diff --git a/libs/rtemodel/src/RteKernel.cpp b/libs/rtemodel/src/RteKernel.cpp
index b853725ea..6543ce2cb 100644
--- a/libs/rtemodel/src/RteKernel.cpp
+++ b/libs/rtemodel/src/RteKernel.cpp
@@ -326,8 +326,7 @@ string RteKernel::GetLocalPdscFile(const RteAttributes& attributes, const string
   string url, version;
   if (GetUrlFromIndex(rtePath, name, vendor, versionRange, url, version)) {
     packId = vendor + '.' + name + '.' + version;
-    url = RteFsUtils::GetAbsPathFromLocalUrl(url);
-    return url + vendor + '.' + name + ".pdsc";
+    return url;
   }
 
   return RteUtils::EMPTY_STRING;
@@ -368,9 +367,17 @@ bool RteKernel::GetUrlFromIndex(const string& rtePath, const string& name, const
   // Populate map with items matching name, vendor and version range
   for (const auto& item : indexList) {
     if ((name == item->GetAttribute("name")) && (vendor == item->GetAttribute("vendor"))) {
-      const string& version = item->GetAttribute("version");
-      if (versionRange.empty() || VersionCmp::RangeCompare(version, versionRange) == 0) {
-        pdscMap[version] = item->GetAttribute("url");
+      // Load the local pack to get its version. The 'version' attribute in the local repository index is ignored.
+      list<string> localPdscFiles;
+      RteFsUtils::GetPackageDescriptionFiles(localPdscFiles, RteFsUtils::GetAbsPathFromLocalUrl(item->GetAttribute("url")), 1);
+      for (const auto& localPdscFile : localPdscFiles) {
+        RtePackage* pack = LoadPack(localPdscFile);
+        if (pack) {
+          const string& version = pack->GetVersionString();
+          if (versionRange.empty() || VersionCmp::RangeCompare(version, versionRange) == 0) {
+            pdscMap[version] = localPdscFile;
+          }
+        }
       }
     }
   }
diff --git a/libs/rtemodel/test/src/RteModelTest.cpp b/libs/rtemodel/test/src/RteModelTest.cpp
index e814e14bb..d0aff0933 100644
--- a/libs/rtemodel/test/src/RteModelTest.cpp
+++ b/libs/rtemodel/test/src/RteModelTest.cpp
@@ -61,6 +61,7 @@ TEST(RteModelTest, LoadPacks) {
 
 // define project and header file names with relative paths
 const string prjsDir = "RteModelTestProjects";
+const string localRepoDir = "RteModelLocalRepo";
 const string RteTestM3 = "/RteTestM3";
 const string RteTestM3_cprj = prjsDir + RteTestM3 + "/RteTestM3.cprj";
 const string RteTestM3_ConfigFolder_cprj = prjsDir + RteTestM3 + "/RteTestM3_ConfigFolder.cprj";
@@ -84,6 +85,7 @@ class RteModelPrjTest :public ::testing::Test {
   {
     RteFsUtils::DeleteTree(prjsDir);
     RteFsUtils::CopyTree(RteModelTestConfig::PROJECTS_DIR, prjsDir);
+    RteFsUtils::CopyTree(RteModelTestConfig::LOCAL_REPO_DIR, localRepoDir);
   }
 
   void TearDown() override
@@ -94,6 +96,30 @@ class RteModelPrjTest :public ::testing::Test {
   void compareFile(const string &newFile, const string &refFile,
     const std::unordered_map<string, string> &expectedChangedFlags, const string &toolchain) const;
 
