diff --git a/src/SmallSharp/EmitTargets.cs b/src/SmallSharp/EmitTargets.cs
index c3b68e1..09e893d 100644
--- a/src/SmallSharp/EmitTargets.cs
+++ b/src/SmallSharp/EmitTargets.cs
@@ -14,7 +14,7 @@ namespace SmallSharp;
 public class EmitTargets : Task
 {
     static readonly Regex sdkExpr = new(@"^#:sdk\s+(?<sdk>[^@]+?)(@(?<version>.+))?$");
-    static readonly Regex packageExpr = new(@"^#:package\s+(?<id>[^@]+)@(?<version>.+)$");
+    static readonly Regex packageExpr = new(@"^#:package\s+(?<id>[^@\s]+)(@(?<version>.+))?$");
     static readonly Regex propertyExpr = new(@"^#:property\s+(?<name>[^=]+)=(?<value>.+)$");
 
     [Required]
@@ -32,6 +32,8 @@ public class EmitTargets : Task
     [Required]
     public required bool UsingSDK { get; set; }
 
+    public bool ManagePackageVersionsCentrally { get; set; }
+
     public ITaskItem[] PackageReferences { get; set; } = [];
 
     [Output]
@@ -62,18 +64,44 @@ public override bool Execute()
         var properties = new List<XElement>();
         var sdks = new List<XAttribute[]>();
 
-        foreach (var line in contents)
+        for (var i = 0; i < contents.Length; i++)
         {
+            var line = contents[i];
             if (packageExpr.Match(line) is { Success: true } match)
             {
                 var id = match.Groups["id"].Value.Trim();
                 var version = match.Groups["version"].Value.Trim();
+                var hasVersion = !string.IsNullOrEmpty(version);
 
-                packages.Add(NewTaskItem(id, [("Version", version)]));
+                if (ManagePackageVersionsCentrally && hasVersion && !UsingSDK)
+                {
+                    Log.LogWarning(
+                        null,
+                        "SCS05",
+                        null,
+                        filePath,
+                        i + 1,
+                        0,
+                        0,
+                        0,
+                        "Package reference '{0}' declares version '{1}' via #:package while ManagePackageVersionsCentrally=true; SmallSharp will omit Version metadata and use the central package version.",
+                        id,
+                        version);
+                }
 
-                items.Add(new XElement("PackageReference",
-                    new XAttribute("Include", id),
-                    new XAttribute("Version", version)));
+                if (!ManagePackageVersionsCentrally && hasVersion)
+                {
+                    packages.Add(NewTaskItem(id, [("Version", version)]));
+                    items.Add(new XElement("PackageReference",
+                        new XAttribute("Include", id),
+                        new XAttribute("Version", version)));
+                }
+                else
+                {
+                    packages.Add(new TaskItem(id));
+                    items.Add(new XElement("PackageReference",
+                        new XAttribute("Include", id)));
+                }
             }
             else if (sdkExpr.Match(line) is { Success: true } sdkMatch)
             {
@@ -130,7 +158,7 @@ public override bool Execute()
             new XElement("PropertyGroup",
                 [new XElement("SmallSharpProjectExtensionPropsImported", "true")])));
 
-        // Determine if a restore is needed: if any discovered #:package (id+version) is not already
+        // Determine if a restore is needed: if any discovered #:package is not already
         // present in the incoming PackageReferences list.
         foreach (var pkg in packages)
         {
@@ -138,7 +166,8 @@ public override bool Execute()
             var version = pkg.GetMetadata("Version");
             var exists = PackageReferences?.Any(r =>
                 string.Equals(r.ItemSpec, id, StringComparison.OrdinalIgnoreCase) &&
-                string.Equals(r.GetMetadata("Version"), version, StringComparison.OrdinalIgnoreCase)) == true;
+                (string.IsNullOrEmpty(version) ||
+                 string.Equals(r.GetMetadata("Version"), version, StringComparison.OrdinalIgnoreCase))) == true;
 
             if (!exists)
             {
diff --git a/src/SmallSharp/Sdk.targets b/src/SmallSharp/Sdk.targets
index a40c2f7..9ffff10 100644
--- a/src/SmallSharp/Sdk.targets
+++ b/src/SmallSharp/Sdk.targets
@@ -26,11 +26,30 @@
     <ItemGroup Condition="'@(_PkgLines)' != ''">
       <_PkgReference Include="$([MSBuild]::ValueOrDefault('%(_PkgLines.Identity)', '').Substring(10))" />
 
