diff --git a/packages/angular_devkit/build_angular/src/babel/presets/application.ts b/packages/angular_devkit/build_angular/src/babel/presets/application.ts
index c34c5431e4f0..fcc6b3bdd79f 100644
--- a/packages/angular_devkit/build_angular/src/babel/presets/application.ts
+++ b/packages/angular_devkit/build_angular/src/babel/presets/application.ts
@@ -20,7 +20,6 @@ export interface ApplicationPresetOptions {
   angularLinker?: {
     shouldLink: boolean;
     jitMode: boolean;
-    sourcemap: boolean;
   };
 
   forceES5?: boolean;
@@ -138,7 +137,8 @@ export default function (api: unknown, options: ApplicationPresetOptions) {
     plugins.push(
       createEs2015LinkerPlugin({
         linkerJitMode: options.angularLinker.jitMode,
-        sourceMapping: options.angularLinker.sourcemap,
+        // This is a workaround until https://github.com/angular/angular/issues/42769 is fixed.
+        sourceMapping: false,
         logger: createNgtscLogger(options.diagnosticReporter),
         fileSystem: {
           resolve: path.resolve,
diff --git a/packages/angular_devkit/build_angular/src/babel/webpack-loader.ts b/packages/angular_devkit/build_angular/src/babel/webpack-loader.ts
index dbbc248b1045..ba6b2583e1c3 100644
--- a/packages/angular_devkit/build_angular/src/babel/webpack-loader.ts
+++ b/packages/angular_devkit/build_angular/src/babel/webpack-loader.ts
@@ -58,7 +58,6 @@ export default custom<AngularCustomOptions>(() => {
         customOptions.angularLinker = {
           shouldLink: true,
           jitMode: aot !== true,
-          sourcemap: false,
         };
         shouldProcess = true;
       }
@@ -141,15 +140,6 @@ export default custom<AngularCustomOptions>(() => {
         );
       }
 
-      // Only enable linker template sourcemapping if linker is enabled and Webpack provides
-      // a sourcemap. This logic allows the linker sourcemap behavior to be controlled by the
-      // Webpack sourcemap configuration. For example, if a vendor file is being processed
-      // and vendor sourcemaps are disabled, the `inputSourceMap` property will be `undefined`
-      // which will effectively disable linker sourcemapping for vendor files.
-      if (customOptions.angularLinker && configuration.options.inputSourceMap) {
-        customOptions.angularLinker.sourcemap = true;
-      }
-
       return {
         ...configuration.options,
         // Workaround for https://github.com/babel/babel-loader/pull/896 is available
diff --git a/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-full.ts b/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-full.ts
index b523bbc67bb1..27443966a96c 100644
--- a/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-full.ts
+++ b/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-full.ts
@@ -1,11 +1,21 @@
-import { writeFile } from '../../../utils/fs';
+import { expectFileToMatch, writeMultipleFiles } from '../../../utils/fs';
 import { ng } from '../../../utils/process';
 import { updateJsonFile } from '../../../utils/project';
 
 export default async function () {
   await ng('generate', 'library', 'my-lib');
 
-  await writeFile('./src/app/app.module.ts', `
+  // Force an external template
+  await writeMultipleFiles({
+    'projects/my-lib/src/lib/my-lib.component.html': `<p>my-lib works!</p>`,
+    'projects/my-lib/src/lib/my-lib.component.ts': `import { Component } from '@angular/core';
+
+      @Component({
+        selector: 'lib-my-lib',
+        templateUrl: './my-lib.component.html',
+      })
+      export class MyLibComponent {}`,
+    './src/app/app.module.ts': `
       import { BrowserModule } from '@angular/platform-browser';
       import { NgModule } from '@angular/core';
       import { MyLibModule } from 'my-lib';
@@ -24,9 +34,8 @@ export default async function () {
         bootstrap: [AppComponent]
       })
       export class AppModule { }
-    `);
-
-  await writeFile('./src/app/app.component.ts', `
+    `,
+    './src/app/app.component.ts': `
       import { Component } from '@angular/core';
       import { MyLibService } from 'my-lib';
 
