diff --git a/src/System.Management.Automation/engine/Modules/ModuleIntrinsics.cs b/src/System.Management.Automation/engine/Modules/ModuleIntrinsics.cs
index b782b390177..8e008dc0ef2 100644
--- a/src/System.Management.Automation/engine/Modules/ModuleIntrinsics.cs
+++ b/src/System.Management.Automation/engine/Modules/ModuleIntrinsics.cs
@@ -910,7 +910,15 @@ public static string GetModulePath(string currentProcessModulePath, string hklmM
                 string systemModulePathToUse = string.IsNullOrEmpty(hklmMachineModulePath) ? psHomeModulePath : hklmMachineModulePath;
 
                 currentProcessModulePath = AddToPath(currentProcessModulePath, personalModulePathToUse, 0);
-                currentProcessModulePath = AddToPath(currentProcessModulePath, systemModulePathToUse, -1);
+
+                int insertIndex = -1;
+#if !UNIX
+                string windowsPowerShellModulePath = GetWindowsPowerShellPSHomeModulePath();
+                // If the Windows PowerShell Module path is already present, insert the system module path
+                // ($PSHOME/Modules) before it.
+                insertIndex = PathContainsSubstring(currentProcessModulePath, windowsPowerShellModulePath);
+#endif                
+                currentProcessModulePath = AddToPath(currentProcessModulePath, systemModulePathToUse, insertIndex);
             }
 
             // if we reached this point - always add <Program Files> location to EVT.Process
@@ -918,6 +926,7 @@ public static string GetModulePath(string currentProcessModulePath, string hklmM
 
             // index of $PSHome\Modules in currentProcessModulePath
             int indexOfPSHomeModulePath = PathContainsSubstring(currentProcessModulePath, psHomeModulePath);
+            
             // if $PSHome\Modules not found (psHomePosition == -1) - append <Program Files> location to the end;
             // if $PSHome\Modules IS found (psHomePosition >= 0) - insert <Program Files> location before $PSHome\Modules
             currentProcessModulePath = AddToPath(currentProcessModulePath, sharedModulePath, indexOfPSHomeModulePath);
diff --git a/test/powershell/engine/Module/ModulePath.Tests.ps1 b/test/powershell/engine/Module/ModulePath.Tests.ps1
index 19e78354dc4..11f628f66e9 100644
--- a/test/powershell/engine/Module/ModulePath.Tests.ps1
+++ b/test/powershell/engine/Module/ModulePath.Tests.ps1
@@ -130,4 +130,33 @@ Describe "SxS Module Path Basic Tests" -tags "CI" {
         $paths -contains $customeModules | Should -BeTrue
     }
 
+    It 'Ensures $PSHOME\Modules is inserted correctly when launched from a different version of PowerShell' -Skip:(!($IsCoreCLR -and $IsWindows)) {
+        # When launched from a different version of PowerShell, PSModulePath contains the other version's PSHOME\Modules path
+        # and the Windows PowerShell modoule path. THe other version's module path should be removed and this version's
+        # PSHOME\Modules path should be inserted before Windows PowerShell module path.
+        $winpwshModulePath = [System.IO.Path]::Combine([System.Environment]::SystemDirectory, "WindowsPowerShell", "v1.0", "Modules");
+        $pwshModulePath = Join-Path -Path $PSHOME -ChildPath 'Modules'
+
+        # create a fake 'other version' $PSHOME and $PSHOME\Modules
+        $fakeHome = Join-Path -Path $TestDrive -ChildPath 'fakepwsh'
+        $fakeModulePath = Join-Path -Path $fakeHome -ChildPath 'Modules'
+
+        $null = New-Item -Path $fakeHome -ItemType Directory
+        $null = New-Item -Path $fakeModulePath -ItemType Directory
+
+        # powershell looks for these to files to determine the directory is a pwsh directory.
+        Set-Content -Path "$fakeHome\pwsh.exe" -Value "fake pwsh.exe"
+        Set-Content -Path "$fakeHome\pwsh.deps.json" -Value 'fake pwsh.deps.json'
+
+        # replace the actual pwsh module path with the fake one.
+        $fakeModulePath = $env:PSModulePath.Replace($pwshModulePath, $fakeModulePath, [StringComparison]::OrdinalIgnoreCase)
+
+        $newModulePath = & $powershell -nopro -c '$env:PSModulePath'
+        $pwshIndex = $newModulePath.IndexOf($pwshModulePath, [StringComparison]::OrdinalIgnoreCase)
+        $wpshIndex = $newModulePath.IndexOf($winpwshModulePath, [StringComparison]::OrdinalIgnoreCase)
+        # ensure both module paths exist and the pwsh module path occurs before the Windows PowerShell module path
+        $pwshIndex | Should -Not -Be -1
+        $wpshIndex | Should -Not -Be -1
+        $pwshIndex | Should -BeLessThan $wpshIndex
+    }
 }