diff --git a/packages/next/plugins/component-testing.ts b/packages/next/plugins/component-testing.ts
index 0c2ccba5bc3fb..efc0f3389505f 100644
--- a/packages/next/plugins/component-testing.ts
+++ b/packages/next/plugins/component-testing.ts
@@ -127,6 +127,7 @@ Able to find CT project, ${!!ctProjectConfig}.`);
     projectRoot: ctProjectConfig.root,
     sourceRoot: ctProjectConfig.sourceRoot,
     main: '',
+    useTsconfigPaths: undefined,
     fileReplacements: buildFileReplacements,
     assets: buildAssets,
     outputPath: buildOuputPath,
diff --git a/packages/rspack/src/executors/rspack/lib/normalize-options.ts b/packages/rspack/src/executors/rspack/lib/normalize-options.ts
index e1474a0e18138..b389b9a242b40 100644
--- a/packages/rspack/src/executors/rspack/lib/normalize-options.ts
+++ b/packages/rspack/src/executors/rspack/lib/normalize-options.ts
@@ -8,6 +8,7 @@ import type {
   RspackExecutorSchema,
   NormalizedRspackExecutorSchema,
 } from '../schema';
+import { isUsingTsSolutionSetup } from '@nx/js/src/utils/typescript/ts-solution-setup';
 
 export function normalizeOptions(
   options: RspackExecutorSchema,
@@ -17,6 +18,7 @@ export function normalizeOptions(
 ): NormalizedRspackExecutorSchema {
   const normalizedOptions = {
     ...options,
+    useTsconfigPaths: !isUsingTsSolutionSetup(),
     root,
     projectRoot,
     sourceRoot,
diff --git a/packages/rspack/src/executors/rspack/schema.d.ts b/packages/rspack/src/executors/rspack/schema.d.ts
index 286f42c82b4e5..2ef4a00d0d0fc 100644
--- a/packages/rspack/src/executors/rspack/schema.d.ts
+++ b/packages/rspack/src/executors/rspack/schema.d.ts
@@ -69,4 +69,5 @@ export interface NormalizedRspackExecutorSchema extends RspackExecutorSchema {
   root: string;
   projectRoot: string;
   sourceRoot: string;
+  useTsconfigPaths: boolean;
 }
diff --git a/packages/rspack/src/plugins/utils/apply-base-config.ts b/packages/rspack/src/plugins/utils/apply-base-config.ts
index 6112c8b6bb9ab..923d3a41382d2 100644
--- a/packages/rspack/src/plugins/utils/apply-base-config.ts
+++ b/packages/rspack/src/plugins/utils/apply-base-config.ts
@@ -217,6 +217,8 @@ function applyNxDependentConfig(
   const tsConfig = options.tsConfig ?? getRootTsConfigPath();
   const plugins: RspackPluginInstance[] = [];
 
+  const isUsingTsSolution = isUsingTsSolutionSetup();
+
   const executorContext: Partial<ExecutorContext> = {
     projectName: options.projectName,
     targetName: options.targetName,
@@ -225,10 +227,14 @@ function applyNxDependentConfig(
     root: options.root,
   };
 
-  plugins.push(new NxTsconfigPathsRspackPlugin({ ...options, tsConfig }));
+  options.useTsconfigPaths ??= !isUsingTsSolution;
+  // If the project is using ts solutions setup, the paths are not in tsconfig and we should not use the plugin's paths.
+  if (options.useTsconfigPaths) {
+    plugins.push(new NxTsconfigPathsRspackPlugin({ ...options, tsConfig }));
+  }
 
   // New TS Solution already has a typecheck target
-  if (!options?.skipTypeChecking && !isUsingTsSolutionSetup()) {
+  if (!options?.skipTypeChecking && !isUsingTsSolution) {
     const ForkTsCheckerWebpackPlugin = require('fork-ts-checker-webpack-plugin');
     plugins.push(
       new ForkTsCheckerWebpackPlugin({
diff --git a/packages/rspack/src/plugins/utils/models.ts b/packages/rspack/src/plugins/utils/models.ts
index 82455ce8fdbea..de43f367983ce 100644
--- a/packages/rspack/src/plugins/utils/models.ts
+++ b/packages/rspack/src/plugins/utils/models.ts
@@ -207,6 +207,10 @@ export interface NxAppRspackPluginOptions {
    * List of TypeScript Compiler Transformers Plugins.
    */
   transformers?: TransformerEntry[];
+  /**
+   * Use tsconfig-paths-webpack-plugin to resolve modules using paths in the tsconfig file.
+   */
+  useTsconfigPaths?: boolean;
   /**
    * Generate a separate vendor chunk for 3rd party packages.
    */
diff --git a/packages/rspack/src/utils/config.ts b/packages/rspack/src/utils/config.ts
index 7a2f191f622f6..d28fcafb0ccd4 100644
--- a/packages/rspack/src/utils/config.ts
+++ b/packages/rspack/src/utils/config.ts
@@ -99,6 +99,7 @@ function ensureNxRspackExecutionContext(ctx: NxRspackExecutionContext): void {
     outputFileName: undefined,
     outputPath: undefined,
     rspackConfig: undefined,
+    useTsconfigPaths: undefined,
   };
   ctx.context ??= {
     projectName,
diff --git a/packages/rspack/src/utils/read-rspack-options.ts b/packages/rspack/src/utils/read-rspack-options.ts
index 6c69c8836b2fc..f303342fb048f 100644
--- a/packages/rspack/src/utils/read-rspack-options.ts
+++ b/packages/rspack/src/utils/read-rspack-options.ts
@@ -31,6 +31,7 @@ export async function readRspackOptions(
           tsConfig: '',
           outputPath: '',
           rspackConfig: '',
+          useTsconfigPaths: undefined,
         },
         context: {
           root: workspaceRoot,
diff --git a/packages/webpack/src/executors/webpack/lib/normalize-options.ts b/packages/webpack/src/executors/webpack/lib/normalize-options.ts
index df6b0198897a7..294f787f9d0ec 100644
--- a/packages/webpack/src/executors/webpack/lib/normalize-options.ts
+++ b/packages/webpack/src/executors/webpack/lib/normalize-options.ts
@@ -8,6 +8,7 @@ import type {
   NormalizedWebpackExecutorOptions,
   WebpackExecutorOptions,
 } from '../schema';
+import { isUsingTsSolutionSetup } from '@nx/js/src/utils/typescript/ts-solution-setup';
 
