diff --git a/packages/ansible-language-server/src/server.ts b/packages/ansible-language-server/src/server.ts
index ee7941fa0..414344755 100644
--- a/packages/ansible-language-server/src/server.ts
+++ b/packages/ansible-language-server/src/server.ts
@@ -6,7 +6,7 @@ import {
   NotificationHandler,
   ProposedFeatures,
   TextDocuments,
-} from "vscode-languageserver/node";
+} from "vscode-languageserver/node.js";
 import { AnsibleLanguageService } from "@src/ansibleLanguageService";
 import { getUnsupportedError } from "@src/utils/misc";
 
diff --git a/packages/ansible-language-server/tsup.config.ts b/packages/ansible-language-server/tsup.config.ts
index ebaa5bd78..1973b5d32 100644
--- a/packages/ansible-language-server/tsup.config.ts
+++ b/packages/ansible-language-server/tsup.config.ts
@@ -23,7 +23,7 @@ export const tsup: Options = {
     // "src/services/settingsManager.ts",
   ],
   minify: env === "production",
-  bundle: env === "production",
+  bundle: true,
   entry: ["src/**/*.ts"],
   format: ["esm", "cjs"],
   outDir: env === "production" ? "dist" : "lib",
diff --git a/src/extension.ts b/src/extension.ts
index ad272cb52..aab180334 100644
--- a/src/extension.ts
+++ b/src/extension.ts
@@ -1,4 +1,5 @@
 /* "stdlib" */
+import * as fs from "node:fs";
 import * as path from "node:path";
 import * as vscode from "vscode";
 import { ExtensionContext, extensions, window, workspace } from "vscode";
@@ -1156,14 +1157,25 @@ const startClient = async (
     "dist",
     "cli.cjs",
   );
-  const packageServer = path.join(
+
+  // For debug mode: prefer workspace server (development) over node_modules (published package)
+  const workspaceServer = path.join(
     context.extensionPath,
-    "node_modules",
-    "@ansible",
+    "packages",
     "ansible-language-server",
     "dist",
-    "cli.js",
+    "cli.cjs",
   );
+  const packageServer = fs.existsSync(workspaceServer)
+    ? workspaceServer
+    : path.join(
+        context.extensionPath,
+        "node_modules",
+        "@ansible",
+        "ansible-language-server",
+        "dist",
+        "cli.js",
+      );
 
   // server is run at port 6009 for debugging
   const debugOptions = { execArgv: ["--nolazy", "--inspect=6010"] };