diff --git a/dev/archery/archery/docker/cli.py b/dev/archery/archery/docker/cli.py
index e6baf0ca1f002..7053db2afccff 100644
--- a/dev/archery/archery/docker/cli.py
+++ b/dev/archery/archery/docker/cli.py
@@ -77,7 +77,9 @@ def docker(ctx, src, dry_run, using_docker_cli, using_docker_buildx):
     compose = DockerCompose(config_path, params=os.environ,
                             using_docker=using_docker_cli,
                             using_buildx=using_docker_buildx,
-                            debug=ctx.obj.get('debug', False))
+                            debug=ctx.obj.get('debug', False),
+                            compose_bin=("docker compose" if using_docker_cli
+                                         else "docker-compose"))
     if dry_run:
         _mock_compose_calls(compose)
     ctx.obj['compose'] = compose
diff --git a/dev/archery/archery/docker/core.py b/dev/archery/archery/docker/core.py
index 38720e5856a14..0b49111dd6944 100644
--- a/dev/archery/archery/docker/core.py
+++ b/dev/archery/archery/docker/core.py
@@ -402,6 +402,10 @@ def run(self, service_name, command=None, *, env=None, volumes=None,
                     # on the docker-compose yaml file.
                     if isinstance(cmd, list):
                         cmd = shlex.join(cmd)
+                    # Match behaviour from docker compose
+                    # to interpolate environment variables
+                    # https://docs.docker.com/compose/compose-file/12-interpolation/
+                    cmd = cmd.replace("$$", "$")
                     args.extend(shlex.split(cmd))
 
             # execute as a plain docker cli command