diff --git a/sqlx-core/src/postgres/options/parse.rs b/sqlx-core/src/postgres/options/parse.rs
index e5dd27fd..dce2bad5 100644
--- a/sqlx-core/src/postgres/options/parse.rs
+++ b/sqlx-core/src/postgres/options/parse.rs
@@ -1,5 +1,6 @@
 use crate::error::Error;
 use crate::postgres::PgConnectOptions;
+use percent_encoding::percent_decode_str;
 use std::str::FromStr;
 use url::Url;
 
@@ -21,11 +22,19 @@ impl FromStr for PgConnectOptions {
 
         let username = url.username();
         if !username.is_empty() {
-            options = options.username(username);
+            options = options.username(
+                &*percent_decode_str(username)
+                    .decode_utf8()
+                    .map_err(Error::config)?,
+            );
         }
 
         if let Some(password) = url.password() {
-            options = options.password(password);
+            options = options.password(
+                &*percent_decode_str(password)
+                    .decode_utf8()
+                    .map_err(Error::config)?,
+            );
         }
 
         let path = url.path().trim_start_matches('/');
@@ -80,3 +89,19 @@ fn it_parses_host_correctly_from_parameter() {
     assert_eq!(None, opts.socket);
     assert_eq!("google.database.com", &opts.host);
 }
+
+#[test]
+fn it_parses_username_with_at_sign_correctly() {
+    let uri = "postgres://user@hostname:password@hostname:5432/database";
+    let opts = PgConnectOptions::from_str(uri).unwrap();
+
+    assert_eq!("user@hostname", &opts.username);
+}
+
+#[test]
+fn it_parses_password_with_non_ascii_chars_correctly() {
+    let uri = "postgres://username:p@ssw0rd@hostname:5432/database";
+    let opts = PgConnectOptions::from_str(uri).unwrap();
+
+    assert_eq!(Some("p@ssw0rd".into()), opts.password);
+}