diff --git a/.vscode/launch.json b/.vscode/launch.json
new file mode 100644
index 0000000000..94965ca7b2
--- /dev/null
+++ b/.vscode/launch.json
@@ -0,0 +1,36 @@
+{
+    "version": "0.2.0",
+    "configurations": [
+      {
+        "type": "node",
+        "request": "launch",
+        "name": "Debug Jest Tests",
+        "program": "${workspaceFolder}/node_modules/jest/bin/jest.js",
+        "args": [
+          "--runInBand",
+          "--testTimeout",
+          "10000"
+        ],
+        "cwd": "${workspaceFolder}",
+        "console": "integratedTerminal",
+        "internalConsoleOptions": "neverOpen",
+        "disableOptimisticBPs": true
+      },
+      {
+        "type": "node",
+        "request": "launch",
+        "name": "Debug Current Test File",
+        "program": "${workspaceFolder}/node_modules/jest/bin/jest.js",
+        "args": [
+          "--runInBand",
+          "--testTimeout",
+          "10000",
+          "${relativeFile}"
+        ],
+        "cwd": "${workspaceFolder}",
+        "console": "integratedTerminal",
+        "internalConsoleOptions": "neverOpen",
+        "disableOptimisticBPs": true
+      }
+    ]
+}
\ No newline at end of file
diff --git a/packages/artifact/__tests__/download-artifact.test.ts b/packages/artifact/__tests__/download-artifact.test.ts
index ec9302721a..602c1d82c0 100644
--- a/packages/artifact/__tests__/download-artifact.test.ts
+++ b/packages/artifact/__tests__/download-artifact.test.ts
@@ -104,6 +104,7 @@ const cleanup = async (): Promise<void> => {
 const mockGetArtifactSuccess = jest.fn(() => {
   const message = new http.IncomingMessage(new net.Socket())
   message.statusCode = 200
+  message.headers['content-type'] = 'application/zip'
   message.push(fs.readFileSync(fixtures.exampleArtifact.path))
   message.push(null)
   return {
@@ -114,6 +115,7 @@ const mockGetArtifactSuccess = jest.fn(() => {
 const mockGetArtifactHung = jest.fn(() => {
   const message = new http.IncomingMessage(new net.Socket())
   message.statusCode = 200
+  message.headers['content-type'] = 'application/zip'
   // Don't push any data or call push(null) to end the stream
   // This creates a stream that hangs and never completes
   return {
@@ -134,6 +136,7 @@ const mockGetArtifactFailure = jest.fn(() => {
 const mockGetArtifactMalicious = jest.fn(() => {
   const message = new http.IncomingMessage(new net.Socket())
   message.statusCode = 200
+  message.headers['content-type'] = 'application/zip'
   message.push(fs.readFileSync(path.join(__dirname, 'fixtures', 'evil.zip'))) // evil.zip contains files that are formatted x/../../etc/hosts
   message.push(null)
   return {
@@ -623,6 +626,13 @@ describe('download-artifact', () => {
   })
 
   describe('streamExtractExternal', () => {
+    beforeEach(async () => {
+      await setup()
+      // Create workspace directory for streamExtractExternal tests
+      await fs.promises.mkdir(fixtures.workspaceDir, {recursive: true})
+    })
+    afterEach(cleanup)
+
     it('should fail if the timeout is exceeded', async () => {
       const mockSlowGetArtifact = jest.fn(mockGetArtifactHung)
 