@@ -41,9 +50,8 @@ export default async function () {
           console.log(myLibService);
         }
       }
-    `);
-
-  await writeFile('e2e/src/app.e2e-spec.ts', `
+    `,
+    'e2e/src/app.e2e-spec.ts': `
     import { browser, logging, element, by } from 'protractor';
     import { AppPage } from './app.po';
 
@@ -67,7 +75,8 @@ export default async function () {
         }));
       });
     });
-  `);
+  `,
+  });
 
   // Build library in full mode (development)
   await ng('build', 'my-lib', '--configuration=development');
@@ -76,7 +85,7 @@ export default async function () {
   await runTests();
 
   // JIT linking
-  await updateJsonFile('angular.json', config => {
+  await updateJsonFile('angular.json', (config) => {
     const build = config.projects['test-project'].architect.build;
     build.options.aot = false;
     build.configurations.production.buildOptimizer = false;
@@ -89,4 +98,8 @@ async function runTests(): Promise<void> {
   // Check that the tests succeeds both with named project, unnamed (should test app), and prod.
   await ng('e2e');
   await ng('e2e', 'test-project', '--devServerTarget=test-project:serve:production');
+
+  // Validate that sourcemaps for the library exists.
+  await ng('build', '--configuration=development');
+  await expectFileToMatch('dist/test-project/main.js.map', 'projects/my-lib/src/public-api.ts');
 }
diff --git a/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-partial.ts b/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-partial.ts
index 076ceb65cd80..4ca8f3fb3ad7 100644
--- a/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-partial.ts
+++ b/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-partial.ts
@@ -1,11 +1,21 @@
-import { writeFile } from '../../../utils/fs';
+import { expectFileToMatch, writeMultipleFiles } from '../../../utils/fs';
 import { ng } from '../../../utils/process';
 import { updateJsonFile } from '../../../utils/project';
 
 export default async function () {
   await ng('generate', 'library', 'my-lib');
 
-  await writeFile('./src/app/app.module.ts', `
+  // Force an external template
+  await writeMultipleFiles({
+    'projects/my-lib/src/lib/my-lib.component.html': `<p>my-lib works!</p>`,
+    'projects/my-lib/src/lib/my-lib.component.ts': `import { Component } from '@angular/core';
+
+      @Component({
+        selector: 'lib-my-lib',
+        templateUrl: './my-lib.component.html',
+      })
+      export class MyLibComponent {}`,
+    './src/app/app.module.ts': `
       import { BrowserModule } from '@angular/platform-browser';
       import { NgModule } from '@angular/core';
       import { MyLibModule } from 'my-lib';
@@ -24,9 +34,8 @@ export default async function () {
         bootstrap: [AppComponent]
       })
       export class AppModule { }
-    `);
-
-  await writeFile('./src/app/app.component.ts', `
+    `,
+    './src/app/app.component.ts': `
       import { Component } from '@angular/core';
       import { MyLibService } from 'my-lib';
 
@@ -41,9 +50,8 @@ export default async function () {
           console.log(myLibService);
         }
       }
-    `);
-
-  await writeFile('e2e/src/app.e2e-spec.ts', `
+    `,
+    'e2e/src/app.e2e-spec.ts': `
     import { browser, logging, element, by } from 'protractor';
     import { AppPage } from './app.po';
 
@@ -67,7 +75,8 @@ export default async function () {
         }));
       });
     });
-  `);
+  `,
+  });
 
   // Build library in partial mode (production)
   await ng('build', 'my-lib', '--configuration=production');
@@ -76,7 +85,7 @@ export default async function () {
   await runTests();
 
