diff --git a/e2e/tests/auto-imports.test.ts b/e2e/tests/auto-imports.test.ts
index f2b42b47..62929fa8 100644
--- a/e2e/tests/auto-imports.test.ts
+++ b/e2e/tests/auto-imports.test.ts
@@ -17,6 +17,8 @@ describe('Auto Imports', () => {
           export {}
           declare global {
             const ContentScriptContext: typeof import('wxt/client')['ContentScriptContext']
+            const InvalidMatchPattern: typeof import('wxt/sandbox')['InvalidMatchPattern']
+            const MatchPattern: typeof import('wxt/sandbox')['MatchPattern']
             const browser: typeof import('wxt/browser')['browser']
             const builtinDrivers: typeof import('wxt/storage')['builtinDrivers']
             const createContentScriptIframe: typeof import('wxt/client')['createContentScriptIframe']
diff --git a/package.json b/package.json
index f10ea238..953feea5 100644
--- a/package.json
+++ b/package.json
@@ -86,7 +86,9 @@
     "lint": "run-p -c -s lint:*",
     "lint:eslint": "echo 'ESLint: TODO'",
     "lint:package": "publint",
-    "compile": "tsc --noEmit",
+    "compile": "run-s -c compile:*",
+    "compile:wxt": "tsc --noEmit",
+    "compile:virtual": "tsc --noEmit -p src/virtual",
     "test": "vitest",
     "test:coverage": "vitest run --coverage",
     "prepare": "simple-git-hooks",
diff --git a/scripts/build.ts b/scripts/build.ts
index df70e7d9..105d395d 100644
--- a/scripts/build.ts
+++ b/scripts/build.ts
@@ -16,18 +16,17 @@ const startTime = Date.now();
 const outDir = 'dist';
 await fs.rm(path.join(outDir, '*'), { recursive: true, force: true });
 
-const preset: tsup.Options = {
+const preset = {
   dts: true,
   silent: true,
   sourcemap: false,
   external: [
-    'vite',
     'virtual:user-unlisted-script',
     'virtual:user-content-script-isolated-world',
     'virtual:user-content-script-main-world',
     'virtual:user-background',
   ],
-};
+} satisfies tsup.Options;
 
 function spinnerPMap(configs: tsup.Options[]) {
   let completed = 0;
@@ -89,6 +88,7 @@ const config: tsup.Options[] = [
     format: ['esm'],
     splitting: false,
     dts: false,
+    external: [...preset.external, 'wxt'],
   },
   // CJS-only
   {
diff --git a/src/browser.ts b/src/browser.ts
index 61ee5fab..103b19d6 100644
--- a/src/browser.ts
+++ b/src/browser.ts
@@ -17,3 +17,65 @@ export interface WxtI18n extends I18n.Static {
 }
 
 export const browser: AugmentedBrowser = originalBrowser;
+
+// re-export all the types from webextension-polyfill
+// Because webextension-polyfill uses a weird namespace with "import export", there isn't a good way
+// to get these types without re-listing them.
+/** @ignore */
+export type {
+  ActivityLog,
+  Alarms,
+  Bookmarks,
+  Action,
+  BrowserAction,
+  BrowserSettings,
+  BrowsingData,
+  CaptivePortal,
+  Clipboard,
+  Commands,
+  ContentScripts,
+  ContextualIdentities,
+  Cookies,
+  DeclarativeNetRequest,
+  Devtools,
+  Dns,
+  Downloads,
+  Events,
+  Experiments,
+  Extension,
+  ExtensionTypes,
+  Find,
+  GeckoProfiler,
+  History,
+  I18n,
+  Identity,
+  Idle,
+  Management,
+  Manifest,
+  ContextMenus,
+  Menus,
+  NetworkStatus,
+  NormandyAddonStudy,
+  Notifications,
+  Omnibox,
+  PageAction,
+  Permissions,
+  Pkcs11,
+  Privacy,
+  Proxy,
+  Runtime,
+  Scripting,
+  Search,
+  Sessions,
+  SidebarAction,
+  Storage,
+  Tabs,
+  Theme,
+  TopSites,
+  Types,
+  Urlbar,
+  UserScripts,
+  WebNavigation,
+  WebRequest,
+  Windows,
+} from 'webextension-polyfill';
diff --git a/src/client/content-scripts/content-script-context.ts b/src/client/content-scripts/content-script-context.ts
index 48d925f5..9233113e 100644
--- a/src/client/content-scripts/content-script-context.ts
+++ b/src/client/content-scripts/content-script-context.ts
@@ -1,6 +1,6 @@
 import { ContentScriptDefinition } from '~/types';
 import { browser } from '~/browser';
-import { logger } from '~/client/utils/logger';
+import { logger } from '~/sandbox/utils/logger';
 import { WxtLocationChangeEvent, getUniqueEventName } from './custom-events';
 import { createLocationWatcher } from './location-watcher';
 