@@ -641,12 +651,297 @@ describe('download-artifact', () => {
           {timeout: 2}
         )
         expect(true).toBe(false) // should not be called
-      } catch (e) {
+      } catch (error: unknown) {
+        const e = error as Error
         expect(e).toBeInstanceOf(Error)
         expect(e.message).toContain('did not respond in 2ms')
         expect(mockHttpClient).toHaveBeenCalledWith(getUserAgentString())
         expect(mockSlowGetArtifact).toHaveBeenCalledTimes(1)
       }
     })
+
+    it('should extract zip file when content-type is application/zip', async () => {
+      const mockHttpClient = (HttpClient as jest.Mock).mockImplementation(
+        () => {
+          return {
+            get: mockGetArtifactSuccess
+          }
+        }
+      )
+
+      await streamExtractExternal(
+        fixtures.blobStorageUrl,
+        fixtures.workspaceDir
+      )
+
+      expect(mockHttpClient).toHaveBeenCalledWith(getUserAgentString())
+      // Verify files were extracted (not saved as a single file)
+      await expectExtractedArchive(fixtures.workspaceDir)
+    })
+
+    it('should save raw file without extracting when content-type is not a zip', async () => {
+      const rawFileContent = 'This is a raw text file, not a zip'
+      const rawFileName = 'my-artifact.txt'
+
+      const mockGetRawFile = jest.fn(() => {
+        const message = new http.IncomingMessage(new net.Socket())
+        message.statusCode = 200
+        message.headers['content-type'] = 'text/plain'
+        message.headers['content-disposition'] =
+          `attachment; filename="${rawFileName}"`
+        message.push(Buffer.from(rawFileContent))
+        message.push(null)
+        return {
+          message
+        }
+      })
+
+      const mockHttpClient = (HttpClient as jest.Mock).mockImplementation(
+        () => {
+          return {
+            get: mockGetRawFile
+          }
+        }
+      )
+
+      await streamExtractExternal(
+        fixtures.blobStorageUrl,
+        fixtures.workspaceDir
+      )
+
+      expect(mockHttpClient).toHaveBeenCalledWith(getUserAgentString())
+      // Verify file was saved as-is, not extracted
+      const savedFilePath = path.join(fixtures.workspaceDir, rawFileName)
+      expect(fs.existsSync(savedFilePath)).toBe(true)
+      expect(fs.readFileSync(savedFilePath, 'utf8')).toBe(rawFileContent)
+    })
+
+    it('should save raw file with default name when content-disposition is missing', async () => {
+      const rawFileContent = 'Binary content here'
+
+      const mockGetRawFileNoDisposition = jest.fn(() => {
+        const message = new http.IncomingMessage(new net.Socket())
+        message.statusCode = 200
+        message.headers['content-type'] = 'application/octet-stream'
+        // No content-disposition header
+        message.push(Buffer.from(rawFileContent))
+        message.push(null)
+        return {
+          message
+        }
+      })
+
+      const mockHttpClient = (HttpClient as jest.Mock).mockImplementation(
+        () => {
+          return {
+            get: mockGetRawFileNoDisposition
+          }
+        }
+      )
+
+      await streamExtractExternal(
+        fixtures.blobStorageUrl,
+        fixtures.workspaceDir
+      )
+
+      expect(mockHttpClient).toHaveBeenCalledWith(getUserAgentString())
+      // Verify file was saved with default name 'artifact'
+      const savedFilePath = path.join(fixtures.workspaceDir, 'artifact')
+      expect(fs.existsSync(savedFilePath)).toBe(true)
+      expect(fs.readFileSync(savedFilePath, 'utf8')).toBe(rawFileContent)
+    })
+
+    it('should not attempt to unzip when content-type is image/png', async () => {
+      const pngFileName = 'screenshot.png'
+      // Simple PNG header bytes for testing
+      const pngContent = Buffer.from([
+        0x89, 0x50, 0x4e, 0x47, 0x0d, 0x0a, 0x1a, 0x0a
+      ])
+
+      const mockGetPngFile = jest.fn(() => {
+        const message = new http.IncomingMessage(new net.Socket())
+        message.statusCode = 200
+        message.headers['content-type'] = 'image/png'
+        message.headers['content-disposition'] =
+          `attachment; filename="${pngFileName}"`
+        message.push(pngContent)
+        message.push(null)
+        return {
+          message
+        }
+      })
+
+      const mockHttpClient = (HttpClient as jest.Mock).mockImplementation(
+        () => {
+          return {
+            get: mockGetPngFile
+          }
+        }
+      )
+
+      await streamExtractExternal(
+        fixtures.blobStorageUrl,
+        fixtures.workspaceDir
+      )
+
+      expect(mockHttpClient).toHaveBeenCalledWith(getUserAgentString())
+      // Verify PNG was saved as-is
+      const savedFilePath = path.join(fixtures.workspaceDir, pngFileName)
+      expect(fs.existsSync(savedFilePath)).toBe(true)
+      expect(fs.readFileSync(savedFilePath)).toEqual(pngContent)
+    })
+
+    it('should extract when content-type is application/x-zip-compressed', async () => {
+      const mockGetZipCompressed = jest.fn(() => {
+        const message = new http.IncomingMessage(new net.Socket())
+        message.statusCode = 200
+        message.headers['content-type'] = 'application/x-zip-compressed'
+        message.push(fs.readFileSync(fixtures.exampleArtifact.path))
+        message.push(null)
+        return {
+          message
+        }
+      })
+
+      const mockHttpClient = (HttpClient as jest.Mock).mockImplementation(
