VS Code always prompts: "older version of PackageManagement known to cause issues"

Question

I am using the current VS Code (1.53.2) on Win 10

Every time I run it, I get this message:

You have an older version of PackageManagement known to cause issues with the PowerShell extension. Would you like to update PackageManagement (You will need to restart the PowerShell extension after)?

I have done the update (which appears to run cleanly), restarted, all that, but this just keeps coming up.

How to resolve all the way?

Answer 1

In my case only manual installing of latest stable PackageManagement and PowerShellGet modules from https://www.powershellgallery.com helped. See this guide https://learn.microsoft.com/ru-ru/powershell/scripting/gallery/how-to/working-with-packages/manual-download?view=powershell-7.1

Answer 2

After digging a lot, the problem set migrated to a more specific set of issues related to updates in the powershell package and package management sphere.

This thread describes the more specific problem, and has steps that led to the resolution.