-      <PackageReference Condition="'@(_PkgReference)' != ''" Include="$([MSBuild]::ValueOrDefault('%(_PkgReference.Identity)', '').Split('@')[0])">
-        <Version>$([MSBuild]::ValueOrDefault('%(_PkgReference.Identity)', '').Split('@')[1])</Version>
+      <_PkgReferenceWithVersion Include="@(_PkgReference)"
+                                Condition="$([System.Text.RegularExpressions.Regex]::IsMatch('%(_PkgReference.Identity)', '@'))">
+        <PackageId>$([System.Text.RegularExpressions.Regex]::Replace('%(_PkgReference.Identity)', '@.*$', ''))</PackageId>
+        <PackageVersion>$([System.Text.RegularExpressions.Regex]::Replace('%(_PkgReference.Identity)', '^[^@]+@', ''))</PackageVersion>
+      </_PkgReferenceWithVersion>
+
+      <_PkgReferenceWithoutVersion Include="@(_PkgReference)"
+                                   Condition="!$([System.Text.RegularExpressions.Regex]::IsMatch('%(_PkgReference.Identity)', '@'))" />
+
+      <PackageReference Include="@(_PkgReferenceWithoutVersion)" />
+
+      <PackageReference Include="%(_PkgReferenceWithVersion.PackageId)"
+                        Condition="'$(ManagePackageVersionsCentrally)' == 'true'" />
+
+      <PackageReference Include="%(_PkgReferenceWithVersion.PackageId)"
+                        Condition="'$(ManagePackageVersionsCentrally)' != 'true'">
+        <Version>%(_PkgReferenceWithVersion.PackageVersion)</Version>
       </PackageReference>
     </ItemGroup>
 
+    <Warning Code="SCS05"
+             Condition="'$(ManagePackageVersionsCentrally)' == 'true' and '@(_PkgReferenceWithVersion)' != ''"
+             Text="Package references declared with #:package and @ versions are not compatible with ManagePackageVersionsCentrally=true; SmallSharp will omit Version metadata and use central package versions for: @(_PkgReferenceWithVersion -> '%(Identity)', ', ')." />
+
   </Target>
 
 </Project>
\ No newline at end of file
diff --git a/src/SmallSharp/SmallSharp.targets b/src/SmallSharp/SmallSharp.targets
index 63c2a9c..dc3f12a 100644
--- a/src/SmallSharp/SmallSharp.targets
+++ b/src/SmallSharp/SmallSharp.targets
@@ -51,8 +51,6 @@
   <Target Name="EnsureProperties" Condition="'$(CheckSmallSharpRequirements)' != 'false'">
     <Error Code="SCS02" Condition="'$(_ImportProjectExtensionProps)' != 'true' or '$(_ImportProjectExtensionTargets)' != 'true'"
            Text="Setting ImportProjectExtensionProps and ImportProjectExtensionTargets project properties to 'true' is required by SmallSharp to support C# package and project directives." />
-    <Error Code="SCS03" Condition="'$(ManagePackageVersionsCentrally)' == 'true'" 
-           Text="Setting ManagePackageVersionsCentrally to 'true' is not supported by SmallSharp since C# program files can declare package references via #:package directives." />
     <Warning Code="SCS04" Condition="'$(UsingSmallSharpSDK)' != 'true'"
              Text='For maximum compatibility with file-based apps, use SmallSharp as an SDK instead of a package reference: &lt;Project Sdk="SmallSharp/$(SmallSharpVersion)"&gt;' />
   </Target>
@@ -195,11 +193,12 @@
           Inputs="@(Compile);$(ActiveDebugProfile);$(ActiveFile);Properties\launchSettings.json" 
           Outputs="$(SmallSharpPackagesProps);$(SmallSharpPackagesTargets)">
     <EmitTargets StartupFile="$(StartupFile)" 
-                 UsingSDK="$(UsingSmallSharpSDK)"
-                 PackageReferences="@(PackageReferences)"
-                 PropsFile="$(SmallSharpPackagesProps)"
-                 TargetsFile="$(SmallSharpPackagesTargets)"
-                 BaseIntermediateOutputPath="$(BaseIntermediateOutputPath)">
+                  UsingSDK="$(UsingSmallSharpSDK)"
+                  ManagePackageVersionsCentrally="$([MSBuild]::ValueOrDefault('$(ManagePackageVersionsCentrally)', 'false'))"
+                  PackageReferences="@(PackageReferences)"
+                  PropsFile="$(SmallSharpPackagesProps)"
+                  TargetsFile="$(SmallSharpPackagesTargets)"
+                  BaseIntermediateOutputPath="$(BaseIntermediateOutputPath)">
       <Output TaskParameter="Packages" ItemName="FileBasedPackage" />
       <Output TaskParameter="Properties" PropertyName="FileBasedProperty" />
       <Output TaskParameter="Sdks" PropertyName="FileBasedSdk" />