diff --git a/src/install/PackageManager/PackageManagerEnqueue.zig b/src/install/PackageManager/PackageManagerEnqueue.zig
index 9df5508e74..d7bea30549 100644
--- a/src/install/PackageManager/PackageManagerEnqueue.zig
+++ b/src/install/PackageManager/PackageManagerEnqueue.zig
@@ -1611,6 +1611,31 @@ fn getOrPutResolvedPackage(
                             }
                         }
                     }
+                } else if (version.tag == .dist_tag) {
+                    if (this.options.link_workspace_packages) {
+                        const workspace_path = if (this.lockfile.workspace_paths.count() > 0)
+                            this.lockfile.workspace_paths.get(name_hash)
+                        else
+                            null;
+                        if (workspace_path != null) {
+                            const root_package = this.lockfile.rootPackage() orelse break :resolve_from_workspace;
+                            const root_dependencies = root_package.dependencies.get(this.lockfile.buffers.dependencies.items);
+                            const root_resolutions = root_package.resolutions.get(this.lockfile.buffers.resolutions.items);
+
+                            for (root_dependencies, root_resolutions) |root_dep, workspace_package_id| {
+                                if (workspace_package_id != invalid_package_id and
+                                    root_dep.version.tag == .workspace and
+                                    root_dep.name_hash == name_hash)
+                                {
+                                    successFn(this, dependency_id, workspace_package_id);
+                                    return .{
+                                        .package = this.lockfile.packages.get(workspace_package_id),
+                                        .is_first_time = false,
+                                    };
+                                }
+                            }
+                        }
+                    }
                 }
             }
 
diff --git a/src/install/lockfile/Package.zig b/src/install/lockfile/Package.zig
index 48c8970699..39f0fad0f4 100644
--- a/src/install/lockfile/Package.zig
+++ b/src/install/lockfile/Package.zig
@@ -1121,6 +1121,24 @@ pub fn Package(comptime SemverIntType: type) type {
                         }
                     }
                 },
+                .dist_tag => {
+                    if (workspace_path != null and pm.options.link_workspace_packages) {
+                        const path = workspace_path.?.sliced(buf);
+                        if (Dependency.parseWithTag(
+                            allocator,
+                            external_alias.value,
+                            external_alias.hash,
+                            path.slice,
+                            .workspace,
+                            &path,
+                            log,
+                            pm,
+                        )) |dep| {
+                            dependency_version.tag = dep.tag;
+                            dependency_version.value = dep.value;
+                        }
+                    }
+                },
                 .workspace => workspace: {
                     if (workspace_path) |path| {
                         if (workspace_range) |range| {
diff --git a/test/cli/install/__snapshots__/bun-workspaces.test.ts.snap b/test/cli/install/__snapshots__/bun-workspaces.test.ts.snap
index ac3d396fea..cb0ab5362a 100644
--- a/test/cli/install/__snapshots__/bun-workspaces.test.ts.snap
+++ b/test/cli/install/__snapshots__/bun-workspaces.test.ts.snap
@@ -738,6 +738,252 @@ exports[`dependency on workspace without version in package.json: version: *-pre
 }"
 `;
 
