diff --git a/package/libgit2/0001-sysdir-Do-not-declare-win32-functions-on-non-win32-p.patch b/package/libgit2/0001-sysdir-Do-not-declare-win32-functions-on-non-win32-p.patch
new file mode 100644
index 0000000000..6be66ffee3
--- /dev/null
+++ b/package/libgit2/0001-sysdir-Do-not-declare-win32-functions-on-non-win32-p.patch
@@ -0,0 +1,35 @@
+From 20811c5aa9c528405eaa3f88ff22a9adebafa9e6 Mon Sep 17 00:00:00 2001
+From: Nicolas Cavallari <nicolas.cavallari@green-communications.fr>
+Date: Wed, 8 Mar 2023 14:00:52 +0100
+Subject: [PATCH] sysdir: Do not declare win32 functions on non-win32 platforms
+
+These declaration poses problems on some embedded or retro Linux systems
+that deliberately disable support for wchar_t from their libc.
+
+Signed-off-by: Nicolas Cavallari <nicolas.cavallari@green-communications.fr>
+[Retrieved from:
+https://github.com/libgit2/libgit2/commit/20811c5aa9c528405eaa3f88ff22a9adebafa9e6]
+---
+ src/libgit2/sysdir.h | 2 ++
+ 1 file changed, 2 insertions(+)
+
+diff --git a/src/libgit2/sysdir.h b/src/libgit2/sysdir.h
+index 1d15bbf43..03f59e1de 100644
+--- a/src/libgit2/sysdir.h
++++ b/src/libgit2/sysdir.h
+@@ -134,10 +134,12 @@ extern int git_sysdir_set(git_sysdir_t which, const char *paths);
+  */
+ extern int git_sysdir_reset(void);
+ 
++#ifdef GIT_WIN32
+ /** Sets the registry system dir to a mock; for testing.  */
+ extern int git_win32__set_registry_system_dir(const wchar_t *mock_sysdir);
+ 
+ /** Find the given system dir; for testing. */
+ extern int git_win32__find_system_dirs(git_str *out, const char *subdir);
++#endif
+ 
+ #endif
+-- 
+2.39.2
+
diff --git a/package/libgit2/libgit2.hash b/package/libgit2/libgit2.hash
index e834525df5..baf43c66f7 100644
--- a/package/libgit2/libgit2.hash
+++ b/package/libgit2/libgit2.hash
@@ -1,3 +1,3 @@
 # Locally calculated
-sha256  7074f1e2697992b82402501182db254fe62d64877b12f6e4c64656516f4cde88  libgit2-1.5.1.tar.gz
-sha256  0fc09da43d666b5b0cf5695defc3100d5cf387936b260ebab37e396d7e0dbc83  COPYING
+sha256  d557fbf35557bb5df53cbf38ae0081edb4a36494ec0d19741fa673e509245f8f  libgit2-1.6.2.tar.gz
+sha256  6f3c2cd59b057e366c1acc073b038135c52d77892bb33bd4d931c5369d3f062b  COPYING
diff --git a/package/libgit2/libgit2.mk b/package/libgit2/libgit2.mk
index c962c8030f..b31f5199e1 100644
--- a/package/libgit2/libgit2.mk
+++ b/package/libgit2/libgit2.mk
@@ -4,14 +4,15 @@
 #
 ################################################################################
 
-LIBGIT2_VERSION = 1.5.1
+LIBGIT2_VERSION = 1.6.2
 LIBGIT2_SITE = $(call github,libgit2,libgit2,v$(LIBGIT2_VERSION))
 LIBGIT2_LICENSE = \
 	GPL-2.0 with linking exception, \
 	MIT (sha1), \
 	BSD-3-Clause (sha256), \
 	wildmatch license (wildmatch), \
-	CC0-1.0 (xoroshiro256)
+	CC0-1.0 (xoroshiro256), \
+	BSD-2-Clause (basename_r)
 LIBGIT2_LICENSE_FILES = COPYING
 LIBGIT2_CPE_ID_VENDOR = libgit2_project
 LIBGIT2_INSTALL_STAGING = YES
@@ -24,6 +25,8 @@ LIBGIT2_CONF_OPTS = \
 	-DUSE_NTLMCLIENT=OFF \
 	-DUSE_THREADS=$(if $(BR2_TOOLCHAIN_HAS_THREADS),ON,OFF)
 
+LIBGIT2_SUPPORTS_IN_SOURCE_BUILD = NO
+
 LIBGIT2_DEPENDENCIES = zlib libhttpparser
 
 # If libiconv is available (for !locale toolchains), then we can use