The issue is that your file is not correctly downloaded by https module which result in extraction error from tar.gz module.

You can use request module coordinated with tar.gz with createWriteStream to pipe the extraction directly to the destination folder :

var request = require('request');
var targz = require('tar.gz');

function downloadFile(source, destination, cb) {
    var read = request.get(source);
    var write = targz().createWriteStream(destination);

    read.pipe(write);

    write.on('finish', function() {
        cb(null);
    });

    write.on('error', function(err) {
        cb(err);
    });
}

var source = "https://gitlab.com/api/v3/projects/:ID/repository/archive?token=XXYYZZ";
var destination = "/home/user/some/dir";

downloadFile(source, destination, function(err) {
    if (err) {
        console.log('Something is wrong ', err.stack);
    } else {
        console.log('Job done!');
    }
});

Note that, for the finish event to be dispatched you will need version 1.0.2 of tar.gz (see this issue) :

npm install [email protected]