diff --git a/packages/core/src/runtime/worker/loadModule.ts b/packages/core/src/runtime/worker/loadModule.ts
index 75b0cc88..79a75fa2 100644
--- a/packages/core/src/runtime/worker/loadModule.ts
+++ b/packages/core/src/runtime/worker/loadModule.ts
@@ -15,7 +15,15 @@ const createRequire = (
   assetFiles: Record<string, string>,
   interopDefault: boolean,
 ): NodeJS.Require => {
-  const _require = createNativeRequire(filename);
+  const _require = (() => {
+    try {
+      // compat with some testPath may not be an available path but the third-party package name
+      return createNativeRequire(filename);
+    } catch (_err) {
+      return createNativeRequire(distPath);
+    }
+  })();
+
   const require = ((id: string) => {
     const currentDirectory = path.dirname(distPath);
 
diff --git a/packages/core/src/utils/testFiles.ts b/packages/core/src/utils/testFiles.ts
index 55406835..e447a40a 100644
--- a/packages/core/src/utils/testFiles.ts
+++ b/packages/core/src/utils/testFiles.ts
@@ -1,5 +1,6 @@
 import { existsSync } from 'node:fs';
 import fs from 'node:fs/promises';
+import { createRequire } from 'node:module';
 import pathe from 'pathe';
 import { glob } from 'tinyglobby';
 import { castArray, color, getAbsolutePath, parsePosix } from './helper';
@@ -98,6 +99,15 @@ export const getTestEntries = async ({
   );
 };
 
+const tryResolve = (request: string, rootPath: string) => {
+  try {
+    const require = createRequire(rootPath);
+    return require.resolve(request, { paths: [rootPath] });
+  } catch (_err) {
+    return undefined;
+  }
+};
+
 export const getSetupFiles = (
   setups: string[] | string | undefined,
   rootPath: string,
@@ -105,16 +115,23 @@ export const getSetupFiles = (
   return Object.fromEntries(
     castArray(setups).map((setupFile) => {
       const setupFilePath = getAbsolutePath(rootPath, setupFile);
-
-      if (!existsSync(setupFilePath)) {
-        let errorMessage = `Setup file ${color.red(setupFile)} not found`;
-        if (setupFilePath !== setupFile) {
-          errorMessage += color.gray(` (resolved path: ${setupFilePath})`);
+      try {
+        if (!existsSync(setupFilePath)) {
+          let errorMessage = `Setup file ${color.red(setupFile)} not found`;
+          if (setupFilePath !== setupFile) {
+            errorMessage += color.gray(` (resolved path: ${setupFilePath})`);
+          }
+          throw errorMessage;
+        }
+        const relativePath = pathe.relative(rootPath, setupFilePath);
+        return [formatTestEntryName(relativePath), setupFilePath];
+      } catch (err) {
+        // support use package name as setupFiles value
+        if (tryResolve(setupFile, rootPath)) {
+          return [formatTestEntryName(setupFile), setupFile];
         }
-        throw errorMessage;
+        throw err;
       }
-      const relativePath = pathe.relative(rootPath, setupFilePath);
-      return [formatTestEntryName(relativePath), setupFilePath];
     }),
   );
 };
diff --git a/tests/setup/fixtures/package-name/index.test.ts b/tests/setup/fixtures/package-name/index.test.ts
new file mode 100644
index 00000000..889f0816
--- /dev/null
+++ b/tests/setup/fixtures/package-name/index.test.ts
@@ -0,0 +1,6 @@
+import { expect, it } from '@rstest/core';
+
+it('should run setup file correctly', () => {
+  expect(process.env.RETEST_SETUP_FLAG).toBe('1');
+  expect(process.env.NODE_ENV).toBe('rstest:production');
+});
diff --git a/tests/setup/fixtures/package-name/rstest.config.ts b/tests/setup/fixtures/package-name/rstest.config.ts
new file mode 100644
index 00000000..2bd065e8
--- /dev/null
+++ b/tests/setup/fixtures/package-name/rstest.config.ts
@@ -0,0 +1,15 @@
+import { join } from 'node:path';
+import { defineConfig } from '@rstest/core';
+
+import fse from 'fs-extra';
+
+fse.copySync(
+  join(__dirname, './test-setup-fixtures'),
+  join(__dirname, './node_modules/test-setup'),
+);
+
+export default defineConfig({
+  passWithNoTests: true,
+  setupFiles: ['test-setup'],
+  exclude: ['**/node_modules/**', '**/dist/**'],
+});
diff --git a/tests/setup/fixtures/package-name/test-setup-fixtures/index.js b/tests/setup/fixtures/package-name/test-setup-fixtures/index.js
new file mode 100644
index 00000000..a778887b
--- /dev/null
+++ b/tests/setup/fixtures/package-name/test-setup-fixtures/index.js
@@ -0,0 +1,2 @@
+process.env.RETEST_SETUP_FLAG = '1';
+process.env.NODE_ENV = 'rstest:production';
diff --git a/tests/setup/fixtures/package-name/test-setup-fixtures/package.json b/tests/setup/fixtures/package-name/test-setup-fixtures/package.json
new file mode 100644
index 00000000..a431c32f
--- /dev/null
+++ b/tests/setup/fixtures/package-name/test-setup-fixtures/package.json
@@ -0,0 +1,6 @@
+{
+  "private": true,
+  "name": "@rstest/tests-setup",
+  "main": "index.js",
+  "version": "1.0.0"
+}
diff --git a/tests/setup/index.test.ts b/tests/setup/index.test.ts
index 14ca61e0..7e9409e6 100644
--- a/tests/setup/index.test.ts
+++ b/tests/setup/index.test.ts
@@ -46,4 +46,17 @@ describe('test setup file', async () => {
       logs.find((log) => log.includes('rstest.setup.ts:1:7')),
     ).toBeTruthy();
   });
+
+  it('should run setup file correctly when setupFiles value is package name', async () => {
+    const { expectExecSuccess } = await runRstestCli({
+      command: 'rstest',
+      args: ['run'],
+      options: {
+        nodeOptions: {
+          cwd: join(__dirname, 'fixtures/package-name'),
+        },
+      },
+    });
+    await expectExecSuccess();
+  });
 });