diff --git a/myst_parser/mdit_to_docutils/base.py b/myst_parser/mdit_to_docutils/base.py
index 68cfae72..fae8273b 100644
--- a/myst_parser/mdit_to_docutils/base.py
+++ b/myst_parser/mdit_to_docutils/base.py
@@ -1973,25 +1973,46 @@ def render_substitution(self, token: SyntaxTreeNode, inline: bool) -> None:
         # fail on undefined variables
         env = jinja2.Environment(undefined=jinja2.StrictUndefined)
 
-        # try rendering
-        try:
-            rendered = env.from_string(f"{{{{{token.content}}}}}").render(
-                variable_context
-            )
-        except Exception as error:
-            self.create_warning(
-                f"Substitution error:{error.__class__.__name__}: {error}",
-                MystWarnings.SUBSTITUTION,
-                line=position,
-                append_to=self.current_node,
-            )
-            return
+        content = token.content.strip()
+
+        if content in variable_context:
+            # Fast path for a substitution whose content is exactly a
+            # known key, looked up directly rather than through Jinja2
+            # expression parsing. This is required (not just an
+            # optimisation) for keys containing characters that are
+            # invalid in a Jinja2 identifier -- most commonly a dash,
+            # e.g. `foo-bar` -- which Jinja2 would otherwise parse as
+            # an *expression* (`foo - bar`, a subtraction of two
+            # separate, likely-undefined names) rather than as a
+            # single variable reference. See GH #1007.
+            #
+            # This only applies when the whole substitution is exactly
+            # one known key; anything else (arbitrary Jinja2
+            # expressions, filters, dotted attribute access, etc.)
+            # still goes through the normal Jinja2 rendering path
+            # below, unaffected.
+            rendered = str(variable_context[content])
+            references = set() if content == "env" else {content}
+        else:
+            # try rendering
+            try:
+                rendered = env.from_string(f"{{{{{token.content}}}}}").render(
+                    variable_context
+                )
+            except Exception as error:
+                self.create_warning(
+                    f"Substitution error:{error.__class__.__name__}: {error}",
+                    MystWarnings.SUBSTITUTION,
+                    line=position,
+                    append_to=self.current_node,
+                )
+                return
 
-        # handle circular references
-        ast = env.parse(f"{{{{{token.content}}}}}")
-        references = {
-            n.name for n in ast.find_all(jinja2.nodes.Name) if n.name != "env"
-        }
+            # handle circular references
+            ast = env.parse(f"{{{{{token.content}}}}}")
+            references = {
+                n.name for n in ast.find_all(jinja2.nodes.Name) if n.name != "env"
+            }
         self.document.sub_references = getattr(self.document, "sub_references", set())
         cyclic = references.intersection(self.document.sub_references)
         if cyclic:
diff --git a/tests/test_sphinx/sourcedirs/substitutions_dashed_key/conf.py b/tests/test_sphinx/sourcedirs/substitutions_dashed_key/conf.py
new file mode 100644
index 00000000..8e34bd70
--- /dev/null
+++ b/tests/test_sphinx/sourcedirs/substitutions_dashed_key/conf.py
@@ -0,0 +1,9 @@
+extensions = ["myst_parser"]
+exclude_patterns = ["_build"]
+myst_enable_extensions = ["substitution"]
+myst_substitutions = {
+    "foo-bar": "Foobar",
+    "plain": "PlainValue",
+    "circ-a": "{{circ-b}}",
+    "circ-b": "{{circ-a}}",
+}
diff --git a/tests/test_sphinx/sourcedirs/substitutions_dashed_key/index.md b/tests/test_sphinx/sourcedirs/substitutions_dashed_key/index.md
new file mode 100644
index 00000000..680ee7c9
--- /dev/null
+++ b/tests/test_sphinx/sourcedirs/substitutions_dashed_key/index.md
@@ -0,0 +1,7 @@
+# Title
+
+Dashed key: {{foo-bar}}
+
+Plain key: {{plain}}
+
+Circular: {{circ-a}}
diff --git a/tests/test_sphinx/test_sphinx_builds.py b/tests/test_sphinx/test_sphinx_builds.py
index 333b24dc..4a877e4b 100644
--- a/tests/test_sphinx/test_sphinx_builds.py
+++ b/tests/test_sphinx/test_sphinx_builds.py
@@ -472,6 +472,42 @@ def test_substitutions_missing(
     )
 
 
+@pytest.mark.sphinx(
+    buildername="html",
+    srcdir=os.path.join(SOURCE_DIR, "substitutions_dashed_key"),
+    freshenv=True,
+)
+def test_substitutions_dashed_key(
+    app,
+    status,
+    warning,
+    get_sphinx_app_output,
+):
+    """
+    Regression test for
+    https://github.com/executablebooks/MyST-Parser/issues/1007
+
+    A substitution key containing a dash (e.g. ``foo-bar``) must be
+    looked up as a single key, not parsed by Jinja2 as a subtraction
+    expression (``foo - bar``, two separate, likely-undefined names).
+    Plain keys and circular-reference detection must continue to work
+    as before.
+    """
+    app.build()
+    assert "build succeeded" in status.getvalue()
+
+    warnings = warning.getvalue().strip().splitlines()
+    assert len(warnings) == 1
+    assert "circular substitution reference: {'circ-a'}" in warnings[0]
+
+    output = get_sphinx_app_output(app, filename="index.html")
+    assert "Foobar" in output
+    assert "PlainValue" in output
+    # The circular substitution should not have rendered a value.
+    assert "{{circ-a}}" not in output
+    assert "{{circ-b}}" not in output
+
+
 @pytest.mark.sphinx(
     buildername="gettext", srcdir=os.path.join(SOURCE_DIR, "gettext"), freshenv=True
 )