diff --git a/__tests__/cache-restore.test.ts b/__tests__/cache-restore.test.ts
index 59135452c..b7bd5f152 100644
--- a/__tests__/cache-restore.test.ts
+++ b/__tests__/cache-restore.test.ts
@@ -45,6 +45,7 @@ describe('cache-restore', () => {
     }
   }
 
+  let inputs = {} as any;
   let saveStateSpy: jest.SpyInstance;
   let infoSpy: jest.SpyInstance;
   let debugSpy: jest.SpyInstance;
@@ -52,6 +53,7 @@ describe('cache-restore', () => {
   let getCommandOutputSpy: jest.SpyInstance;
   let restoreCacheSpy: jest.SpyInstance;
   let hashFilesSpy: jest.SpyInstance;
+  let inSpy: jest.SpyInstance;
 
   beforeEach(() => {
     // core
@@ -67,6 +69,10 @@ describe('cache-restore', () => {
     saveStateSpy = jest.spyOn(core, 'saveState');
     saveStateSpy.mockImplementation(() => undefined);
 
+    inputs = {};
+    inSpy = jest.spyOn(core, 'getInput');
+    inSpy.mockImplementation(name => inputs[name]);
+
     // glob
     hashFilesSpy = jest.spyOn(glob, 'hashFiles');
     hashFilesSpy.mockImplementation((pattern: string) => {
@@ -131,11 +137,12 @@ describe('cache-restore', () => {
             return findCacheFolder(command);
           }
         });
+        inputs['node-version'] = 'vABC';
 
         await restoreCache(packageManager);
         expect(hashFilesSpy).toHaveBeenCalled();
         expect(infoSpy).toHaveBeenCalledWith(
-          `Cache restored from key: node-cache-${platform}-${packageManager}-v2-${fileHash}`
+          `Cache restored from key: node-cache-${platform}-${packageManager}-v2-vABC-${fileHash}`
         );
         expect(infoSpy).not.toHaveBeenCalledWith(
           `${packageManager} cache is not found`
diff --git a/dist/cache-save/index.js b/dist/cache-save/index.js
index aad770848..f682d7d89 100644
--- a/dist/cache-save/index.js
+++ b/dist/cache-save/index.js
@@ -59248,7 +59248,7 @@ var __importDefault = (this && this.__importDefault) || function (mod) {
     return (mod && mod.__esModule) ? mod : { "default": mod };
 };
 Object.defineProperty(exports, "__esModule", ({ value: true }));
-exports.isCacheFeatureAvailable = exports.isGhes = exports.getCacheDirectoryPath = exports.getPackageManagerInfo = exports.getPackageManagerVersion = exports.getPackageManagerCommandOutput = exports.getPackageManagerWorkingDir = exports.getCommandOutput = exports.supportedPackageManagers = void 0;
+exports.isYarn3OfflineCache = exports.isCacheFeatureAvailable = exports.isGhes = exports.getCacheDirectoryPath = exports.getPackageManagerInfo = exports.getPackageManagerVersion = exports.getPackageManagerCommandOutput = exports.getPackageManagerWorkingDir = exports.getCommandOutput = exports.supportedPackageManagers = void 0;
 const core = __importStar(__nccwpck_require__(2186));
 const exec = __importStar(__nccwpck_require__(1514));
 const cache = __importStar(__nccwpck_require__(7799));
@@ -59356,6 +59356,30 @@ function isCacheFeatureAvailable() {
     return false;
 }
 exports.isCacheFeatureAvailable = isCacheFeatureAvailable;
+// a hack for further possible compatibility issues and a syntax sugar
+const getYarn3ProjectDirectoryPath = () => exports.getCacheDirectoryPath(exports.supportedPackageManagers.yarn2, 'yarn');
+// see https://yarnpkg.com/features/offline-cache
+let isYarn3OfflineCacheMemoized = null;
+const isYarn3OfflineCache = (packageManagerInfo) => __awaiter(void 0, void 0, void 0, function* () {
+    if (isYarn3OfflineCacheMemoized !== null)
+        return isYarn3OfflineCacheMemoized;
+    isYarn3OfflineCacheMemoized = false;
+    if (packageManagerInfo !== exports.supportedPackageManagers.yarn2)
+        return isYarn3OfflineCacheMemoized;
+    const yarnDir = yield getYarn3ProjectDirectoryPath();
+    const workDir = yarnDir || process.env.GITHUB_WORKSPACE;
+    const yarnCacheFile = path_1.default.join(workDir, '.yarn', 'cache');
+    if (fs_1.default.existsSync(yarnCacheFile) && fs_1.default.lstatSync(yarnCacheFile).isDirectory())
+        return isYarn3OfflineCacheMemoized;
+    const yarnRcPath = path_1.default.join(workDir, '.yarnrc.yml');
+    if (!(fs_1.default.existsSync(yarnRcPath) && fs_1.default.lstatSync(yarnRcPath).isFile()))
+        return isYarn3OfflineCacheMemoized;
+    const yarnRc = fs_1.default.readFileSync(path_1.default.join(workDir, '.yarnrc.yml')).toString();
+    const globalCache = yarnRc.match(/^enableGlobalCache:\s*true/m);
+    isYarn3OfflineCacheMemoized = !globalCache;
+    return isYarn3OfflineCacheMemoized;
+});
+exports.isYarn3OfflineCache = isYarn3OfflineCache;
 
