diff --git a/common/changes/@microsoft/rush/rush-sdk-webpack_2022-02-05-03-03.json b/common/changes/@microsoft/rush/rush-sdk-webpack_2022-02-05-03-03.json
new file mode 100644
index 00000000000..ded1596f677
--- /dev/null
+++ b/common/changes/@microsoft/rush/rush-sdk-webpack_2022-02-05-03-03.json
@@ -0,0 +1,10 @@
+{
+  "changes": [
+    {
+      "packageName": "@microsoft/rush",
+      "comment": "Add support for rush-sdk to be bundled with Webpack.",
+      "type": "none"
+    }
+  ],
+  "packageName": "@microsoft/rush"
+}
\ No newline at end of file
diff --git a/common/config/rush/pnpm-lock.yaml b/common/config/rush/pnpm-lock.yaml
index 464eba84b9e..7a8ced6712c 100644
--- a/common/config/rush/pnpm-lock.yaml
+++ b/common/config/rush/pnpm-lock.yaml
@@ -1634,9 +1634,9 @@ importers:
       '@rushstack/heft-node-rig': workspace:*
       '@rushstack/node-core-library': workspace:*
       '@types/heft-jest': 1.0.1
-      '@types/node': 12.20.24
       '@types/node-fetch': 1.6.9
       '@types/semver': 7.3.5
+      '@types/webpack-env': 1.13.0
       tapable: 2.2.1
     dependencies:
       '@rushstack/node-core-library': link:../node-core-library
@@ -1648,8 +1648,8 @@ importers:
       '@rushstack/heft': link:../../apps/heft
       '@rushstack/heft-node-rig': link:../../rigs/heft-node-rig
       '@types/heft-jest': 1.0.1
-      '@types/node': 12.20.24
       '@types/semver': 7.3.5
+      '@types/webpack-env': 1.13.0
 
   ../../libraries/rushell:
     specifiers:
diff --git a/libraries/rush-sdk/config/typescript.json b/libraries/rush-sdk/config/typescript.json
new file mode 100644
index 00000000000..9da485f84fb
--- /dev/null
+++ b/libraries/rush-sdk/config/typescript.json
@@ -0,0 +1,9 @@
+/**
+ * Configures the TypeScript plugin for Heft.  This plugin also manages linting.
+ */
+{
+  "$schema": "https://developer.microsoft.com/json-schemas/heft/typescript.schema.json",
+  "extends": "@rushstack/heft-node-rig/profiles/default/config/typescript.json",
+
+  "emitMjsExtensionForESModule": true
+}
diff --git a/libraries/rush-sdk/package.json b/libraries/rush-sdk/package.json
index 42826ce4100..f6631d5841a 100644
--- a/libraries/rush-sdk/package.json
+++ b/libraries/rush-sdk/package.json
@@ -9,6 +9,7 @@
   },
   "homepage": "https://rushjs.io",
   "main": "lib/index.js",
+  "module": "lib/index.mjs",
   "typings": "dist/rush-lib.d.ts",
   "scripts": {
     "build": "heft build --clean",
@@ -27,7 +28,7 @@
     "@rushstack/heft": "workspace:*",
     "@rushstack/heft-node-rig": "workspace:*",
     "@types/heft-jest": "1.0.1",
-    "@types/node": "12.20.24",
-    "@types/semver": "7.3.5"
+    "@types/semver": "7.3.5",
+    "@types/webpack-env": "1.13.0"
   }
 }
diff --git a/libraries/rush-sdk/src/index.ts b/libraries/rush-sdk/src/index.ts
index 54501826052..e619eca098d 100644
--- a/libraries/rush-sdk/src/index.ts
+++ b/libraries/rush-sdk/src/index.ts
@@ -31,6 +31,18 @@ declare const global: NodeJS.Global &
     ___rush___rushLibModuleFromInstallAndRunRush?: RushLibModuleType;
   };
 
