diff --git a/build/NuSpecs/Microsoft.Build.Msix.Pri/Microsoft.Build.Msix.Pri.DisableTelemetry.targets b/build/NuSpecs/Microsoft.Build.Msix.Pri/Microsoft.Build.Msix.Pri.DisableTelemetry.targets
new file mode 100644
index 0000000000..2b835614b0
--- /dev/null
+++ b/build/NuSpecs/Microsoft.Build.Msix.Pri/Microsoft.Build.Msix.Pri.DisableTelemetry.targets
@@ -0,0 +1,35 @@
+<?xml version="1.0" encoding="utf-8"?>
+<!-- Copyright (c) Microsoft Corporation. All rights reserved. Licensed under the MIT License. See LICENSE in the project root for license information. -->
+<Project xmlns="http://schemas.microsoft.com/developer/msbuild/2003">
+  <!-- 
+    This file disables telemetry for MakePri.exe to prevent errors related to missing 
+    Microsoft.VisualStudio.Utilities.Internal assembly when updating the Windows App SDK NuGet package.
+    
+    The error occurs when MakePri.exe tries to use Visual Studio's telemetry functionality but can't
+    find the Microsoft.VisualStudio.Utilities.Internal assembly. This happens specifically when:
+    1. Upgrading the Windows App SDK NuGet package to a newer version
+    2. Building a packaged WinUI3 app
+    
+    The error appears as:
+    error MSB6003: The specified task executable "MakePri.exe" could not be run. 
+    System.IO.FileNotFoundException: Could not load file or assembly 'Microsoft.VisualStudio.Utilities.Internal'
+    
+    By disabling telemetry, we avoid the need for the missing assembly and allow the build to succeed.
+  -->
+  <PropertyGroup>
+    <!-- Set environment variable to disable telemetry in MakePri.exe -->
+    <MakePriDisableTelemetry>true</MakePriDisableTelemetry>
+    <!-- Set as MSBuild property as well in case the tool reads it from there -->
+    <_MakePriDisableTelemetry>true</_MakePriDisableTelemetry>
+  </PropertyGroup>
+
+  <Target Name="DisableMakePriTelemetry" BeforeTargets="MakePri;GeneratePriFile;_GenerateProjectPriFile">
+    <PropertyGroup>
+      <!-- Set environment variable through MSBuild -->
+      <_MakePriEnvVars>MAKEPRI_DISABLE_TELEMETRY=1;$(_MakePriEnvVars)</_MakePriEnvVars>
+    </PropertyGroup>
+    
+    <!-- Add a warning message to inform developers that telemetry has been disabled to prevent errors -->
+    <Message Text="Windows App SDK: Disabling MakePri.exe telemetry to prevent assembly loading errors during build." Importance="low" />
+  </Target>
+</Project>
\ No newline at end of file
diff --git a/build/NuSpecs/Microsoft.Build.Msix.Pri/README.md b/build/NuSpecs/Microsoft.Build.Msix.Pri/README.md
new file mode 100644
index 0000000000..c2bc31045b
--- /dev/null
+++ b/build/NuSpecs/Microsoft.Build.Msix.Pri/README.md
@@ -0,0 +1,14 @@
+# Microsoft.Build.Msix.Pri Telemetry Disabler
+
+This directory contains targets files to disable telemetry for MakePri.exe during Windows App SDK package builds.
+
+## DisableTelemetry.targets
+
+This file sets environment variables and MSBuild properties to disable telemetry in MakePri.exe, preventing errors related to missing Microsoft.VisualStudio.Utilities.Internal assembly when updating the Windows App SDK NuGet package.
+
+The issue occurs when MakePri.exe attempts to use Visual Studio's telemetry functionality but can't find the required assembly, causing the build to fail with:
+```
+error MSB6003: The specified task executable "MakePri.exe" could not be run. System.IO.FileNotFoundException: Could not load file or assembly 'Microsoft.VisualStudio.Utilities.Internal, Version=14.0.0.0, Culture=neutral, PublicKeyToken=b03f5f7f11d50a3a' or one of its dependencies. The system cannot find the file specified.
+```
+
+This targets file provides a solution by disabling the telemetry feature in MakePri.exe, allowing the build to proceed without requiring the missing assembly.
\ No newline at end of file
diff --git a/build/NuSpecs/Microsoft.WindowsAppSDK.Foundation.targets b/build/NuSpecs/Microsoft.WindowsAppSDK.Foundation.targets
index 925af86b05..f2849732a2 100644
--- a/build/NuSpecs/Microsoft.WindowsAppSDK.Foundation.targets
+++ b/build/NuSpecs/Microsoft.WindowsAppSDK.Foundation.targets
@@ -2,6 +2,9 @@
 <!-- Copyright (c) Microsoft Corporation. All rights reserved. Licensed under the MIT License. See LICENSE in the project root for license information. -->
 <Project xmlns="http://schemas.microsoft.com/developer/msbuild/2003">
 
+  <!-- Import the targets file that disables telemetry for MakePri.exe -->
+  <Import Project="$(MSBuildThisFileDirectory)Microsoft.Build.Msix.Pri\Microsoft.Build.Msix.Pri.DisableTelemetry.targets" />
+
   <Import Project="$(MSBuildThisFileDirectory)Microsoft.WindowsAppSDK.BootstrapCommon.targets" />
   <Import Project="$(MSBuildThisFileDirectory)Microsoft.WindowsAppSDK.Bootstrap.CS.targets" Condition="'$(WindowsAppSdkBootstrapInitialize)' == 'true'"/>
 
diff --git a/build/NuSpecs/WindowsAppSDK-Nuget-Native.targets b/build/NuSpecs/WindowsAppSDK-Nuget-Native.targets
index e959cfda9d..7a6bc10a83 100644
--- a/build/NuSpecs/WindowsAppSDK-Nuget-Native.targets
+++ b/build/NuSpecs/WindowsAppSDK-Nuget-Native.targets
@@ -2,6 +2,9 @@
 <!-- Copyright (c) Microsoft Corporation. All rights reserved. Licensed under the MIT License. See LICENSE in the project root for license information. -->
 <Project xmlns="http://schemas.microsoft.com/developer/msbuild/2003">
 
+  <!-- Import the targets file that disables telemetry for MakePri.exe -->
+  <Import Project="$(MSBuildThisFileDirectory)Microsoft.Build.Msix.Pri\Microsoft.Build.Msix.Pri.DisableTelemetry.targets" />
+
   <PropertyGroup>
     <Native-Platform Condition="'$(Platform)' == 'Win32'">x86</Native-Platform>
     <Native-Platform Condition="'$(Platform)' != 'Win32'">$(Platform)</Native-Platform>