 
 /***/ }),
diff --git a/dist/setup/index.js b/dist/setup/index.js
index eae17a848..d2878728e 100644
--- a/dist/setup/index.js
+++ b/dist/setup/index.js
@@ -71138,12 +71138,14 @@ const path_1 = __importDefault(__nccwpck_require__(1017));
 const fs_1 = __importDefault(__nccwpck_require__(7147));
 const constants_1 = __nccwpck_require__(9042);
 const cache_utils_1 = __nccwpck_require__(1678);
+const util_1 = __nccwpck_require__(2629);
 const restoreCache = (packageManager, cacheDependencyPath) => __awaiter(void 0, void 0, void 0, function* () {
     const packageManagerInfo = yield cache_utils_1.getPackageManagerInfo(packageManager);
     if (!packageManagerInfo) {
         throw new Error(`Caching for '${packageManager}' is not supported`);
     }
     const platform = process.env.RUNNER_OS;
+    const nodeVersion = util_1.resolveVersionInput();
     const cachePath = yield cache_utils_1.getCacheDirectoryPath(packageManagerInfo, packageManager);
     const lockFilePath = cacheDependencyPath
         ? cacheDependencyPath
@@ -71152,10 +71154,13 @@ const restoreCache = (packageManager, cacheDependencyPath) => __awaiter(void 0,
     if (!fileHash) {
         throw new Error('Some specified paths were not resolved, unable to cache dependencies.');
     }
-    const primaryKey = `node-cache-${platform}-${packageManager}-v2-${fileHash}`;
+    const keyPrefix = `node-cache-${platform}-${packageManager}-v2-${nodeVersion}`;
+    const primaryKey = `${keyPrefix}-${fileHash}`;
     core.debug(`primary key is ${primaryKey}`);
     core.saveState(constants_1.State.CachePrimaryKey, primaryKey);
-    const cacheKey = yield cache.restoreCache([cachePath], primaryKey);
+    const cacheKey = (yield cache_utils_1.isYarn3OfflineCache(packageManagerInfo))
+        ? yield cache.restoreCache([cachePath], primaryKey, [keyPrefix])
+        : yield cache.restoreCache([cachePath], primaryKey);
     core.setOutput('cache-hit', Boolean(cacheKey));
     if (!cacheKey) {
         core.info(`${packageManager} cache is not found`);
@@ -71216,7 +71221,7 @@ var __importDefault = (this && this.__importDefault) || function (mod) {
     return (mod && mod.__esModule) ? mod : { "default": mod };
 };
 Object.defineProperty(exports, "__esModule", ({ value: true }));
-exports.isCacheFeatureAvailable = exports.isGhes = exports.getCacheDirectoryPath = exports.getPackageManagerInfo = exports.getPackageManagerVersion = exports.getPackageManagerCommandOutput = exports.getPackageManagerWorkingDir = exports.getCommandOutput = exports.supportedPackageManagers = void 0;
+exports.isYarn3OfflineCache = exports.isCacheFeatureAvailable = exports.isGhes = exports.getCacheDirectoryPath = exports.getPackageManagerInfo = exports.getPackageManagerVersion = exports.getPackageManagerCommandOutput = exports.getPackageManagerWorkingDir = exports.getCommandOutput = exports.supportedPackageManagers = void 0;
 const core = __importStar(__nccwpck_require__(2186));
 const exec = __importStar(__nccwpck_require__(1514));
 const cache = __importStar(__nccwpck_require__(7799));
@@ -71324,6 +71329,30 @@ function isCacheFeatureAvailable() {
     return false;
 }
 exports.isCacheFeatureAvailable = isCacheFeatureAvailable;
+// a hack for further possible compatibility issues and a syntax sugar
+const getYarn3ProjectDirectoryPath = () => exports.getCacheDirectoryPath(exports.supportedPackageManagers.yarn2, 'yarn');
+// see https://yarnpkg.com/features/offline-cache
+let isYarn3OfflineCacheMemoized = null;
+const isYarn3OfflineCache = (packageManagerInfo) => __awaiter(void 0, void 0, void 0, function* () {
+    if (isYarn3OfflineCacheMemoized !== null)
+        return isYarn3OfflineCacheMemoized;
+    isYarn3OfflineCacheMemoized = false;
+    if (packageManagerInfo !== exports.supportedPackageManagers.yarn2)
+        return isYarn3OfflineCacheMemoized;
+    const yarnDir = yield getYarn3ProjectDirectoryPath();
+    const workDir = yarnDir || process.env.GITHUB_WORKSPACE;
+    const yarnCacheFile = path_1.default.join(workDir, '.yarn', 'cache');
+    if (fs_1.default.existsSync(yarnCacheFile) && fs_1.default.lstatSync(yarnCacheFile).isDirectory())
+        return isYarn3OfflineCacheMemoized;
+    const yarnRcPath = path_1.default.join(workDir, '.yarnrc.yml');
+    if (!(fs_1.default.existsSync(yarnRcPath) && fs_1.default.lstatSync(yarnRcPath).isFile()))
+        return isYarn3OfflineCacheMemoized;
+    const yarnRc = fs_1.default.readFileSync(path_1.default.join(workDir, '.yarnrc.yml')).toString();
+    const globalCache = yarnRc.match(/^enableGlobalCache:\s*true/m);
+    isYarn3OfflineCacheMemoized = !globalCache;
+    return isYarn3OfflineCacheMemoized;
+});
+exports.isYarn3OfflineCache = isYarn3OfflineCache;
 