diff --git a/src/client/content-scripts/content-script-iframe.ts b/src/client/content-scripts/content-script-iframe.ts
index 8247e13a..2c1ac518 100644
--- a/src/client/content-scripts/content-script-iframe.ts
+++ b/src/client/content-scripts/content-script-iframe.ts
@@ -1,4 +1,4 @@
-import browser from 'webextension-polyfill';
+import { browser } from '~/browser';
 import {
   ContentScriptAnchoredOptions,
   ContentScriptPositioningOptions,
diff --git a/src/client/content-scripts/content-script-ui.ts b/src/client/content-scripts/content-script-ui.ts
index 281a3c87..c8f38e69 100644
--- a/src/client/content-scripts/content-script-ui.ts
+++ b/src/client/content-scripts/content-script-ui.ts
@@ -1,6 +1,6 @@
 import { createIsolatedElement } from '@webext-core/isolated-element';
 import { browser } from '~/browser';
-import { logger } from '~/client/utils/logger';
+import { logger } from '~/sandbox/utils/logger';
 import { ContentScriptContext } from './content-script-context';
 import {
   ContentScriptAnchoredOptions,
diff --git a/src/core/builders/vite/plugins/webextensionPolyfillInlineDeps.ts b/src/core/builders/vite/plugins/webextensionPolyfillInlineDeps.ts
index b7023170..cbb1b73f 100644
--- a/src/core/builders/vite/plugins/webextensionPolyfillInlineDeps.ts
+++ b/src/core/builders/vite/plugins/webextensionPolyfillInlineDeps.ts
@@ -9,7 +9,7 @@ export function webextensionPolyfillInlineDeps(): vite.PluginOption {
   return {
     name: 'wxt:testing-inline-deps',
     config() {
-      const wxtModules = ['wxt/browser', 'wxt/client'];
+      const wxtModules = ['wxt/browser'];
       return {
         test: {
           server: {
diff --git a/src/core/initialize.ts b/src/core/initialize.ts
index b0410b46..6dd77a47 100644
--- a/src/core/initialize.ts
+++ b/src/core/initialize.ts
@@ -150,14 +150,6 @@ async function cloneProject({
         consola.warn('Failed to move _gitignore to .gitignore:', err),
       );
 
-    // 3. Add .npmrc for pnpm
-    if (packageManager === 'pnpm') {
-      await fs.writeFile(
-        path.join(directory, '.npmrc'),
-        'shamefully-hoist=true\n',
-      );
-    }
-
     spinner.succeed();
   } catch (err) {
     spinner.fail();
diff --git a/src/core/utils/building/rebuild.ts b/src/core/utils/building/rebuild.ts
index a8d8cfb3..32ab04cb 100644
--- a/src/core/utils/building/rebuild.ts
+++ b/src/core/utils/building/rebuild.ts
@@ -1,4 +1,4 @@
-import type { Manifest } from 'webextension-polyfill';
+import type { Manifest } from '~/browser';
 import { BuildOutput, EntrypointGroup, InternalConfig } from '~/types';
 import { findEntrypoints } from './find-entrypoints';
 import { generateTypesDir } from './generate-wxt-dir';
diff --git a/src/core/utils/content-scripts.ts b/src/core/utils/content-scripts.ts
index 691feb93..a4f016ca 100644
--- a/src/core/utils/content-scripts.ts
+++ b/src/core/utils/content-scripts.ts
@@ -1,4 +1,4 @@
-import type { Manifest } from 'webextension-polyfill';
+import type { Manifest } from '~/browser';
 import { ContentScriptEntrypoint, InternalConfig } from '~/types';
 import { resolvePerBrowserOption } from './entrypoints';
 