+        () => {
+          return {
+            get: mockGetZipCompressed
+          }
+        }
+      )
+
+      await streamExtractExternal(
+        fixtures.blobStorageUrl,
+        fixtures.workspaceDir
+      )
+
+      expect(mockHttpClient).toHaveBeenCalledWith(getUserAgentString())
+      // Verify files were extracted
+      await expectExtractedArchive(fixtures.workspaceDir)
+    })
+
+    it('should skip decompression when skipDecompress option is true even for zip content-type', async () => {
+      const mockHttpClient = (HttpClient as jest.Mock).mockImplementation(
+        () => {
+          return {
+            get: mockGetArtifactSuccess
+          }
+        }
+      )
+
+      await streamExtractExternal(
+        fixtures.blobStorageUrl,
+        fixtures.workspaceDir,
+        {skipDecompress: true}
+      )
+
+      expect(mockHttpClient).toHaveBeenCalledWith(getUserAgentString())
+      // Verify zip was saved as-is, not extracted
+      // When skipDecompress is true, the file should be saved with default name 'artifact'
+      const savedFilePath = path.join(fixtures.workspaceDir, 'artifact')
+      expect(fs.existsSync(savedFilePath)).toBe(true)
+      // The saved file should be the raw zip content
+      const savedContent = fs.readFileSync(savedFilePath)
+      const originalZipContent = fs.readFileSync(fixtures.exampleArtifact.path)
+      expect(savedContent).toEqual(originalZipContent)
+    })
+
+    it('should sanitize path traversal attempts in Content-Disposition filename', async () => {
+      const rawFileContent = 'malicious content'
+      const maliciousFileName = '../../../etc/passwd'
+
+      const mockGetMaliciousFile = jest.fn(() => {
+        const message = new http.IncomingMessage(new net.Socket())
+        message.statusCode = 200
+        message.headers['content-type'] = 'text/plain'
+        message.headers['content-disposition'] =
+          `attachment; filename="${maliciousFileName}"`
+        message.push(Buffer.from(rawFileContent))
+        message.push(null)
+        return {
+          message
+        }
+      })
+
+      const mockHttpClient = (HttpClient as jest.Mock).mockImplementation(
+        () => {
+          return {
+            get: mockGetMaliciousFile
+          }
+        }
+      )
+
+      await streamExtractExternal(
+        fixtures.blobStorageUrl,
+        fixtures.workspaceDir
+      )
+
+      expect(mockHttpClient).toHaveBeenCalledWith(getUserAgentString())
+      // Verify file was saved with sanitized name (just 'passwd', not the full path)
+      const sanitizedFileName = 'passwd'
+      const savedFilePath = path.join(fixtures.workspaceDir, sanitizedFileName)
+      expect(fs.existsSync(savedFilePath)).toBe(true)
+      expect(fs.readFileSync(savedFilePath, 'utf8')).toBe(rawFileContent)
+
+      // Verify the file was NOT written outside the workspace directory
+      const maliciousPath = path.resolve(
+        fixtures.workspaceDir,
+        maliciousFileName
+      )
+      expect(fs.existsSync(maliciousPath)).toBe(false)
+    })
+
+    it('should handle encoded path traversal attempts in Content-Disposition filename', async () => {
+      const rawFileContent = 'encoded malicious content'
+      // URL encoded version of ../../../etc/passwd
+      const encodedMaliciousFileName = '..%2F..%2F..%2Fetc%2Fpasswd'
+
+      const mockGetEncodedMaliciousFile = jest.fn(() => {
+        const message = new http.IncomingMessage(new net.Socket())
+        message.statusCode = 200
+        message.headers['content-type'] = 'application/octet-stream'
+        message.headers['content-disposition'] =
+          `attachment; filename="${encodedMaliciousFileName}"`
+        message.push(Buffer.from(rawFileContent))
+        message.push(null)
+        return {
+          message
+        }
+      })
+
+      const mockHttpClient = (HttpClient as jest.Mock).mockImplementation(
+        () => {
+          return {
+            get: mockGetEncodedMaliciousFile
+          }
+        }
+      )
+
+      await streamExtractExternal(
+        fixtures.blobStorageUrl,
+        fixtures.workspaceDir
+      )
+
+      expect(mockHttpClient).toHaveBeenCalledWith(getUserAgentString())
+      // After decoding and sanitizing, should just be 'passwd'
+      const sanitizedFileName = 'passwd'
+      const savedFilePath = path.join(fixtures.workspaceDir, sanitizedFileName)
+      expect(fs.existsSync(savedFilePath)).toBe(true)
+      expect(fs.readFileSync(savedFilePath, 'utf8')).toBe(rawFileContent)
+
+      // Verify the file was NOT written outside the workspace directory
+      const maliciousPathEncoded = path.resolve(
+        fixtures.workspaceDir,
+        encodedMaliciousFileName
+      )
+      expect(fs.existsSync(maliciousPathEncoded)).toBe(false)
+
+      const maliciousPath = path.resolve(
+        fixtures.workspaceDir,
+        "../../../etc/passwd"
+      )
+      expect(fs.existsSync(maliciousPath)).toBe(false)
+    })
   })
 })
diff --git a/packages/artifact/src/internal/download/download-artifact.ts b/packages/artifact/src/internal/download/download-artifact.ts
index b760e77ab8..1ed22aeca3 100644
--- a/packages/artifact/src/internal/download/download-artifact.ts
+++ b/packages/artifact/src/internal/download/download-artifact.ts
@@ -1,6 +1,8 @@
 import fs from 'fs/promises'
+import * as fsSync from 'fs'
 import * as crypto from 'crypto'
 import * as stream from 'stream'
+import * as path from 'path'
 