 
 /***/ }),
@@ -72064,7 +72093,6 @@ var __importDefault = (this && this.__importDefault) || function (mod) {
 Object.defineProperty(exports, "__esModule", ({ value: true }));
 exports.run = void 0;
 const core = __importStar(__nccwpck_require__(2186));
-const fs_1 = __importDefault(__nccwpck_require__(7147));
 const os_1 = __importDefault(__nccwpck_require__(2037));
 const auth = __importStar(__nccwpck_require__(7573));
 const path = __importStar(__nccwpck_require__(1017));
@@ -72079,7 +72107,7 @@ function run() {
             // Version is optional.  If supplied, install / use from the tool cache
             // If not supplied then task is still used to setup proxy, auth, etc...
             //
-            const version = resolveVersionInput();
+            const version = util_1.resolveVersionInput();
             let arch = core.getInput('architecture');
             const cache = core.getInput('cache');
             // if architecture supplied but node-version is not
@@ -72126,25 +72154,6 @@ function run() {
     });
 }
 exports.run = run;
-function resolveVersionInput() {
-    let version = core.getInput('node-version');
-    const versionFileInput = core.getInput('node-version-file');
-    if (version && versionFileInput) {
-        core.warning('Both node-version and node-version-file inputs are specified, only node-version will be used');
-    }
-    if (version) {
-        return version;
-    }
-    if (versionFileInput) {
-        const versionFilePath = path.join(process.env.GITHUB_WORKSPACE, versionFileInput);
-        if (!fs_1.default.existsSync(versionFilePath)) {
-            throw new Error(`The specified node version file at: ${versionFilePath} does not exist`);
-        }
-        version = util_1.parseNodeVersionFile(fs_1.default.readFileSync(versionFilePath, 'utf8'));
-        core.info(`Resolved ${versionFileInput} as ${version}`);
-    }
-    return version;
-}
 