diff --git a/src/core/utils/manifest.ts b/src/core/utils/manifest.ts
index a4485a77..f43b0890 100644
--- a/src/core/utils/manifest.ts
+++ b/src/core/utils/manifest.ts
@@ -1,4 +1,4 @@
-import type { Manifest } from 'webextension-polyfill';
+import type { Manifest } from '~/browser';
 import {
   Entrypoint,
   BackgroundEntrypoint,
diff --git a/src/core/utils/testing/fake-objects.ts b/src/core/utils/testing/fake-objects.ts
index 949d053a..f846bd8b 100644
--- a/src/core/utils/testing/fake-objects.ts
+++ b/src/core/utils/testing/fake-objects.ts
@@ -4,7 +4,7 @@
 import { resolve } from 'path';
 import { faker } from '@faker-js/faker';
 import merge from 'lodash.merge';
-import type { Manifest } from 'webextension-polyfill';
+import type { Manifest } from '~/browser';
 import {
   FsCache,
   InternalConfig,
diff --git a/src/sandbox/index.ts b/src/sandbox/index.ts
index 50725005..91b43851 100644
--- a/src/sandbox/index.ts
+++ b/src/sandbox/index.ts
@@ -6,3 +6,4 @@
 export * from './define-unlisted-script';
 export * from './define-background';
 export * from './define-content-script';
+export * from '@webext-core/match-patterns';
diff --git a/src/client/utils/logger.ts b/src/sandbox/utils/logger.ts
similarity index 93%
rename from src/client/utils/logger.ts
rename to src/sandbox/utils/logger.ts
index 66ffcbf6..d2172bd4 100644
--- a/src/client/utils/logger.ts
+++ b/src/sandbox/utils/logger.ts
@@ -1,3 +1,5 @@
+/// <reference types="vite/client" />
+
 function print(method: (...args: any[]) => void, ...args: any[]) {
   if (import.meta.env.MODE === 'production') return;
 
diff --git a/src/storage.ts b/src/storage.ts
index 61fe9461..42861467 100644
--- a/src/storage.ts
+++ b/src/storage.ts
@@ -8,7 +8,7 @@ import {
   defineDriver,
   Storage,
 } from 'unstorage';
-import browser, { Storage as BrowserStorage } from 'webextension-polyfill';
+import { browser, Storage as BrowserStorage } from '~/browser';
 
 export interface WebExtensionDriverOptions {
   storageArea: 'sync' | 'local' | 'managed' | 'session';
diff --git a/src/types/external.ts b/src/types/external.ts
index 48719ea4..e535ae7f 100644
--- a/src/types/external.ts
+++ b/src/types/external.ts
@@ -1,5 +1,5 @@
 import type * as vite from 'vite';
-import type { Manifest, Scripting } from 'webextension-polyfill';
+import type { Manifest, Scripting } from '~/browser';
 import { UnimportOptions } from 'unimport';
 import { LogLevel } from 'consola';
 import { ContentScriptContext } from '../client/content-scripts/content-script-context';
diff --git a/src/types/globals.d.ts b/src/types/globals.d.ts
new file mode 100644
index 00000000..cfa8f0d9
--- /dev/null
+++ b/src/types/globals.d.ts
@@ -0,0 +1,7 @@
+// Globals defined by the vite-plugins/devServerGlobals.ts and utils/globals.ts
+declare const __COMMAND__: 'build' | 'serve';
+declare const __DEV_SERVER_PROTOCOL__: string;
+declare const __DEV_SERVER_HOSTNAME__: string;
+declare const __DEV_SERVER_PORT__: string;
+declare const __MANIFEST_VERSION__: 2 | 3;
+declare const __ENTRYPOINT__: string;
diff --git a/src/types/internal.ts b/src/types/internal.ts
index c4e626d0..fc8a631c 100644
--- a/src/types/internal.ts
+++ b/src/types/internal.ts
@@ -11,7 +11,7 @@ import {
 } from './external';
 import { UnimportOptions } from 'unimport';
 import { ResolvedConfig } from 'c12';
-import type { Manifest } from 'webextension-polyfill';
+import type { Manifest } from '~/browser';
 import type { PluginVisualizerOptions } from 'rollup-plugin-visualizer';
 
