diff --git a/news/2 Fixes/15439.md b/news/2 Fixes/15439.md
new file mode 100644
index 000000000000..e6e4b7429126
--- /dev/null
+++ b/news/2 Fixes/15439.md	
@@ -0,0 +1 @@
+Fix for missing pyenv virtual environments from selectable environments.
diff --git a/src/client/pythonEnvironments/common/externalDependencies.ts b/src/client/pythonEnvironments/common/externalDependencies.ts
index 062a8923245c..059a0bdd387f 100644
--- a/src/client/pythonEnvironments/common/externalDependencies.ts
+++ b/src/client/pythonEnvironments/common/externalDependencies.ts
@@ -97,23 +97,35 @@ export async function getFileInfo(filePath: string): Promise<{ ctime: number; mt
     }
 }
 
-export async function resolveSymbolicLink(filepath: string): Promise<string> {
-    const stats = await fsapi.lstat(filepath);
+export async function resolveSymbolicLink(absPath: string): Promise<string> {
+    const stats = await fsapi.lstat(absPath);
     if (stats.isSymbolicLink()) {
-        const link = await fsapi.readlink(filepath);
+        const link = await fsapi.readlink(absPath);
         return resolveSymbolicLink(link);
     }
-    return filepath;
+    return absPath;
 }
 
-export async function* getSubDirs(root: string): AsyncIterableIterator<string> {
-    const dirContents = await fsapi.readdir(root);
+/**
+ * Returns full path to sub directories of a given directory.
+ * @param root
+ * @param resolveSymlinks
+ */
+export async function* getSubDirs(root: string, resolveSymlinks: boolean): AsyncIterableIterator<string> {
+    const dirContents = await fsapi.promises.readdir(root, { withFileTypes: true });
     const generators = dirContents.map((item) => {
         async function* generator() {
-            const stat = await fsapi.lstat(path.join(root, item));
-
-            if (stat.isDirectory()) {
-                yield item;
+            const fullPath = path.join(root, item.name);
+            if (item.isDirectory()) {
+                yield fullPath;
+            } else if (resolveSymlinks && item.isSymbolicLink()) {
+                // The current FS item is a symlink. It can potentially be a file
+                // or a directory. Resolve it first and then check if it is a directory.
+                const resolvedPath = await resolveSymbolicLink(fullPath);
+                const resolvedPathStat = await fsapi.lstat(resolvedPath);
+                if (resolvedPathStat.isDirectory()) {
+                    yield resolvedPath;
+                }
             }
         }
 
diff --git a/src/client/pythonEnvironments/discovery/locators/services/pyenvLocator.ts b/src/client/pythonEnvironments/discovery/locators/services/pyenvLocator.ts
index ddac1574932d..550dffa3dafc 100644
--- a/src/client/pythonEnvironments/discovery/locators/services/pyenvLocator.ts
+++ b/src/client/pythonEnvironments/discovery/locators/services/pyenvLocator.ts
@@ -259,15 +259,15 @@ export function parsePyenvVersion(str: string): Promise<IPyenvVersionStrings | u
 async function* getPyenvEnvironments(): AsyncIterableIterator<PythonEnvInfo> {
     const pyenvVersionDir = getPyenvVersionsDir();
 
-    const subDirs = getSubDirs(pyenvVersionDir);
-    for await (const subDir of subDirs) {
-        const envDir = path.join(pyenvVersionDir, subDir);
-        const interpreterPath = await getInterpreterPathFromDir(envDir);
+    const subDirs = getSubDirs(pyenvVersionDir, true);
+    for await (const subDirPath of subDirs) {
+        const envDirName = path.basename(subDirPath);
+        const interpreterPath = await getInterpreterPathFromDir(subDirPath);
 
         if (interpreterPath) {
             // The sub-directory name sometimes can contain distro and python versions.
             // here we attempt to extract the texts out of the name.
-            const versionStrings = await parsePyenvVersion(subDir);
+            const versionStrings = await parsePyenvVersion(envDirName);
 
             // Here we look for near by files, or config files to see if we can get python version info
             // without running python itself.
@@ -290,7 +290,7 @@ async function* getPyenvEnvironments(): AsyncIterableIterator<PythonEnvInfo> {
             // `pyenv local|global <env-name>` or `pyenv shell <env-name>`
             //
             // For the display name we are going to treat these as `pyenv` environments.
-            const display = `${subDir}:pyenv`;
+            const display = `${envDirName}:pyenv`;
 
             const org = versionStrings && versionStrings.distro ? versionStrings.distro : '';
 
@@ -299,14 +299,14 @@ async function* getPyenvEnvironments(): AsyncIterableIterator<PythonEnvInfo> {
             const envInfo = buildEnvInfo({
                 kind: PythonEnvKind.Pyenv,
                 executable: interpreterPath,
-                location: envDir,
+                location: subDirPath,
                 version: pythonVersion,
                 source: [PythonEnvSource.Pyenv],
                 display,
                 org,
                 fileInfo,
             });
-            envInfo.name = subDir;
+            envInfo.name = envDirName;
 
             yield envInfo;
         }