diff --git a/msal/application.py b/msal/application.py
index 260d80e..e46d748 100644
--- a/msal/application.py
+++ b/msal/application.py
@@ -22,7 +22,7 @@
 
 
 # The __init__.py will import this. Not the other way around.
-__version__ = "1.31.0"  # When releasing, also check and bump our dependencies's versions if needed
+__version__ = "1.31.1"  # When releasing, also check and bump our dependencies's versions if needed
 
 logger = logging.getLogger(__name__)
 _AUTHORITY_TYPE_CLOUDSHELL = "CLOUDSHELL"
diff --git a/msal/managed_identity.py b/msal/managed_identity.py
index 608bc1b..bad96a0 100644
--- a/msal/managed_identity.py
+++ b/msal/managed_identity.py
@@ -346,10 +346,12 @@ def _scope_to_resource(scope):  # This is an experimental reasonable-effort appr
 def _get_arc_endpoint():
     if "IDENTITY_ENDPOINT" in os.environ and "IMDS_ENDPOINT" in os.environ:
         return os.environ["IDENTITY_ENDPOINT"]
-    if (  # Defined in https://msazure.visualstudio.com/One/_wiki/wikis/One.wiki/233012/VM-Extension-Authoring-for-Arc?anchor=determining-which-endpoint-to-use
-        sys.platform == "linux" and os.path.exists("/var/opt/azcmagent/bin/himds")
+    if (  # Defined in https://eng.ms/docs/cloud-ai-platform/azure-core/azure-management-and-platforms/control-plane-bburns/hybrid-resource-provider/azure-arc-for-servers/specs/extension_authoring
+        sys.platform == "linux" and os.path.exists("/opt/azcmagent/bin/himds")
         or sys.platform == "win32" and os.path.exists(os.path.expandvars(
-            r"%ProgramFiles%\AzureConnectedMachineAgent\himds.exe"))
+            # Avoid Windows-only "%EnvVar%" syntax so that tests can be run on Linux
+            r"${ProgramFiles}\AzureConnectedMachineAgent\himds.exe"
+        ))
     ):
         return "http://localhost:40342/metadata/identity/oauth2/token"
 
diff --git a/tests/test_mi.py b/tests/test_mi.py
index 1f33fe7..c5a99ae 100644
--- a/tests/test_mi.py
+++ b/tests/test_mi.py
@@ -347,9 +347,23 @@ def test_machine_learning(self):
         "IDENTITY_ENDPOINT": "http://localhost",
         "IMDS_ENDPOINT": "http://localhost",
     })
-    def test_arc(self):
+    def test_arc_by_env_var(self):
         self.assertEqual(get_managed_identity_source(), AZURE_ARC)
 
+    @patch("msal.managed_identity.os.path.exists", return_value=True)
+    @patch("msal.managed_identity.sys.platform", new="linux")
+    def test_arc_by_file_existence_on_linux(self, mocked_exists):
+        self.assertEqual(get_managed_identity_source(), AZURE_ARC)
+        mocked_exists.assert_called_with("/opt/azcmagent/bin/himds")
+
+    @patch("msal.managed_identity.os.path.exists", return_value=True)
+    @patch("msal.managed_identity.sys.platform", new="win32")
+    @patch.dict(os.environ, {"ProgramFiles": "C:\Program Files"})
+    def test_arc_by_file_existence_on_windows(self, mocked_exists):
+        self.assertEqual(get_managed_identity_source(), AZURE_ARC)
+        mocked_exists.assert_called_with(
+            r"C:\Program Files\AzureConnectedMachineAgent\himds.exe")
+
     @patch.dict(os.environ, {
         "AZUREPS_HOST_ENVIRONMENT": "cloud-shell-foo",
     })