+exports[`dependency on workspace without version in package.json: version: latest 1`] = `
+"{
+  "format": "v3",
+  "meta_hash": "0000000000000000000000000000000000000000000000000000000000000000",
+  "package_index": {
+    "no-deps": 2,
+    "foo": 0,
+    "bar": 1
+  },
+  "trees": [
+    {
+      "id": 0,
+      "path": "node_modules",
+      "depth": 0,
+      "dependencies": {
+        "bar": {
+          "id": 0,
+          "package_id": 1
+        },
+        "no-deps": {
+          "id": 1,
+          "package_id": 2
+        }
+      }
+    }
+  ],
+  "dependencies": [
+    {
+      "name": "bar",
+      "literal": "",
+      "workspace": "packages/bar",
+      "package_id": 1,
+      "behavior": {
+        "workspace": true
+      },
+      "id": 0
+    },
+    {
+      "name": "no-deps",
+      "literal": "",
+      "workspace": "packages/mono",
+      "package_id": 2,
+      "behavior": {
+        "workspace": true
+      },
+      "id": 1
+    },
+    {
+      "name": "no-deps",
+      "literal": "latest",
+      "workspace": "packages/mono",
+      "package_id": 2,
+      "behavior": {
+        "prod": true
+      },
+      "id": 2
+    }
+  ],
+  "packages": [
+    {
+      "id": 0,
+      "name": "foo",
+      "name_hash": "14841791273925386894",
+      "resolution": {
+        "tag": "root",
+        "value": "",
+        "resolved": ""
+      },
+      "dependencies": [
+        0,
+        1
+      ],
+      "integrity": null,
+      "man_dir": "",
+      "origin": "local",
+      "bin": null,
+      "scripts": {}
+    },
+    {
+      "id": 1,
+      "name": "bar",
+      "name_hash": "11592711315645265694",
+      "resolution": {
+        "tag": "workspace",
+        "value": "workspace:packages/bar",
+        "resolved": "workspace:packages/bar"
+      },
+      "dependencies": [
+        2
+      ],
+      "integrity": null,
+      "man_dir": "",
+      "origin": "npm",
+      "bin": null,
+      "scripts": {}
+    },
+    {
+      "id": 2,
+      "name": "no-deps",
+      "name_hash": "5128161233225832376",
+      "resolution": {
+        "tag": "workspace",
+        "value": "workspace:packages/mono",
+        "resolved": "workspace:packages/mono"
+      },
+      "dependencies": [],
+      "integrity": null,
+      "man_dir": "",
+      "origin": "npm",
+      "bin": null,
+      "scripts": {}
+    }
+  ],
+  "workspace_paths": {
+    "11592711315645265694": "packages/bar",
+    "5128161233225832376": "packages/mono"
+  },
+  "workspace_versions": {
+    "11592711315645265694": "1.0.0"
+  }
+}"
+`;
+
+exports[`dependency on workspace without version in package.json: version:  1`] = `
+"{
+  "format": "v3",
+  "meta_hash": "0000000000000000000000000000000000000000000000000000000000000000",
+  "package_index": {
+    "no-deps": 2,
+    "foo": 0,
+    "bar": 1
+  },
+  "trees": [
+    {
+      "id": 0,
+      "path": "node_modules",
+      "depth": 0,
+      "dependencies": {
+        "bar": {
+          "id": 0,
+          "package_id": 1
+        },
+        "no-deps": {
+          "id": 1,
+          "package_id": 2
+        }
+      }
+    }
+  ],
+  "dependencies": [
+    {
+      "name": "bar",
+      "literal": "",
+      "workspace": "packages/bar",
+      "package_id": 1,
+      "behavior": {
+        "workspace": true
+      },
+      "id": 0
+    },
+    {
+      "name": "no-deps",
+      "literal": "",
+      "workspace": "packages/mono",
+      "package_id": 2,
+      "behavior": {
+        "workspace": true
+      },
+      "id": 1
+    },
+    {
+      "name": "no-deps",
+      "literal": "",
+      "workspace": "packages/mono",
+      "package_id": 2,
+      "behavior": {
+        "prod": true
+      },
+      "id": 2
+    }
+  ],
+  "packages": [
+    {
+      "id": 0,
