diff --git a/.changeset/orange-swans-relax.md b/.changeset/orange-swans-relax.md
new file mode 100644
index 00000000000..6f7d006dae6
--- /dev/null
+++ b/.changeset/orange-swans-relax.md
@@ -0,0 +1,6 @@
+---
+"@pnpm/symlink-dependency": patch
+"pnpm": patch
+---
+
+Symlink a local dependency to `node_modules`, even if the target directory doesn't exist [#5219](https://github.com/pnpm/pnpm/issues/5219).
diff --git a/packages/symlink-dependency/jest.config.js b/packages/symlink-dependency/jest.config.js
new file mode 100644
index 00000000000..f697d831691
--- /dev/null
+++ b/packages/symlink-dependency/jest.config.js
@@ -0,0 +1 @@
+module.exports = require('../../jest.config.js')
diff --git a/packages/symlink-dependency/package.json b/packages/symlink-dependency/package.json
index ce49bbb7234..d598c0e580e 100644
--- a/packages/symlink-dependency/package.json
+++ b/packages/symlink-dependency/package.json
@@ -16,6 +16,7 @@
   },
   "devDependencies": {
     "@pnpm/logger": "^4.0.0",
+    "@pnpm/prepare": "workspace:*",
     "@pnpm/symlink-dependency": "workspace:*"
   },
   "directories": {
@@ -33,10 +34,11 @@
   "repository": "https://github.com/pnpm/pnpm/blob/main/packages/symlink-dependency",
   "scripts": {
     "start": "tsc --watch",
-    "test": "pnpm run compile",
-    "lint": "eslint src/**/*.ts",
+    "test": "pnpm run compile && pnpm run _test",
+    "lint": "eslint src/**/*.ts test/**/*.ts",
     "prepublishOnly": "pnpm run compile",
-    "compile": "tsc --build && pnpm run lint --fix"
+    "compile": "tsc --build && pnpm run lint --fix",
+    "_test": "jest"
   },
   "dependencies": {
     "@pnpm/core-loggers": "workspace:*",
diff --git a/packages/symlink-dependency/src/symlinkDirectRootDependency.ts b/packages/symlink-dependency/src/symlinkDirectRootDependency.ts
index 8d060d81bdd..3e1ef4b1e05 100644
--- a/packages/symlink-dependency/src/symlinkDirectRootDependency.ts
+++ b/packages/symlink-dependency/src/symlinkDirectRootDependency.ts
@@ -50,7 +50,10 @@ export default async function symlinkDirectRootDependency (
   } catch (err: any) { // eslint-disable-line
     if (err.code !== 'ENOENT') throw err
     globalWarn(`Local dependency not found at ${dependencyLocation}`)
-    return
+    // Sometimes the linked in local package does not exist during installation
+    // and is created later via a build script.
+    // That is why we create the symlink even if the target directory does not exist.
+    dependencyRealLocation = dependencyLocation
   }
 
   const dest = path.join(destModulesDirReal, importAs)
diff --git a/packages/symlink-dependency/test/symlinkDirectRootDependency.test.ts b/packages/symlink-dependency/test/symlinkDirectRootDependency.test.ts
new file mode 100644
index 00000000000..737d7fad1eb
--- /dev/null
+++ b/packages/symlink-dependency/test/symlinkDirectRootDependency.test.ts
@@ -0,0 +1,21 @@
+import fs from 'fs'
+import path from 'path'
+import { tempDir } from '@pnpm/prepare'
+import { symlinkDirectRootDependency } from '@pnpm/symlink-dependency'
+
+test('symlink is created to directory that does not yet exist', async () => {
+  const tmp = tempDir(false)
+  const destModulesDir = path.join(tmp, 'node_modules')
+  const dependencyLocation = path.join(tmp, 'dep')
+  fs.mkdirSync(destModulesDir)
+  await symlinkDirectRootDependency(dependencyLocation, destModulesDir, 'dep', {
+    linkedPackage: {
+      name: 'dep',
+      version: '1.0.0',
+    },
+    prefix: '',
+  })
+  fs.mkdirSync(dependencyLocation)
+  fs.writeFileSync(path.join(dependencyLocation, 'index.js'), 'module.exports = {}')
+  expect(fs.existsSync(path.join(destModulesDir, 'dep/index.js'))).toBe(true)
+})
diff --git a/packages/symlink-dependency/tsconfig.json b/packages/symlink-dependency/tsconfig.json
index 2cce143602d..783b976c392 100644
--- a/packages/symlink-dependency/tsconfig.json
+++ b/packages/symlink-dependency/tsconfig.json
@@ -9,6 +9,9 @@
     "../../typings/**/*.d.ts"
   ],
   "references": [
+    {
+      "path": "../../privatePackages/prepare"
+    },
     {
       "path": "../core-loggers"
     },
diff --git a/pnpm-lock.yaml b/pnpm-lock.yaml
index 25fc9544a3c..c5e823e6da5 100644
--- a/pnpm-lock.yaml
+++ b/pnpm-lock.yaml
@@ -5031,6 +5031,9 @@ importers:
       '@pnpm/logger':
         specifier: ^4.0.0
         version: 4.0.0
+      '@pnpm/prepare':
+        specifier: workspace:*
+        version: link:../../privatePackages/prepare
       '@pnpm/symlink-dependency':
         specifier: workspace:*
         version: 'link:'