diff --git a/devenv/dev-dashboards/feature-templating/templating-dashboard-links-and-variables.json b/devenv/dev-dashboards/feature-templating/templating-dashboard-links-and-variables.json
index f5751ec42f5..ab94db3f055 100644
--- a/devenv/dev-dashboards/feature-templating/templating-dashboard-links-and-variables.json
+++ b/devenv/dev-dashboards/feature-templating/templating-dashboard-links-and-variables.json
@@ -16,7 +16,7 @@
   "gnetId": null,
   "graphTooltip": 0,
   "id": null,
-  "iteration": 1601526910610,
+  "iteration": 1646409057541,
   "links": [
     {
       "icon": "external link",
@@ -73,6 +73,61 @@
       "timeShift": null,
       "title": "${custom.text}",
       "type": "text"
+    },
+    {
+      "id": 4,
+      "gridPos": {
+        "h": 9,
+        "w": 9,
+        "x": 12,
+        "y": 0
+      },
+      "type": "stat",
+      "title": "Panel Title",
+      "fieldConfig": {
+        "defaults": {
+          "mappings": [],
+          "thresholds": {
+            "mode": "absolute",
+            "steps": [
+              {
+                "color": "green",
+                "value": null
+              },
+              {
+                "color": "red",
+                "value": 80
+              }
+            ]
+          },
+          "color": {
+            "mode": "thresholds"
+          },
+          "links": [
+            {
+              "title": "Var Link",
+              "url": "/d/vmie2cmWz/bar-gauge-demo?var-custom=$custom"
+            }
+          ]
+        },
+        "overrides": []
+      },
+      "options": {
+        "reduceOptions": {
+          "values": false,
+          "calcs": [
+            "lastNotNull"
+          ],
+          "fields": ""
+        },
+        "orientation": "auto",
+        "textMode": "auto",
+        "colorMode": "value",
+        "graphMode": "area",
+        "justifyMode": "auto"
+      },
+      "pluginVersion": "8.5.0-pre",
+      "datasource": null
     }
   ],
   "schemaVersion": 26,
@@ -112,6 +167,11 @@
             "selected": false,
             "text": "p3",
             "value": "p3"
+          },
+          {
+            "selected": false,
+            "text": "p4",
+            "value": "test%25value"
           }
         ],
         "query": "p1,p2,p3",
diff --git a/e2e/dashboards-suite/templating-dashboard-links-and-variables.spec.ts b/e2e/dashboards-suite/templating-dashboard-links-and-variables.spec.ts
index c2eb79f780c..2c4fe236baf 100644
--- a/e2e/dashboards-suite/templating-dashboard-links-and-variables.spec.ts
+++ b/e2e/dashboards-suite/templating-dashboard-links-and-variables.spec.ts
@@ -34,7 +34,7 @@ e2e.scenario({
           expect(links).to.have.length.greaterThan(13);
 
           for (let index = 0; index < links.length; index++) {
-            expect(Cypress.$(links[index]).attr('href')).contains(`var-custom=${variableValue}`);
+            expect(Cypress.$(links[index]).attr('href')).contains(`var-custom=${encodeURI(variableValue)}`);
           }
         });
     };
@@ -44,6 +44,14 @@ e2e.scenario({
     // verify all links, should have All value
     verifyLinks('All');
 
+    // Data links should percent encode var values
+    e2e()
+      .get('[aria-label="Data link"]')
+      .should('exist')
+      .and((link) => {
+        expect(link.attr('href')).contains(encodeURI('test%25value'));
+      });
+
     e2e.pages.Dashboard.SubMenu.submenuItemValueDropDownValueLinkTexts('All').should('be.visible').click();
 
     e2e.pages.Dashboard.SubMenu.submenuItemValueDropDownOptionTexts('p2').should('be.visible').click();
diff --git a/packages/grafana-data/src/field/fieldOverrides.ts b/packages/grafana-data/src/field/fieldOverrides.ts
index a2292847c2f..d6358395d80 100644
--- a/packages/grafana-data/src/field/fieldOverrides.ts
+++ b/packages/grafana-data/src/field/fieldOverrides.ts
@@ -1,7 +1,6 @@
 import {
   ApplyFieldOverrideOptions,
   DataFrame,
-  DataLink,
   DisplayProcessor,
   DisplayValue,
   DynamicConfigValue,
@@ -353,7 +352,7 @@ export const getLinksSupplier =
     const timeRangeUrl = locationUtil.getTimeRangeUrlParams();
     const { timeField } = getTimeField(frame);
 
-    return field.config.links.map((link: DataLink) => {
+    return field.config.links.map((link) => {
       const variablesQuery = locationUtil.getVariablesUrlParams();
       let dataFrameVars = {};
       let valueVars = {};
@@ -439,7 +438,7 @@ export const getLinksSupplier =
       }
 
       let href = locationUtil.assureBaseUrl(link.url.replace(/\n/g, ''));
-      href = replaceVariables(href, variables);
+      href = replaceVariables(href, variables, encodeURIComponent);
       href = locationUtil.processUrl(href);
 
       const info: LinkModel<Field> = {