+      "name": "foo",
+      "name_hash": "14841791273925386894",
+      "resolution": {
+        "tag": "root",
+        "value": "",
+        "resolved": ""
+      },
+      "dependencies": [
+        0,
+        1
+      ],
+      "integrity": null,
+      "man_dir": "",
+      "origin": "local",
+      "bin": null,
+      "scripts": {}
+    },
+    {
+      "id": 1,
+      "name": "bar",
+      "name_hash": "11592711315645265694",
+      "resolution": {
+        "tag": "workspace",
+        "value": "workspace:packages/bar",
+        "resolved": "workspace:packages/bar"
+      },
+      "dependencies": [
+        2
+      ],
+      "integrity": null,
+      "man_dir": "",
+      "origin": "npm",
+      "bin": null,
+      "scripts": {}
+    },
+    {
+      "id": 2,
+      "name": "no-deps",
+      "name_hash": "5128161233225832376",
+      "resolution": {
+        "tag": "workspace",
+        "value": "workspace:packages/mono",
+        "resolved": "workspace:packages/mono"
+      },
+      "dependencies": [],
+      "integrity": null,
+      "man_dir": "",
+      "origin": "npm",
+      "bin": null,
+      "scripts": {}
+    }
+  ],
+  "workspace_paths": {
+    "11592711315645265694": "packages/bar",
+    "5128161233225832376": "packages/mono"
+  },
+  "workspace_versions": {
+    "11592711315645265694": "1.0.0"
+  }
+}"
+`;
+
 exports[`dependency on workspace without version in package.json: version: 1 1`] = `
 "{
   "format": "v3",
@@ -1674,327 +1920,12 @@ exports[`dependency on workspace without version in package.json: version: *+bui
 }"
 `;
 
-exports[`dependency on workspace without version in package.json: version: latest 1`] = `
-"{
-  "format": "v3",
-  "meta_hash": "0000000000000000000000000000000000000000000000000000000000000000",
-  "package_index": {
-    "no-deps": [
-      2,
-      3
-    ],
-    "foo": 0,
-    "bar": 1
-  },
-  "trees": [
-    {
-      "id": 0,
-      "path": "node_modules",
-      "depth": 0,
-      "dependencies": {
-        "bar": {
-          "id": 0,
-          "package_id": 1
-        },
-        "no-deps": {
-          "id": 1,
-          "package_id": 2
-        }
-      }
-    },
-    {
-      "id": 1,
-      "path": "node_modules/bar/node_modules",
-      "depth": 1,
-      "dependencies": {
-        "no-deps": {
-          "id": 2,
-          "package_id": 3
-        }
-      }
-    }
-  ],
-  "dependencies": [
-    {
-      "name": "bar",
-      "literal": "",
-      "workspace": "packages/bar",
-      "package_id": 1,
-      "behavior": {
-        "workspace": true
-      },
-      "id": 0
-    },
-    {
-      "name": "no-deps",
-      "literal": "",
-      "workspace": "packages/mono",
-      "package_id": 2,
-      "behavior": {
-        "workspace": true
-      },
-      "id": 1
-    },
-    {
-      "name": "no-deps",
-      "literal": "latest",
-      "dist_tag": {
-        "name": "no-deps",
-        "tag": "no-deps"
-      },
-      "package_id": 3,
-      "behavior": {
-        "prod": true
-      },
-      "id": 2
-    }
-  ],
-  "packages": [
-    {
-      "id": 0,
-      "name": "foo",
-      "name_hash": "14841791273925386894",
-      "resolution": {
-        "tag": "root",
-        "value": "",
-        "resolved": ""
-      },
-      "dependencies": [
-        0,
-        1
-      ],
-      "integrity": null,
-      "man_dir": "",
-      "origin": "local",
-      "bin": null,
-      "scripts": {}
-    },
-    {
-      "id": 1,
-      "name": "bar",
-      "name_hash": "11592711315645265694",
-      "resolution": {
-        "tag": "workspace",
-        "value": "workspace:packages/bar",
-        "resolved": "workspace:packages/bar"
-      },
-      "dependencies": [
-        2
-      ],
-      "integrity": null,
-      "man_dir": "",