 import * as github from '@actions/github'
 import * as core from '@actions/core'
@@ -43,12 +45,13 @@ async function exists(path: string): Promise<boolean> {
 
 async function streamExtract(
   url: string,
-  directory: string
+  directory: string,
+  skipDecompress?: boolean
 ): Promise<StreamExtractResponse> {
   let retryCount = 0
   while (retryCount < 5) {
     try {
-      return await streamExtractExternal(url, directory)
+      return await streamExtractExternal(url, directory, {skipDecompress})
     } catch (error) {
       retryCount++
       core.debug(
@@ -65,8 +68,9 @@ async function streamExtract(
 export async function streamExtractExternal(
   url: string,
   directory: string,
-  opts: {timeout: number} = {timeout: 30 * 1000}
+  opts: {timeout?: number; skipDecompress?: boolean} = {}
 ): Promise<StreamExtractResponse> {
+  const {timeout = 30 * 1000, skipDecompress = false} = opts
   const client = new httpClient.HttpClient(getUserAgentString())
   const response = await client.get(url)
   if (response.message.statusCode !== 200) {
@@ -75,49 +79,85 @@ export async function streamExtractExternal(
     )
   }
 
+  const contentType = response.message.headers['content-type'] || ''
+  const mimeType = contentType.split(';', 1)[0].trim().toLowerCase()
+  const isZip =
+    mimeType === 'application/zip' ||
+    mimeType === 'application/x-zip-compressed' ||
+    mimeType === 'application/zip-compressed'
+
+  // Extract filename from Content-Disposition header
+  const contentDisposition =
+    response.message.headers['content-disposition'] || ''
+  let fileName = 'artifact'
+  const filenameMatch = contentDisposition.match(
+    /filename\*?=['"]?(?:UTF-\d['"]*)?([^;\r\n"']*)['"]?/i
+  )
+  if (filenameMatch && filenameMatch[1]) {
+    // Sanitize fileName to prevent path traversal attacks
+    // Use path.basename to extract only the filename component
+    fileName = path.basename(decodeURIComponent(filenameMatch[1].trim()))
+  }
+
+  core.debug(
+    `Content-Type: ${contentType}, isZip: ${isZip}, skipDecompress: ${skipDecompress}`
+  )
+  core.debug(
+    `Content-Disposition: ${contentDisposition}, fileName: ${fileName}`
+  )
+
   let sha256Digest: string | undefined = undefined
 