 export function normalizeOptions(
   options: WebpackExecutorOptions,
@@ -17,6 +18,7 @@ export function normalizeOptions(
 ): NormalizedWebpackExecutorOptions {
   const normalizedOptions = {
     ...options,
+    useTsconfigPaths: !isUsingTsSolutionSetup(),
     root,
     projectRoot,
     sourceRoot,
diff --git a/packages/webpack/src/executors/webpack/schema.d.ts b/packages/webpack/src/executors/webpack/schema.d.ts
index 883e4d91ca9d5..bcc13c2f781e2 100644
--- a/packages/webpack/src/executors/webpack/schema.d.ts
+++ b/packages/webpack/src/executors/webpack/schema.d.ts
@@ -95,4 +95,5 @@ export interface NormalizedWebpackExecutorOptions
   root: string;
   projectRoot: string;
   sourceRoot: string;
+  useTsconfigPaths: boolean;
 }
diff --git a/packages/webpack/src/plugins/nx-webpack-plugin/lib/apply-base-config.ts b/packages/webpack/src/plugins/nx-webpack-plugin/lib/apply-base-config.ts
index 4c49571e3cc80..8378c6ac9abf3 100644
--- a/packages/webpack/src/plugins/nx-webpack-plugin/lib/apply-base-config.ts
+++ b/packages/webpack/src/plugins/nx-webpack-plugin/lib/apply-base-config.ts
@@ -231,10 +231,16 @@ function applyNxDependentConfig(
     root: options.root,
   };
 
-  plugins.push(new NxTsconfigPathsWebpackPlugin({ ...options, tsConfig }));
+  const isUsingTsSolution = isUsingTsSolutionSetup();
+  options.useTsconfigPaths ??= !isUsingTsSolution;
+
+  // If the project is using ts solutions setup, the paths are not in tsconfig and we should not use the plugin's paths.
+  if (options.useTsconfigPaths) {
+    plugins.push(new NxTsconfigPathsWebpackPlugin({ ...options, tsConfig }));
+  }
 
   // New TS Solution already has a typecheck target
-  if (!options?.skipTypeChecking && !isUsingTsSolutionSetup()) {
+  if (!options?.skipTypeChecking && !isUsingTsSolution) {
     const ForkTsCheckerWebpackPlugin = require('fork-ts-checker-webpack-plugin');
     plugins.push(
       new ForkTsCheckerWebpackPlugin({
diff --git a/packages/webpack/src/plugins/nx-webpack-plugin/nx-app-webpack-plugin-options.ts b/packages/webpack/src/plugins/nx-webpack-plugin/nx-app-webpack-plugin-options.ts
index fac494d3ff5c6..cc6cac16aae06 100644
--- a/packages/webpack/src/plugins/nx-webpack-plugin/nx-app-webpack-plugin-options.ts
+++ b/packages/webpack/src/plugins/nx-webpack-plugin/nx-app-webpack-plugin-options.ts
@@ -211,6 +211,10 @@ export interface NxAppWebpackPluginOptions {
    * List of TypeScript Compiler Transformers Plugins.
    */
   transformers?: TransformerEntry[];
+  /**
+   * Use tsconfig-paths-webpack-plugin to resolve modules using paths in the tsconfig file.
+   */
+  useTsconfigPaths?: boolean;
   /**
    * Generate a separate vendor chunk for 3rd party packages.
    */
diff --git a/packages/webpack/src/utils/config.ts b/packages/webpack/src/utils/config.ts
index 67623d2babb1b..c86dd3bad0185 100644
--- a/packages/webpack/src/utils/config.ts
+++ b/packages/webpack/src/utils/config.ts
@@ -99,6 +99,7 @@ function ensureNxWebpackExecutionContext(ctx: NxWebpackExecutionContext): void {
     outputPath: undefined,
     tsConfig: undefined,
     outputFileName: undefined,
+    useTsconfigPaths: undefined,
   };
   ctx.context ??= {
     projectName,
diff --git a/packages/webpack/src/utils/webpack/read-webpack-options.ts b/packages/webpack/src/utils/webpack/read-webpack-options.ts
index 50f8782d60c49..0e13f134de8df 100644
--- a/packages/webpack/src/utils/webpack/read-webpack-options.ts
+++ b/packages/webpack/src/utils/webpack/read-webpack-options.ts
@@ -28,6 +28,7 @@ export async function readWebpackOptions(
           outputFileName: undefined,
           outputPath: undefined,
           assets: undefined,
+          useTsconfigPaths: undefined,
         },
         context: {
           root: workspaceRoot,