-      "origin": "npm",
-      "bin": null,
-      "scripts": {}
-    },
-    {
-      "id": 2,
-      "name": "no-deps",
-      "name_hash": "5128161233225832376",
-      "resolution": {
-        "tag": "workspace",
-        "value": "workspace:packages/mono",
-        "resolved": "workspace:packages/mono"
-      },
-      "dependencies": [],
-      "integrity": null,
-      "man_dir": "",
-      "origin": "npm",
-      "bin": null,
-      "scripts": {}
-    },
-    {
-      "id": 3,
-      "name": "no-deps",
-      "name_hash": "5128161233225832376",
-      "resolution": {
-        "tag": "npm",
-        "value": "2.0.0",
-        "resolved": "http://localhost:1234/no-deps/-/no-deps-2.0.0.tgz"
-      },
-      "dependencies": [],
-      "integrity": "sha512-W3duJKZPcMIG5rA1io5cSK/bhW9rWFz+jFxZsKS/3suK4qHDkQNxUTEXee9/hTaAoDCeHWQqogukWYKzfr6X4g==",
-      "man_dir": "",
-      "origin": "npm",
-      "bin": null,
-      "scripts": {}
-    }
-  ],
-  "workspace_paths": {
-    "11592711315645265694": "packages/bar",
-    "5128161233225832376": "packages/mono"
-  },
-  "workspace_versions": {
-    "11592711315645265694": "1.0.0"
-  }
-}"
-`;
-
-exports[`dependency on workspace without version in package.json: version:  1`] = `
-"{
-  "format": "v3",
-  "meta_hash": "0000000000000000000000000000000000000000000000000000000000000000",
-  "package_index": {
-    "no-deps": [
-      2,
-      3
-    ],
-    "foo": 0,
-    "bar": 1
-  },
-  "trees": [
-    {
-      "id": 0,
-      "path": "node_modules",
-      "depth": 0,
-      "dependencies": {
-        "bar": {
-          "id": 0,
-          "package_id": 1
-        },
-        "no-deps": {
-          "id": 1,
-          "package_id": 2
-        }
-      }
-    },
-    {
-      "id": 1,
-      "path": "node_modules/bar/node_modules",
-      "depth": 1,
-      "dependencies": {
-        "no-deps": {
-          "id": 2,
-          "package_id": 3
-        }
-      }
-    }
-  ],
-  "dependencies": [
-    {
-      "name": "bar",
-      "literal": "",
-      "workspace": "packages/bar",
-      "package_id": 1,
-      "behavior": {
-        "workspace": true
-      },
-      "id": 0
-    },
-    {
-      "name": "no-deps",
-      "literal": "",
-      "workspace": "packages/mono",
-      "package_id": 2,
-      "behavior": {
-        "workspace": true
-      },
-      "id": 1
-    },
-    {
-      "name": "no-deps",
-      "literal": "",
-      "dist_tag": {
-        "name": "no-deps",
-        "tag": "no-deps"
-      },
-      "package_id": 3,
-      "behavior": {
-        "prod": true
-      },
-      "id": 2
-    }
-  ],
-  "packages": [
-    {
-      "id": 0,
-      "name": "foo",
-      "name_hash": "14841791273925386894",
-      "resolution": {
-        "tag": "root",
-        "value": "",
-        "resolved": ""
-      },
-      "dependencies": [
-        0,
-        1
-      ],
-      "integrity": null,
-      "man_dir": "",
-      "origin": "local",
-      "bin": null,
-      "scripts": {}
-    },
-    {
-      "id": 1,
-      "name": "bar",
-      "name_hash": "11592711315645265694",
-      "resolution": {
-        "tag": "workspace",
-        "value": "workspace:packages/bar",
-        "resolved": "workspace:packages/bar"
-      },
-      "dependencies": [
-        2
-      ],
-      "integrity": null,
-      "man_dir": "",
-      "origin": "npm",
-      "bin": null,
-      "scripts": {}
-    },
-    {
-      "id": 2,
-      "name": "no-deps",
-      "name_hash": "5128161233225832376",
-      "resolution": {
-        "tag": "workspace",
-        "value": "workspace:packages/mono",
-        "resolved": "workspace:packages/mono"
-      },
-      "dependencies": [],
-      "integrity": null,
-      "man_dir": "",
-      "origin": "npm",
