diff --git a/lib/ansible/utils/path.py b/lib/ansible/utils/path.py
index 717cef6cf01..41ed017ef43 100644
--- a/lib/ansible/utils/path.py
+++ b/lib/ansible/utils/path.py
@@ -45,7 +45,7 @@ def unfrackpath(path, follow=True, basedir=None):
 
     if basedir is None:
         basedir = os.getcwd()
-    elif os.path.isfile(basedir):
+    elif os.path.isfile(to_bytes(basedir, errors='surrogate_or_strict')):
         basedir = os.path.dirname(basedir)
 
     final_path = os.path.expanduser(os.path.expandvars(to_bytes(path, errors='surrogate_or_strict')))