 export interface InternalConfig {
diff --git a/src/virtual/README.md b/src/virtual/README.md
new file mode 100644
index 00000000..b06cebed
--- /dev/null
+++ b/src/virtual/README.md
@@ -0,0 +1,11 @@
+# WXT Virtual Entrypoints
+
+This folder contains scripts that are either loaded as entrypoints to JS files or included in HTML files, just like a project using WXT might load their own scripts.
+
+While they are bundled and shipped inside WXT, Vite considers them apart of your project's source code, not WXT's. This means they cannot import 3rd party modules directly, otherwise `pnpm i --shamefully-hoist=false` and Yarn PnP will fail.
+
+For this reason, the virtual entrypoints get their own TS project to isolate them from the rest of the project. They can only import from `wxt/*` or utils that don't have any imports from node_modules, like the logger.
+
+When bundling WXT for publishing to NPM, all the `wxt/*` imports are marked as external and resolved when building your application. Other imports are added inline.
+
+See https://github.com/wxt-dev/wxt/issues/286#issuecomment-1858888390 for more details.
diff --git a/src/virtual/background-entrypoint.ts b/src/virtual/background-entrypoint.ts
index fac4bfd4..f69897a0 100644
--- a/src/virtual/background-entrypoint.ts
+++ b/src/virtual/background-entrypoint.ts
@@ -1,9 +1,9 @@
 import definition from 'virtual:user-background';
-import { setupWebSocket } from '../client/utils/setup-web-socket';
-import { logger } from '../client/utils/logger';
-import browser from 'webextension-polyfill';
-import { keepServiceWorkerAlive } from '../client/utils/keep-service-worker-alive';
-import { reloadContentScript } from '../client/utils/reload-content-scripts';
+import { setupWebSocket } from './utils/setup-web-socket';
+import { logger } from '../sandbox/utils/logger';
+import { browser } from 'wxt/browser';
+import { keepServiceWorkerAlive } from './utils/keep-service-worker-alive';
+import { reloadContentScript } from './utils/reload-content-scripts';
 
 if (__COMMAND__ === 'serve') {
   try {
diff --git a/src/virtual/content-script-isolated-world-entrypoint.ts b/src/virtual/content-script-isolated-world-entrypoint.ts
index f881ec84..429238da 100644
--- a/src/virtual/content-script-isolated-world-entrypoint.ts
+++ b/src/virtual/content-script-isolated-world-entrypoint.ts
@@ -1,6 +1,6 @@
 import definition from 'virtual:user-content-script-isolated-world';
-import { logger } from '~/client/utils/logger';
-import { ContentScriptContext } from '~/client/content-scripts/content-script-context';
+import { logger } from '../sandbox/utils/logger';
+import { ContentScriptContext } from 'wxt/client';
 
 (async () => {
   try {
diff --git a/src/virtual/content-script-main-world-entrypoint.ts b/src/virtual/content-script-main-world-entrypoint.ts
index 5ab4d457..43fc689b 100644
--- a/src/virtual/content-script-main-world-entrypoint.ts
+++ b/src/virtual/content-script-main-world-entrypoint.ts
@@ -1,5 +1,5 @@
 import definition from 'virtual:user-content-script-main-world';
-import { logger } from '~/client/utils/logger';
+import { logger } from '../sandbox/utils/logger';
 