 
 /***/ }),
@@ -72182,10 +72191,15 @@ var __awaiter = (this && this.__awaiter) || function (thisArg, _arguments, P, ge
         step((generator = generator.apply(thisArg, _arguments || [])).next());
     });
 };
+var __importDefault = (this && this.__importDefault) || function (mod) {
+    return (mod && mod.__esModule) ? mod : { "default": mod };
+};
 Object.defineProperty(exports, "__esModule", ({ value: true }));
-exports.printEnvDetailsAndSetOutput = exports.parseNodeVersionFile = void 0;
+exports.resolveVersionInput = exports.printEnvDetailsAndSetOutput = exports.parseNodeVersionFile = void 0;
 const core = __importStar(__nccwpck_require__(2186));
 const exec = __importStar(__nccwpck_require__(1514));
+const path_1 = __importDefault(__nccwpck_require__(1017));
+const fs_1 = __importDefault(__nccwpck_require__(7147));
 function parseNodeVersionFile(contents) {
     var _a, _b, _c;
     let nodeVersion;
@@ -72245,6 +72259,31 @@ function getToolVersion(tool, options) {
         }
     });
 }
+let resolvedVersionInputMemoized = null;
+function resolveVersionInput() {
+    if (resolvedVersionInputMemoized !== null)
+        return resolvedVersionInputMemoized;
+    let version = core.getInput('node-version');
+    const versionFileInput = core.getInput('node-version-file');
+    if (version && versionFileInput) {
+        core.warning('Both node-version and node-version-file inputs are specified, only node-version will be used');
+    }
+    if (version) {
+        resolvedVersionInputMemoized = version;
+        return version;
+    }
+    if (versionFileInput) {
+        const versionFilePath = path_1.default.join(process.env.GITHUB_WORKSPACE, versionFileInput);
+        if (!fs_1.default.existsSync(versionFilePath)) {
+            throw new Error(`The specified node version file at: ${versionFilePath} does not exist`);
+        }
+        version = parseNodeVersionFile(fs_1.default.readFileSync(versionFilePath, 'utf8'));
+        core.info(`Resolved ${versionFileInput} as ${version}`);
+    }
+    resolvedVersionInputMemoized = version;
+    return version;
+}
+exports.resolveVersionInput = resolveVersionInput;
 
 
 /***/ }),
diff --git a/src/cache-restore.ts b/src/cache-restore.ts
index 0341c109f..fbb285b5e 100644
--- a/src/cache-restore.ts
+++ b/src/cache-restore.ts
@@ -8,8 +8,10 @@ import {State} from './constants';
 import {
   getCacheDirectoryPath,
   getPackageManagerInfo,
+  isYarn3OfflineCache,
   PackageManagerInfo
 } from './cache-utils';
+import {resolveVersionInput} from './util';
 
 export const restoreCache = async (
   packageManager: string,
@@ -20,6 +22,7 @@ export const restoreCache = async (
     throw new Error(`Caching for '${packageManager}' is not supported`);
   }
   const platform = process.env.RUNNER_OS;
+  const nodeVersion = resolveVersionInput();
 
   const cachePath = await getCacheDirectoryPath(
     packageManagerInfo,
@@ -36,12 +39,16 @@ export const restoreCache = async (
     );
   }
 
-  const primaryKey = `node-cache-${platform}-${packageManager}-v2-${fileHash}`;
+  const keyPrefix = `node-cache-${platform}-${packageManager}-v2-${nodeVersion}`;
+  const primaryKey = `${keyPrefix}-${fileHash}`;
   core.debug(`primary key is ${primaryKey}`);
 
   core.saveState(State.CachePrimaryKey, primaryKey);
 
-  const cacheKey = await cache.restoreCache([cachePath], primaryKey);
+  const cacheKey = (await isYarn3OfflineCache(packageManagerInfo))
+    ? await cache.restoreCache([cachePath], primaryKey, [keyPrefix])
+    : await cache.restoreCache([cachePath], primaryKey);
+
   core.setOutput('cache-hit', Boolean(cacheKey));
 
   if (!cacheKey) {
diff --git a/src/cache-utils.ts b/src/cache-utils.ts
index ebd5144b1..c9a646487 100644
--- a/src/cache-utils.ts
+++ b/src/cache-utils.ts
@@ -150,3 +150,38 @@ export function isCacheFeatureAvailable(): boolean {
 