+function _require<TResult>(moduleName: string): TResult {
+  if (typeof __non_webpack_require__ === 'function') {
+    // If this library has been bundled with Webpack, we need to call the real `require` function
+    // that doesn't get turned into a `__webpack_require__` statement.
+    // `__non_webpack_require__` is a Webpack macro that gets turned into a `require` statement
+    // during bundling.
+    return __non_webpack_require__(moduleName);
+  } else {
+    return require(moduleName);
+  }
+}
+
 // SCENARIO 1:  Rush's PluginManager has initialized "rush-sdk" with Rush's own instance of rush-lib.
 // The Rush host process will assign "global.___rush___rushLibModule" before loading the plugin.
 let rushLibModule: RushLibModuleType | undefined =
@@ -40,13 +52,13 @@ let errorMessage: string = '';
 // SCENARIO 2:  The project importing "rush-sdk" has installed its own instance of "rush-lib"
 // as a package.json dependency.  For example, this is used by the Jest tests for Rush plugins.
 if (rushLibModule === undefined) {
-  const importingPath: string | undefined = module?.parent?.filename;
-  if (importingPath !== undefined) {
+  const importingPath: string | null | undefined = module?.parent?.filename;
+  if (importingPath) {
     const callerPackageFolder: string | undefined =
       PackageJsonLookup.instance.tryGetPackageFolderFor(importingPath);
 
     if (callerPackageFolder !== undefined) {
-      const callerPackageJson: IPackageJson = require(path.join(callerPackageFolder, 'package.json'));
+      const callerPackageJson: IPackageJson = _require(path.join(callerPackageFolder, 'package.json'));
 
       // Does the caller properly declare a dependency on rush-lib?
       if (
@@ -123,7 +135,9 @@ if (rushLibModule === undefined) {
         }
 
         // Retry to load "rush-lib" after install-run-rush run
-        terminal.writeVerboseLine(`Trying to load  ${RUSH_LIB_NAME} installed by install-run-rush a second time`);
+        terminal.writeVerboseLine(
+          `Trying to load  ${RUSH_LIB_NAME} installed by install-run-rush a second time`
+        );
         rushLibModule = requireRushLibUnderFolderPath(installRunNodeModuleFolder);
       } catch (e) {
         console.error(`${installAndRunRushStderrContent}`);
@@ -176,7 +190,7 @@ function requireRushLibUnderFolderPath(folderPath: string): RushLibModuleType {
     baseFolderPath: folderPath
   });
 
-  return require(rushLibModulePath);
+  return _require(rushLibModulePath);
 }
 
 /**
diff --git a/libraries/rush-sdk/src/test/script.test.ts b/libraries/rush-sdk/src/test/script.test.ts
index a367dce25c4..e795a0abedc 100644
--- a/libraries/rush-sdk/src/test/script.test.ts
+++ b/libraries/rush-sdk/src/test/script.test.ts
@@ -15,16 +15,16 @@ describe('used in script', () => {
       [
         '-e',
         `
-const { Import } = require("${coreLibPath}");
+const { Import } = require(${JSON.stringify(coreLibPath)});
 const originalResolveModule = Import.resolveModule;
 const mockResolveModule = (options) => {
   if (options.baseFolderPath.includes('install-run') && options.modulePath === '@microsoft/rush-lib') {
-    return "${mockRushLibPath}";
+    return ${JSON.stringify(mockRushLibPath)};
   }
   return originalResolveModule(options);
 }
 Import.resolveModule = mockResolveModule;
-console.log(require("${rushSdkPath}"));
+console.log(require(${JSON.stringify(rushSdkPath)}));
 `
       ],
       {
diff --git a/libraries/rush-sdk/tsconfig.json b/libraries/rush-sdk/tsconfig.json
index 22f94ca28b5..ab74a420295 100644
--- a/libraries/rush-sdk/tsconfig.json
+++ b/libraries/rush-sdk/tsconfig.json
@@ -1,6 +1,9 @@
 {
   "extends": "./node_modules/@rushstack/heft-node-rig/profiles/default/tsconfig-base.json",
   "compilerOptions": {
-    "types": ["heft-jest", "node"]
+    "types": [
+      "heft-jest",
+      "webpack-env" // Use webpack-env here instead of node so we have __non_webpack_require__
+    ]
   }
 }