   // JIT linking
-  await updateJsonFile('angular.json', config => {
+  await updateJsonFile('angular.json', (config) => {
     const build = config.projects['test-project'].architect.build;
     build.options.aot = false;
     build.configurations.production.buildOptimizer = false;
@@ -89,4 +98,8 @@ async function runTests(): Promise<void> {
   // Check that the tests succeeds both with named project, unnamed (should test app), and prod.
   await ng('e2e');
   await ng('e2e', 'test-project', '--devServerTarget=test-project:serve:production');
+
+  // Validate that sourcemaps for the library exists.
+  await ng('build', '--configuration=development');
+  await expectFileToMatch('dist/test-project/main.js.map', 'projects/my-lib/src/public-api.ts');
 }
diff --git a/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ve.ts b/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ve.ts
index 34c4114fdf8f..7341457faafa 100644
--- a/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ve.ts
+++ b/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ve.ts
@@ -1,11 +1,11 @@
-import { writeFile } from '../../../utils/fs';
+import { expectFileToMatch, writeMultipleFiles } from '../../../utils/fs';
 import { ng } from '../../../utils/process';
 import { updateJsonFile } from '../../../utils/project';
 
 export default async function () {
   await ng('generate', 'library', 'my-lib');
 
-  await updateJsonFile('projects/my-lib/tsconfig.lib.prod.json', config => {
+  await updateJsonFile('projects/my-lib/tsconfig.lib.prod.json', (config) => {
     const { angularCompilerOptions = {} } = config;
     angularCompilerOptions.enableIvy = false;
     angularCompilerOptions.skipTemplateCodegen = true;
@@ -13,7 +13,17 @@ export default async function () {
     config.angularCompilerOptions = angularCompilerOptions;
   });
 
-  await writeFile('./src/app/app.module.ts', `
+  // Force an external template
+  await writeMultipleFiles({
+    'projects/my-lib/src/lib/my-lib.component.html': `<p>my-lib works!</p>`,
+    'projects/my-lib/src/lib/my-lib.component.ts': `import { Component } from '@angular/core';
+
+      @Component({
+        selector: 'lib-my-lib',
+        templateUrl: './my-lib.component.html',
+      })
+      export class MyLibComponent {}`,
+    './src/app/app.module.ts': `
       import { BrowserModule } from '@angular/platform-browser';
       import { NgModule } from '@angular/core';
       import { MyLibModule } from 'my-lib';
@@ -32,9 +42,8 @@ export default async function () {
         bootstrap: [AppComponent]
       })
       export class AppModule { }
-    `);
-
-  await writeFile('./src/app/app.component.ts', `
+    `,
+    './src/app/app.component.ts': `
       import { Component } from '@angular/core';
       import { MyLibService } from 'my-lib';
 
@@ -49,9 +58,8 @@ export default async function () {
           console.log(myLibService);
         }
       }
-    `);
-
-  await writeFile('e2e/src/app.e2e-spec.ts', `
+    `,
+    'e2e/src/app.e2e-spec.ts': `
     import { browser, logging, element, by } from 'protractor';
     import { AppPage } from './app.po';
 
@@ -75,7 +83,8 @@ export default async function () {
         }));
       });
     });
-  `);
+  `,
+  });
 
   // Build library in VE mode (production)
   await ng('build', 'my-lib', '--configuration=production');
@@ -84,7 +93,7 @@ export default async function () {
   await runTests();
 
   // JIT linking
-  await updateJsonFile('angular.json', config => {
+  await updateJsonFile('angular.json', (config) => {
     const build = config.projects['test-project'].architect.build;
     build.options.aot = false;
     build.configurations.production.buildOptimizer = false;
@@ -97,4 +106,8 @@ async function runTests(): Promise<void> {
   // Check that the tests succeeds both with named project, unnamed (should test app), and prod.
   await ng('e2e');
   await ng('e2e', 'test-project', '--devServerTarget=test-project:serve:production');
+
+  // Validate that sourcemaps for the library exists.
+  await ng('build', '--configuration=development');
+  await expectFileToMatch('dist/test-project/main.js.map', 'projects/my-lib/src/public-api.ts');
 }