_file and target_dir to
+            # other_source_dir to exercise overwriting behavior.
+            os.unlink(target_file)
+            os.symlink(other_source_file, target_file)
+            os.unlink(target_dir)
+            os.symlink(other_source_dir, target_dir)
             tar = tarfile.open(temparchive,'r')
-            # this should not raise OSError: [Errno 17] File exists
             try:
+                with open(target_file) as f:
+                    self.assertEqual(f.read(), 'other source file content\n')
+                self.assertEqual(os.readlink(target_dir), other_source_dir)
+                # Let's extract it to the location which contains the symlink
                 tar.extractall(path=tempdir)
+                # target_file that symlinked to other_source_file now symlinks
+                # back to source_file, and target_dir that symlinked to
+                # other_source_dir now symlinks back to source_dir.
+                with open(target_file) as f:
+                    self.assertEqual(f.read(), 'source file content\n')
+                self.assertEqual(os.readlink(target_dir), source_dir)
+            # This should not raise OSError: [Errno 17] File exists
             except OSError:
                 self.fail("extractall failed with symlinked files")
             finally: