diff --git a/Documentation/ArcadeSdk.md b/Documentation/ArcadeSdk.md
index 8ba0154941a..b1743c2f222 100644
--- a/Documentation/ArcadeSdk.md
+++ b/Documentation/ArcadeSdk.md
@@ -596,6 +596,7 @@ Set `VSSDKTargetPlatformRegRootSuffix` property to specify the root suffix of th
 
 If `source.extension.vsixmanifest` is present next to a project file the project is by default considered to be a VSIX producing project (`IsVsixProject` property is set to true). 
 A package reference to `Microsoft.VSSDK.BuildTools` is automatically added to such project. 
+Set `IncludeMicrosoftVSSDKBuildToolsPackageReference` to `false` to opt out of the automatic package reference (e.g. if you need to manage the version yourself).
 
 Arcade SDK include build target for generating VS Template VSIXes. Adding `VSTemplate` items to project will trigger the target.
 
diff --git a/src/Microsoft.DotNet.Arcade.Sdk/tools/DefaultVersions.props b/src/Microsoft.DotNet.Arcade.Sdk/tools/DefaultVersions.props
index c59200dfa5b..890ec61ac79 100644
--- a/src/Microsoft.DotNet.Arcade.Sdk/tools/DefaultVersions.props
+++ b/src/Microsoft.DotNet.Arcade.Sdk/tools/DefaultVersions.props
@@ -67,7 +67,12 @@
     <MicroBuildPluginsSwixBuildVersion Condition="'$(MicroBuildPluginsSwixBuildVersion)' == ''">1.0.422</MicroBuildPluginsSwixBuildVersion>
     <MicrosoftDotNetIBCMergeVersion Condition="'$(MicrosoftDotNetIBCMergeVersion)' == ''">5.1.0-beta.21356.1</MicrosoftDotNetIBCMergeVersion>
     <MicrosoftNETTestSdkVersion Condition="'$(MicrosoftNETTestSdkVersion)' == ''">18.0.1</MicrosoftNETTestSdkVersion>
-    <MicrosoftVSSDKBuildToolsVersion Condition="'$(MicrosoftVSSDKBuildToolsVersion)' == ''">16.9.1050</MicrosoftVSSDKBuildToolsVersion>
+    <!--
+      Note: The property name intentionally does NOT follow the convention of 'MicrosoftVSSDKBuildToolsVersion'
+      because the Microsoft.VSSDK.BuildTools package itself redefines that property to a different value,
+      which causes NuGet restores to go in a loop. See https://github.com/dotnet/arcade/issues/15594.
+    -->
+    <MicrosoftVSSDKBuildToolsDefaultVersion Condition="'$(MicrosoftVSSDKBuildToolsDefaultVersion)' == ''">17.14.2120</MicrosoftVSSDKBuildToolsDefaultVersion>
     <MicrosoftDotnetNuGetRepackTasksVersion Condition="'$(MicrosoftDotnetNuGetRepackTasksVersion)' == ''">$(ArcadeSdkVersion)</MicrosoftDotnetNuGetRepackTasksVersion>
     <MicrosoftDotNetSignToolVersion Condition="'$(MicrosoftDotNetSignToolVersion)' == ''">$(ArcadeSdkVersion)</MicrosoftDotNetSignToolVersion>
     <MicrosoftDotNetTarVersion Condition="'$(MicrosoftDotNetTarVersion)' == ''">$(ArcadeSdkVersion)</MicrosoftDotNetTarVersion>
diff --git a/src/Microsoft.DotNet.Arcade.Sdk/tools/VisualStudio.targets b/src/Microsoft.DotNet.Arcade.Sdk/tools/VisualStudio.targets
index c408c823b3c..ab840aae8ae 100644
--- a/src/Microsoft.DotNet.Arcade.Sdk/tools/VisualStudio.targets
+++ b/src/Microsoft.DotNet.Arcade.Sdk/tools/VisualStudio.targets
@@ -24,8 +24,8 @@
     <PackageReference Include="Microsoft.VisualStudioEng.MicroBuild.Plugins.SwixBuild" Version="$(MicrosoftVisualStudioEngMicroBuildPluginsSwixBuildVersion)" PrivateAssets="all" IsImplicitlyDefined="true" />
   </ItemGroup>
 
-  <ItemGroup Condition="'$(IsVsixProject)' == 'true' or '$(GeneratePkgDefFile)' == 'true'">
-    <PackageReference Include="Microsoft.VSSDK.BuildTools" Version="$(MicrosoftVSSDKBuildToolsVersion)" PrivateAssets="all" IsImplicitlyDefined="true" />
+  <ItemGroup Condition="('$(IsVsixProject)' == 'true' or '$(GeneratePkgDefFile)' == 'true') and '$(IncludeMicrosoftVSSDKBuildToolsPackageReference)' != 'false'">
+    <PackageReference Include="Microsoft.VSSDK.BuildTools" Version="$(MicrosoftVSSDKBuildToolsDefaultVersion)" PrivateAssets="all" IsImplicitlyDefined="true" />
   </ItemGroup>
 
   <!-- Returns the current build version. Used in .vsixmanifests to substitute our build version into them -->