 (async () => {
   try {
diff --git a/src/virtual/mock-browser.ts b/src/virtual/mock-browser.ts
index f02c0db0..cf37d2f7 100644
--- a/src/virtual/mock-browser.ts
+++ b/src/virtual/mock-browser.ts
@@ -1,3 +1,3 @@
-import { fakeBrowser as mockBrowser } from '~/testing';
+import { fakeBrowser as mockBrowser } from 'wxt/testing';
 
 export default mockBrowser;
diff --git a/src/virtual/reload-html.ts b/src/virtual/reload-html.ts
index 0b48da7c..f2a57a17 100644
--- a/src/virtual/reload-html.ts
+++ b/src/virtual/reload-html.ts
@@ -1,7 +1,5 @@
-/// <reference types="vite/client" />
-
-import { logger } from '~/client/utils/logger';
-import { setupWebSocket } from '~/client/utils/setup-web-socket';
+import { logger } from '../sandbox/utils/logger';
+import { setupWebSocket } from './utils/setup-web-socket';
 
 if (__COMMAND__ === 'serve') {
   try {
diff --git a/src/virtual/tsconfig.json b/src/virtual/tsconfig.json
new file mode 100644
index 00000000..929d30b6
--- /dev/null
+++ b/src/virtual/tsconfig.json
@@ -0,0 +1,7 @@
+{
+  "extends": "../../tsconfig.base.json",
+  "compilerOptions": {
+    "types": ["vite/client", "../types/globals.d.ts"]
+  },
+  "include": ["./*"]
+}
diff --git a/src/virtual/unlisted-script-entrypoint.ts b/src/virtual/unlisted-script-entrypoint.ts
index ea17e2e0..f7c1bead 100644
--- a/src/virtual/unlisted-script-entrypoint.ts
+++ b/src/virtual/unlisted-script-entrypoint.ts
@@ -1,5 +1,5 @@
 import definition from 'virtual:user-unlisted-script';
-import { logger } from '~/client/utils/logger';
+import { logger } from '../sandbox/utils/logger';
 
 (async () => {
   try {
diff --git a/src/client/utils/keep-service-worker-alive.ts b/src/virtual/utils/keep-service-worker-alive.ts
similarity index 85%
rename from src/client/utils/keep-service-worker-alive.ts
rename to src/virtual/utils/keep-service-worker-alive.ts
index c465b477..6a76d31a 100644
--- a/src/client/utils/keep-service-worker-alive.ts
+++ b/src/virtual/utils/keep-service-worker-alive.ts
@@ -1,4 +1,4 @@
-import browser from 'webextension-polyfill';
+import { browser } from 'wxt/browser';
 
 /**
  * https://developer.chrome.com/blog/longer-esw-lifetimes/
diff --git a/src/client/utils/reload-content-scripts.ts b/src/virtual/utils/reload-content-scripts.ts
similarity index 74%
rename from src/client/utils/reload-content-scripts.ts
rename to src/virtual/utils/reload-content-scripts.ts
index 73994819..a623c30d 100644
--- a/src/client/utils/reload-content-scripts.ts
+++ b/src/virtual/utils/reload-content-scripts.ts
@@ -1,8 +1,14 @@
-import browser, { Manifest } from 'webextension-polyfill';
-import { logger } from './logger';
-import { MatchPattern } from '@webext-core/match-patterns';
+import { browser } from 'wxt/browser';
+import { logger } from '../../sandbox/utils/logger';
+import { MatchPattern } from 'wxt/sandbox';
 
-export function reloadContentScript(contentScript: Manifest.ContentScript) {
+interface ContentScript {
+  matches: string[];
+  js?: string[];
+  css?: string[];
+}
+
+export function reloadContentScript(contentScript: ContentScript) {
   const manifest = browser.runtime.getManifest();
   if (manifest.manifest_version == 2) {
     void reloadContentScriptMv2(contentScript);
@@ -11,9 +17,7 @@ export function reloadContentScript(contentScript: Manifest.ContentScript) {
   }
 }
 
-export async function reloadContentScriptMv3(
-  contentScript: Manifest.ContentScript,
-) {
+export async function reloadContentScriptMv3(contentScript: ContentScript) {
   const id = `wxt:${contentScript.js![0]}`;
   logger.log('Reloading content script:', contentScript);
   const registered = await browser.scripting.getRegisteredContentScripts();
@@ -41,8 +45,6 @@ export async function reloadContentScriptMv3(
   await Promise.all(matchingTabs.map((tab) => browser.tabs.reload(tab.id)));
 }
 