+  string UpdateLocalIndex() {
+    const string index = localRepoDir + "/.Local/local_repository.pidx";
+    const string pdsc = RteModelTestConfig::CMSIS_PACK_ROOT + "/ARM/RteTest/0.1.0/ARM.RteTest.pdsc";
+    const string original = "file://localhost/packs/LocalVendor/LocalPack/";
+    const string replace = "file://localhost/" + RteModelTestConfig::CMSIS_PACK_ROOT + "/ARM/RteTest/0.1.0/";
+    string line;
+    vector<string> buffer;
+
+    ifstream in(index);
+    while (getline(in, line)) {
+      size_t pos = line.find(original);
+      if (pos != string::npos) {
+        line.replace(pos, original.length(), replace);
+      }
+      buffer.push_back(line);
+    }
+    in.close();
+
+    ofstream out(index);
+    for (vector<string>::iterator it = buffer.begin(); it != buffer.end(); it++) {
+      out << *it << endl;
+    }
+    return pdsc;
+  }
 
   void GenerateHeadersTest(const string& project, const string& rteFolder) {
 
@@ -278,27 +304,21 @@ TEST_F(RteModelPrjTest, LoadCprjConfigVer) {
 
 TEST_F(RteModelPrjTest, GetLocalPdscFile) {
   RteKernelSlim rteKernel;
-  const string& packRoot = RteModelTestConfig::CMSIS_PACK_ROOT + "/../local";
+  const string& expectedPdsc = UpdateLocalIndex();
 
   RteAttributes attributes;
   attributes.AddAttribute("name", "LocalPack");
   attributes.AddAttribute("vendor", "LocalVendor");
   attributes.AddAttribute("version", "0.1.0");
   string packId;
-  string pdsc = rteKernel.GetLocalPdscFile(attributes, packRoot, packId);
+  string pdsc = rteKernel.GetLocalPdscFile(attributes, localRepoDir, packId);
 
   // check returned packId
   EXPECT_EQ(packId, "LocalVendor.LocalPack.0.1.0");
 
   // check returned pdsc
   error_code ec;
-#ifdef _WIN32
-  const string&& expectedPdsc = "packs/LocalVendor/LocalPack/LocalVendor.LocalPack.pdsc";
-  EXPECT_EQ(pdsc, expectedPdsc);
-#else
-  const string&& expectedPdsc = "/packs/LocalVendor/LocalPack/LocalVendor.LocalPack.pdsc";
-  EXPECT_EQ(pdsc, expectedPdsc);
-#endif
+  EXPECT_TRUE(fs::equivalent(pdsc, expectedPdsc, ec));
 }
 
 TEST_F(RteModelPrjTest, GenerateHeadersTestDefault)
diff --git a/libs/rtemodel/test/src/RteModelTestConfig.cpp b/libs/rtemodel/test/src/RteModelTestConfig.cpp
index 088e204c7..3491872e7 100644
--- a/libs/rtemodel/test/src/RteModelTestConfig.cpp
+++ b/libs/rtemodel/test/src/RteModelTestConfig.cpp
@@ -6,6 +6,7 @@
 #include "RteModelTestConfig.h"
 
 const std::string RteModelTestConfig::CMSIS_PACK_ROOT = std::string(GLOBAL_TEST_DIR) + std::string("/packs");
+const std::string RteModelTestConfig::LOCAL_REPO_DIR = std::string(GLOBAL_TEST_DIR) + std::string("/local");
 const std::string RteModelTestConfig::PROJECTS_DIR = std::string(GLOBAL_TEST_DIR) + std::string("/projects");
 const std::string RteModelTestConfig::M3_CPRJ = PROJECTS_DIR + std::string("/RteTestM3/RteTestM3.cprj");
 
diff --git a/libs/rtemodel/test/src/RteModelTestConfig.h b/libs/rtemodel/test/src/RteModelTestConfig.h
index 94e79e332..852f74201 100644
--- a/libs/rtemodel/test/src/RteModelTestConfig.h
+++ b/libs/rtemodel/test/src/RteModelTestConfig.h
@@ -23,6 +23,7 @@ class RteModelTestConfig
 
 public:
   static const std::string CMSIS_PACK_ROOT;
+  static const std::string LOCAL_REPO_DIR;
   static const std::string PROJECTS_DIR;
   static const std::string M3_CPRJ;
 };