diff --git a/packages/language-server/src/plugins/typescript/module-loader.ts b/packages/language-server/src/plugins/typescript/module-loader.ts
index 1a4133a9a..7a31fbf33 100644
--- a/packages/language-server/src/plugins/typescript/module-loader.ts
+++ b/packages/language-server/src/plugins/typescript/module-loader.ts
@@ -73,10 +73,16 @@ class ImpliedNodeFormatResolver {
     private alreadyResolved = new Map<string, ReturnType<typeof ts.getModeForResolutionAtIndex>>();
 
     resolve(
+        importPath: string,
         importIdxInFile: number,
         sourceFile: ts.SourceFile | undefined,
         compilerOptions: ts.CompilerOptions
     ) {
+        if (isSvelteFilePath(importPath)) {
+            // Svelte imports should use the old resolution algorithm, else they are not found
+            return undefined;
+        }
+
         let mode = undefined;
         if (sourceFile) {
             if (!sourceFile.impliedNodeFormat && isSvelteFilePath(sourceFile.fileName)) {
@@ -167,6 +173,7 @@ export function createSvelteModuleLoader(
         index: number
     ): ts.ResolvedModule | undefined {
         const mode = impliedNodeFormatResolver.resolve(
+            name,
             index,
             containingSourceFile,
             compilerOptions
diff --git a/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/expected.json b/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/expected.json
index f17503b0b..055b33e7f 100644
--- a/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/expected.json
+++ b/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/expected.json
@@ -1,6 +1,6 @@
 [
     {
-        "range": { "start": { "line": 4, "character": 22 }, "end": { "line": 4, "character": 29 } },
+        "range": { "start": { "line": 5, "character": 22 }, "end": { "line": 5, "character": 29 } },
         "severity": 1,
         "source": "ts",
         "message": "Relative import paths need explicit file extensions in EcmaScript imports when '--moduleResolution' is 'node16' or 'nodenext'. Did you mean './bar.js'?",
diff --git a/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/expectedv2.json b/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/expectedv2.json
index f17503b0b..055b33e7f 100644
--- a/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/expectedv2.json
+++ b/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/expectedv2.json
@@ -1,6 +1,6 @@
 [
     {
-        "range": { "start": { "line": 4, "character": 22 }, "end": { "line": 4, "character": 29 } },
+        "range": { "start": { "line": 5, "character": 22 }, "end": { "line": 5, "character": 29 } },
         "severity": 1,
         "source": "ts",
         "message": "Relative import paths need explicit file extensions in EcmaScript imports when '--moduleResolution' is 'node16' or 'nodenext'. Did you mean './bar.js'?",
diff --git a/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/input.svelte b/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/input.svelte
index 2b2a30987..51ce74b94 100644
--- a/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/input.svelte
+++ b/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/input.svelte
@@ -1,8 +1,9 @@
 <script lang="ts">
   // valid
   import { foo } from './bar.js';
+  import Other from './other.svelte';
   // invalid
   import { baz } from './bar';
 
-  foo;baz;
+  foo;baz;Other;
 </script>
diff --git a/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/other.svelte b/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/other.svelte
new file mode 100644
index 000000000..2b2a30987
--- /dev/null
+++ b/packages/language-server/test/plugins/typescript/features/diagnostics/fixtures/node16/other.svelte
@@ -0,0 +1,8 @@
+<script lang="ts">
+  // valid
+  import { foo } from './bar.js';
+  // invalid
+  import { baz } from './bar';
+
+  foo;baz;
+</script>
diff --git a/packages/typescript-plugin/src/module-loader.ts b/packages/typescript-plugin/src/module-loader.ts
index 0ccc69e02..0fffcff9c 100644
--- a/packages/typescript-plugin/src/module-loader.ts
+++ b/packages/typescript-plugin/src/module-loader.ts
@@ -121,26 +121,27 @@ export function patchModuleLoader(
                 return cachedModule;
             }
 
-            const resolvedModule = resolveModuleName(fileName, containingFile, compilerOptions);
+            const resolvedModule = resolveSvelteModuleName(
+                fileName,
+                containingFile,
+                compilerOptions
+            );
             moduleCache.set(fileName, containingFile, resolvedModule);
             return resolvedModule;
         });
     }
 
-    function resolveModuleName(
+    function resolveSvelteModuleName(
         name: string,
         containingFile: string,
         compilerOptions: ts.CompilerOptions
     ): ts.ResolvedModule | undefined {
-        // If we were to do this correctly, we'd need to check the module resolution mode for
-        // Node16/NodeNext in order to determine whether or not someone needs to have .js file
-        // endings in relative import paths. But because we don't do diagnostics within Svelte
-        // files in this TS plugin, we can ignore this and deal with some false positive resolutions
         const svelteResolvedModule = typescript.resolveModuleName(
             name,
             containingFile,
             compilerOptions,
             svelteSys
+            // don't set mode or else .svelte imports couldn't be resolved
         ).resolvedModule;
         if (
             !svelteResolvedModule ||