-export async function reloadContentScriptMv2(
-  contentScript: Manifest.ContentScript,
-) {
+export async function reloadContentScriptMv2(contentScript: ContentScript) {
   throw Error('TODO: reloadContentScriptMv2');
 }
diff --git a/src/client/utils/setup-web-socket.ts b/src/virtual/utils/setup-web-socket.ts
similarity index 95%
rename from src/client/utils/setup-web-socket.ts
rename to src/virtual/utils/setup-web-socket.ts
index 55c93214..9e1b58e4 100644
--- a/src/client/utils/setup-web-socket.ts
+++ b/src/virtual/utils/setup-web-socket.ts
@@ -1,4 +1,4 @@
-import { logger } from './logger';
+import { logger } from '../../sandbox/utils/logger';
 
 interface WebSocketMessage {
   type: string;
diff --git a/src/virtual/virtual-module-globals.d.ts b/src/virtual/virtual-module-globals.d.ts
index a2523d85..c324452f 100644
--- a/src/virtual/virtual-module-globals.d.ts
+++ b/src/virtual/virtual-module-globals.d.ts
@@ -1,34 +1,39 @@
 // Types required to make the virtual modules happy.
 
-declare module '*?raw' {
-  const content: any;
-  export default content;
-}
-
 declare module 'virtual:user-background' {
-  const definition: import('~/types').BackgroundDefinition;
+  const definition: { main: () => void };
   export default definition;
 }
 
 declare module 'virtual:user-content-script-isolated-world' {
-  const definition: import('~/types').ContentScriptIsolatedWorldDefinition;
+  const definition: {
+    main: (
+      ctx: import('wxt/client').ContentScriptContext,
+    ) => void | Promise<void>;
+  };
   export default definition;
 }
 
 declare module 'virtual:user-content-script-main-world' {
-  const definition: import('~/types').ContentScriptMainWorldDefinition;
+  const definition: { main: () => void | Promise<void> };
   export default definition;
 }
 
 declare module 'virtual:user-unlisted-script' {
-  const definition: import('~/types').UnlistedScriptDefinition;
+  const definition: { main: () => void | Promise<void> };
   export default definition;
 }
 
-// Globals defined by the vite-plugins/devServerGlobals.ts and utils/globals.ts
-declare const __COMMAND__: 'build' | 'serve';
-declare const __DEV_SERVER_PROTOCOL__: string;
-declare const __DEV_SERVER_HOSTNAME__: string;
-declare const __DEV_SERVER_PORT__: string;
-declare const __MANIFEST_VERSION__: 2 | 3;
-declare const __ENTRYPOINT__: string;
+declare module 'wxt/browser' {
+  export const browser: import('webextension-polyfill').Browser;
+}
+
+declare module 'wxt/client' {
+  export class ContentScriptContext {
+    constructor(name: string, options: any);
+  }
+}
+
+declare module 'wxt/testing' {
+  export const fakeBrowser: import('webextension-polyfill').Browser;
+}
diff --git a/tsconfig.json b/tsconfig.json
index de22f577..221324d8 100644
--- a/tsconfig.json
+++ b/tsconfig.json
@@ -5,5 +5,5 @@
       "~/*": ["./src/*"]
     }
   },
-  "exclude": ["dist", "demo", "e2e/dist", "templates"]
+  "exclude": ["dist", "demo", "e2e/dist", "templates", "src/virtual"]
 }
diff --git a/vitest.workspace.ts b/vitest.workspace.ts
index dafc2686..1a82c8ee 100644
--- a/vitest.workspace.ts
+++ b/vitest.workspace.ts
@@ -20,6 +20,7 @@ const resolve = {
   alias: {
     '~': path.resolve('src'),
     'webextension-polyfill': path.resolve('src/virtual/mock-browser'),
+    'wxt/testing': path.resolve('src/testing'),
   },
 };