-      "bin": null,
-      "scripts": {}
-    },
-    {
-      "id": 3,
-      "name": "no-deps",
-      "name_hash": "5128161233225832376",
-      "resolution": {
-        "tag": "npm",
-        "value": "2.0.0",
-        "resolved": "http://localhost:1234/no-deps/-/no-deps-2.0.0.tgz"
-      },
-      "dependencies": [],
-      "integrity": "sha512-W3duJKZPcMIG5rA1io5cSK/bhW9rWFz+jFxZsKS/3suK4qHDkQNxUTEXee9/hTaAoDCeHWQqogukWYKzfr6X4g==",
-      "man_dir": "",
-      "origin": "npm",
-      "bin": null,
-      "scripts": {}
-    }
-  ],
-  "workspace_paths": {
-    "11592711315645265694": "packages/bar",
-    "5128161233225832376": "packages/mono"
-  },
-  "workspace_versions": {
-    "11592711315645265694": "1.0.0"
-  }
-}"
-`;
-
 exports[`dependency on same name as workspace and dist-tag: with version 1`] = `
 "{
   "format": "v3",
   "meta_hash": "0000000000000000000000000000000000000000000000000000000000000000",
   "package_index": {
-    "no-deps": [
-      2,
-      3
-    ],
+    "no-deps": 2,
     "foo": 0,
     "bar": 1
   },
@@ -2013,17 +1944,6 @@ exports[`dependency on same name as workspace and dist-tag: with version 1`] = `
           "package_id": 2
         }
       }
-    },
-    {
-      "id": 1,
-      "path": "node_modules/bar/node_modules",
-      "depth": 1,
-      "dependencies": {
-        "no-deps": {
-          "id": 2,
-          "package_id": 3
-        }
-      }
     }
   ],
   "dependencies": [
@@ -2050,11 +1970,8 @@ exports[`dependency on same name as workspace and dist-tag: with version 1`] = `
     {
       "name": "no-deps",
       "literal": "latest",
-      "dist_tag": {
-        "name": "no-deps",
-        "tag": "no-deps"
-      },
-      "package_id": 3,
+      "workspace": "packages/mono",
+      "package_id": 2,
       "behavior": {
         "prod": true
       },
@@ -2114,22 +2031,6 @@ exports[`dependency on same name as workspace and dist-tag: with version 1`] = `
       "origin": "npm",
       "bin": null,
       "scripts": {}
-    },
-    {
-      "id": 3,
-      "name": "no-deps",
-      "name_hash": "5128161233225832376",
-      "resolution": {
-        "tag": "npm",
-        "value": "2.0.0",
-        "resolved": "http://localhost:1234/no-deps/-/no-deps-2.0.0.tgz"
-      },
-      "dependencies": [],
-      "integrity": "sha512-W3duJKZPcMIG5rA1io5cSK/bhW9rWFz+jFxZsKS/3suK4qHDkQNxUTEXee9/hTaAoDCeHWQqogukWYKzfr6X4g==",
-      "man_dir": "",
-      "origin": "npm",
-      "bin": null,
-      "scripts": {}
     }
   ],
   "workspace_paths": {
diff --git a/test/cli/install/bun-workspaces.test.ts b/test/cli/install/bun-workspaces.test.ts
index b1a0a59ec3..4de1fac14c 100644
--- a/test/cli/install/bun-workspaces.test.ts
+++ b/test/cli/install/bun-workspaces.test.ts
@@ -66,17 +66,10 @@ test("dependency on workspace without version in package.json", async () => {
     "kjwoehcojrgjoj", // dist-tag does not exist, should choose local workspace
     "*.1.*",
     "*-pre",
+    "latest", // dist-tag exists, should choose local workspace
+    "", // empty string is treated as "latest" dist tag, should choose local workspace
   ];
-  const shouldNotWork: string[] = [
-    "1",
-    "1.*",
-    "1.1.*",
-    "1.1.0",
-    "*-pre+build",
-    "*+build",
-    "latest", // dist-tag exists, should choose package from npm
-    "",
-  ];
+  const shouldNotWork: string[] = ["1", "1.*", "1.1.*", "1.1.0", "*-pre+build", "*+build"];
 
   for (const version of shouldWork) {
     writeFileSync(
@@ -213,7 +206,7 @@ test("dependency on same name as workspace and dist-tag", async () => {
   expect(out.replace(/\s*\[[0-9\.]+m?s\]\s*$/, "").split(/\r?\n/)).toEqual([
     expect.stringContaining("bun install v1."),
     "",
-    "3 packages installed",
+    "2 packages installed",
   ]);
 });