diff --git a/modules/angular2/src/router/rules/route_paths/param_route_path.ts b/modules/angular2/src/router/rules/route_paths/param_route_path.ts
index e854874965..fc7daf3171 100644
--- a/modules/angular2/src/router/rules/route_paths/param_route_path.ts
+++ b/modules/angular2/src/router/rules/route_paths/param_route_path.ts
@@ -62,7 +62,7 @@ class DynamicPathSegment implements PathSegment {
       throw new BaseException(
           `Route generator for '${this.name}' was not included in parameters passed.`);
     }
-    return normalizeString(params.get(this.name));
+    return encodeDynamicSegment(normalizeString(params.get(this.name)));
   }
 }
 
@@ -130,7 +130,7 @@ export class ParamRoutePath implements RoutePath {
         captured.push(currentUrlSegment.path);
 
         if (pathSegment instanceof DynamicPathSegment) {
-          positionalParams[pathSegment.name] = currentUrlSegment.path;
+          positionalParams[pathSegment.name] = decodeDynamicSegment(currentUrlSegment.path);
         } else if (!pathSegment.match(currentUrlSegment.path)) {
           return null;
         }
@@ -269,3 +269,43 @@ export class ParamRoutePath implements RoutePath {
   }
   static RESERVED_CHARS = RegExpWrapper.create('//|\\(|\\)|;|\\?|=');
 }
+
+let REGEXP_PERCENT = /%/g;
+let REGEXP_SLASH = /\//g;
+let REGEXP_OPEN_PARENT = /\(/g;
+let REGEXP_CLOSE_PARENT = /\)/g;
+let REGEXP_SEMICOLON = /;/g;
+
+function encodeDynamicSegment(value: string): string {
+  if (isBlank(value)) {
+    return null;
+  }
+
+  value = StringWrapper.replaceAll(value, REGEXP_PERCENT, '%25');
+  value = StringWrapper.replaceAll(value, REGEXP_SLASH, '%2F');
+  value = StringWrapper.replaceAll(value, REGEXP_OPEN_PARENT, '%28');
+  value = StringWrapper.replaceAll(value, REGEXP_CLOSE_PARENT, '%29');
+  value = StringWrapper.replaceAll(value, REGEXP_SEMICOLON, '%3B');
+
+  return value;
+}
+
+let REGEXP_ENC_SEMICOLON = /%3B/ig;
+let REGEXP_ENC_CLOSE_PARENT = /%29/ig;
+let REGEXP_ENC_OPEN_PARENT = /%28/ig;
+let REGEXP_ENC_SLASH = /%2F/ig;
+let REGEXP_ENC_PERCENT = /%25/ig;
+
+function decodeDynamicSegment(value: string): string {
+  if (isBlank(value)) {
+    return null;
+  }
+
+  value = StringWrapper.replaceAll(value, REGEXP_ENC_SEMICOLON, ';');
+  value = StringWrapper.replaceAll(value, REGEXP_ENC_CLOSE_PARENT, ')');
+  value = StringWrapper.replaceAll(value, REGEXP_ENC_OPEN_PARENT, '(');
+  value = StringWrapper.replaceAll(value, REGEXP_ENC_SLASH, '/');
+  value = StringWrapper.replaceAll(value, REGEXP_ENC_PERCENT, '%');
+
+  return value;
+}
diff --git a/modules/angular2/test/router/rules/route_paths/param_route_path_spec.ts b/modules/angular2/test/router/rules/route_paths/param_route_path_spec.ts
index 94eaaf888d..adb81c879e 100644
--- a/modules/angular2/test/router/rules/route_paths/param_route_path_spec.ts
+++ b/modules/angular2/test/router/rules/route_paths/param_route_path_spec.ts
@@ -50,6 +50,33 @@ export function main() {
          });
     });
 
+    describe('dynamic segments', () => {
+      it('should parse parameters', () => {
+        var rec = new ParamRoutePath('/test/:id');
+        var url = new Url('test', new Url('abc'));
+        var match = rec.matchUrl(url);
+        expect(match.allParams).toEqual({'id': 'abc'});
+      });
+
+      it('should decode special characters when parsing', () => {
+        var rec = new ParamRoutePath('/test/:id');
+        var url = new Url('test', new Url('abc%25%2F%2f%28%29%3B'));
+        var match = rec.matchUrl(url);
+        expect(match.allParams).toEqual({'id': 'abc%//();'});
+      });
+
+      it('should generate url', () => {
+        var rec = new ParamRoutePath('/test/:id');
+        expect(rec.generateUrl({'id': 'abc'}).urlPath).toEqual('test/abc');
+      });
+
+      it('should encode special characters when generating', () => {
+        var rec = new ParamRoutePath('/test/:id');
+        expect(rec.generateUrl({'id': 'abc/def/%();'}).urlPath)
+            .toEqual('test/abc%2Fdef%2F%25%28%29%3B');
+      });
+    });
+
     describe('matrix params', () => {
       it('should be parsed along with dynamic paths', () => {
         var rec = new ParamRoutePath('/hello/:id');