diff --git a/src/bundle-server.ts b/src/bundle-server.ts
index d523693e..9a42d539 100644
--- a/src/bundle-server.ts
+++ b/src/bundle-server.ts
@@ -48,7 +48,7 @@ export function registerServerBundle(
             return `  '${collection}': createRemoteCollection(${JSON.stringify(getRemoteEndpoint(collection))}),`
           }
 
-          const path = getCollectionPath(collection)
+          const path = getCollectionPath(collection, nuxt)
 
           // When in dev mode, we avoid bundling the icons to improve performance
           // Get rid of the require() when ESM JSON modules are widely supported
diff --git a/src/collections.ts b/src/collections.ts
index 2521f202..5fd95076 100644
--- a/src/collections.ts
+++ b/src/collections.ts
@@ -9,7 +9,15 @@ import { isPackageExists } from 'local-pkg'
 import { collectionNames } from './collection-names'
 import type { CustomCollection, ServerBundleOptions, RemoteCollection } from './types'
 
-export const isFullCollectionExists = isPackageExists('@iconify/json')
+function getResolvePaths(nuxt: Nuxt): string[] {
+  return Array.from(new Set(
+    [nuxt.options.rootDir, nuxt.options.workspaceDir].filter(Boolean),
+  ))
+}
+
+export function hasFullCollection(nuxt: Nuxt): boolean {
+  return isPackageExists('@iconify/json', { paths: getResolvePaths(nuxt) })
+}
 
 export async function resolveCollection(
   nuxt: Nuxt,
@@ -24,8 +32,8 @@ export async function resolveCollection(
   return collection
 }
 
-export function getCollectionPath(collection: string) {
-  return isFullCollectionExists
+export function getCollectionPath(collection: string, nuxt: Nuxt) {
+  return hasFullCollection(nuxt)
     ? `@iconify/json/json/${collection}.json`
     : `@iconify-json/${collection}/icons.json`
 }
@@ -117,16 +125,18 @@ async function parseCustomCollection(
   return result
 }
 
-export async function discoverInstalledCollections(): Promise<ServerBundleOptions['collections']> {
-  const collections = isFullCollectionExists
+export async function discoverInstalledCollections(nuxt: Nuxt): Promise<ServerBundleOptions['collections']> {
+  const paths = getResolvePaths(nuxt)
+  const fullCollectionInstalled = hasFullCollection(nuxt)
+  const collections = fullCollectionInstalled
     ? collectionNames
-    : collectionNames.filter(collection => isPackageExists('@iconify-json/' + collection))
-  if (isFullCollectionExists)
+    : collectionNames.filter(collection => isPackageExists('@iconify-json/' + collection, { paths }))
+  if (fullCollectionInstalled)
     logger.success(`Nuxt Icon discovered local-installed ${collections.length} collections (@iconify/json)`)
   else if (collections.length)
     logger.success(`Nuxt Icon discovered local-installed ${collections.length} collections:`, collections.join(', '))
 
-  if (isFullCollectionExists)
+  if (fullCollectionInstalled)
     logger.warn('Currently all iconify collections are included in the bundle, which might be inefficient, consider explicit name the collections you use in the `icon.serverBundle.collections` option')
 
   return collections
diff --git a/src/context.ts b/src/context.ts
index 83034517..168d5ad0 100644
--- a/src/context.ts
+++ b/src/context.ts
@@ -100,7 +100,7 @@ export class NuxtIconModuleContext {
     if (!resolved.collections)
       resolved.collections = resolved.remote
         ? collectionNames
-        : await discoverInstalledCollections()
+        : await discoverInstalledCollections(this.nuxt)
 
     const collections = await Promise.all(
       (resolved.collections || [])
diff --git a/src/module.ts b/src/module.ts
index 06aa5c2e..2369aace 100644
--- a/src/module.ts
+++ b/src/module.ts
@@ -121,7 +121,7 @@ export default defineNuxtModule<ModuleOptions>({
 
       const collections = bundle.collections
         .filter(collection => typeof collection === 'string')
-        .map(collection => getCollectionPath(collection))
+        .map(collection => getCollectionPath(collection, nuxt))
       const resolvedPaths = await Promise.all(
         collections.map(collection => resolvePath(collection, {
           url: nuxt.options.rootDir,