   return new Promise((resolve, reject) => {
     const timerFn = (): void => {
       const timeoutError = new Error(
-        `Blob storage chunk did not respond in ${opts.timeout}ms`
+        `Blob storage chunk did not respond in ${timeout}ms`
       )
       response.message.destroy(timeoutError)
       reject(timeoutError)
     }
-    const timer = setTimeout(timerFn, opts.timeout)
+    const timer = setTimeout(timerFn, timeout)
+
+    const onError = (error: Error): void => {
+      core.debug(`response.message: Artifact download failed: ${error.message}`)
+      clearTimeout(timer)
+      reject(error)
+    }
 
     const hashStream = crypto.createHash('sha256').setEncoding('hex')
     const passThrough = new stream.PassThrough()
+      .on('data', () => {
+        timer.refresh()
+      })
+      .on('error', onError)
 
     response.message.pipe(passThrough)
     passThrough.pipe(hashStream)
-    const extractStream = passThrough
 
-    extractStream
-      .on('data', () => {
-        timer.refresh()
-      })
-      .on('error', (error: Error) => {
-        core.debug(
-          `response.message: Artifact download failed: ${error.message}`
-        )
-        clearTimeout(timer)
-        reject(error)
-      })
-      .pipe(unzip.Extract({path: directory}))
-      .on('close', () => {
-        clearTimeout(timer)
-        if (hashStream) {
-          hashStream.end()
-          sha256Digest = hashStream.read() as string
-          core.info(`SHA256 digest of downloaded artifact is ${sha256Digest}`)
-        }
-        resolve({sha256Digest: `sha256:${sha256Digest}`})
-      })
-      .on('error', (error: Error) => {
-        reject(error)
-      })
+    const onClose = (): void => {
+      clearTimeout(timer)
+      if (hashStream) {
+        hashStream.end()
+        sha256Digest = hashStream.read() as string
+        core.info(`SHA256 digest of downloaded artifact is ${sha256Digest}`)
+      }
+      resolve({sha256Digest: `sha256:${sha256Digest}`})
+    }
+
+    if (isZip && !skipDecompress) {
+      // Extract zip file
+      passThrough
+        .pipe(unzip.Extract({path: directory}))
+        .on('close', onClose)
+        .on('error', onError)
+    } else {
+      // Save raw file without extracting
+      const filePath = path.join(directory, fileName)
+      const writeStream = fsSync.createWriteStream(filePath)
+
+      core.info(`Downloading raw file (non-zip) to: ${filePath}`)
+      passThrough.pipe(writeStream).on('close', onClose).on('error', onError)
+    }
   })
 }
 
@@ -163,7 +203,11 @@ export async function downloadArtifactPublic(
 
   try {
     core.info(`Starting download of artifact to: ${downloadPath}`)
-    const extractResponse = await streamExtract(location, downloadPath)
+    const extractResponse = await streamExtract(
+      location,
+      downloadPath,
+      options?.skipDecompress
+    )
     core.info(`Artifact download completed successfully.`)
     if (options?.expectedHash) {
       if (options?.expectedHash !== extractResponse.sha256Digest) {
@@ -224,7 +268,11 @@ export async function downloadArtifactInternal(
 
   try {
     core.info(`Starting download of artifact to: ${downloadPath}`)
-    const extractResponse = await streamExtract(signedUrl, downloadPath)
+    const extractResponse = await streamExtract(
+      signedUrl,
+      downloadPath,
+      options?.skipDecompress
+    )
     core.info(`Artifact download completed successfully.`)
     if (options?.expectedHash) {
       if (options?.expectedHash !== extractResponse.sha256Digest) {
diff --git a/packages/artifact/src/internal/shared/interfaces.ts b/packages/artifact/src/internal/shared/interfaces.ts
index 9675d39a3e..784ff98d1b 100644
--- a/packages/artifact/src/internal/shared/interfaces.ts
+++ b/packages/artifact/src/internal/shared/interfaces.ts
@@ -113,6 +113,12 @@ export interface DownloadArtifactOptions {
    * matches the expected hash.
    */
   expectedHash?: string
+
+  /**
+   * If true, the downloaded artifact will not be automatically extracted/decompressed.
+   * The artifact will be saved as-is to the destination path.
+   */
+  skipDecompress?: boolean
 }
 
 export interface StreamExtractResponse {