   return false;
 }
+
+// a hack for further possible compatibility issues and a syntax sugar
+const getYarn3ProjectDirectoryPath = () =>
+  getCacheDirectoryPath(supportedPackageManagers.yarn2, 'yarn');
+
+// see https://yarnpkg.com/features/offline-cache
+let isYarn3OfflineCacheMemoized: boolean | null = null;
+export const isYarn3OfflineCache = async (
+  packageManagerInfo: PackageManagerInfo
+): Promise<boolean> => {
+  if (isYarn3OfflineCacheMemoized !== null) return isYarn3OfflineCacheMemoized;
+
+  isYarn3OfflineCacheMemoized = false;
+
+  if (packageManagerInfo !== supportedPackageManagers.yarn2)
+    return isYarn3OfflineCacheMemoized;
+
+  const yarnDir = await getYarn3ProjectDirectoryPath();
+
+  const workDir = yarnDir || process.env.GITHUB_WORKSPACE!;
+
+  const yarnCacheFile = path.join(workDir, '.yarn', 'cache');
+  if (fs.existsSync(yarnCacheFile) && fs.lstatSync(yarnCacheFile).isDirectory())
+    return isYarn3OfflineCacheMemoized;
+
+  const yarnRcPath = path.join(workDir, '.yarnrc.yml');
+  if (!(fs.existsSync(yarnRcPath) && fs.lstatSync(yarnRcPath).isFile()))
+    return isYarn3OfflineCacheMemoized;
+
+  const yarnRc = fs.readFileSync(path.join(workDir, '.yarnrc.yml')).toString();
+  const globalCache = yarnRc.match(/^enableGlobalCache:\s*true/m);
+
+  isYarn3OfflineCacheMemoized = !globalCache;
+  return isYarn3OfflineCacheMemoized;
+};
diff --git a/src/main.ts b/src/main.ts
index 90cd1d9d9..49c57011a 100644
--- a/src/main.ts
+++ b/src/main.ts
@@ -8,7 +8,11 @@ import * as path from 'path';
 import {restoreCache} from './cache-restore';
 import {isCacheFeatureAvailable} from './cache-utils';
 import {getNodejsDistribution} from './distributions/installer-factory';
-import {parseNodeVersionFile, printEnvDetailsAndSetOutput} from './util';
+import {
+  parseNodeVersionFile,
+  printEnvDetailsAndSetOutput,
+  resolveVersionInput
+} from './util';
 
 export async function run() {
   try {
@@ -76,37 +80,3 @@ export async function run() {
     core.setFailed(err.message);
   }
 }
-
-function resolveVersionInput(): string {
-  let version = core.getInput('node-version');
-  const versionFileInput = core.getInput('node-version-file');
-
-  if (version && versionFileInput) {
-    core.warning(
-      'Both node-version and node-version-file inputs are specified, only node-version will be used'
-    );
-  }
-
-  if (version) {
-    return version;
-  }
-
-  if (versionFileInput) {
-    const versionFilePath = path.join(
-      process.env.GITHUB_WORKSPACE!,
-      versionFileInput
-    );
-
-    if (!fs.existsSync(versionFilePath)) {
-      throw new Error(
-        `The specified node version file at: ${versionFilePath} does not exist`
-      );
-    }
-
-    version = parseNodeVersionFile(fs.readFileSync(versionFilePath, 'utf8'));
-
-    core.info(`Resolved ${versionFileInput} as ${version}`);
-  }
-
-  return version;
-}
diff --git a/src/util.ts b/src/util.ts
index 60f2649c2..253edd5fb 100644
--- a/src/util.ts
+++ b/src/util.ts
@@ -1,5 +1,7 @@
 import * as core from '@actions/core';
 import * as exec from '@actions/exec';
+import path from 'path';
+import fs from 'fs';
 
 export function parseNodeVersionFile(contents: string): string {
   let nodeVersion: string | undefined;
@@ -61,3 +63,43 @@ async function getToolVersion(tool: string, options: string[]) {
     return '';
   }
 }
+
+let resolvedVersionInputMemoized: string | null = null;
+export function resolveVersionInput(): string {
+  if (resolvedVersionInputMemoized !== null)
+    return resolvedVersionInputMemoized;
+
+  let version = core.getInput('node-version');
+  const versionFileInput = core.getInput('node-version-file');
+
+  if (version && versionFileInput) {
+    core.warning(
+      'Both node-version and node-version-file inputs are specified, only node-version will be used'
+    );
+  }
+
+  if (version) {
+    resolvedVersionInputMemoized = version;
+    return version;
+  }
+
+  if (versionFileInput) {
+    const versionFilePath = path.join(
+      process.env.GITHUB_WORKSPACE!,
+      versionFileInput
+    );
+
+    if (!fs.existsSync(versionFilePath)) {
+      throw new Error(
+        `The specified node version file at: ${versionFilePath} does not exist`
+      );
+    }
+
+    version = parseNodeVersionFile(fs.readFileSync(versionFilePath, 'utf8'));
+
+    core.info(`Resolved ${versionFileInput} as ${version}`);
+  }
+
+  resolvedVersionInputMemoized = version;
+  return version;
+}