diff --git a/.github/workflows/ci.yml b/.github/workflows/ci.yml
index 217f9fb..3fa14fc 100644
--- a/.github/workflows/ci.yml
+++ b/.github/workflows/ci.yml
@@ -39,4 +39,9 @@ jobs:
       - uses: julia-actions/cache@v3
       - uses: julia-actions/julia-buildpkg@v1
       - uses: julia-actions/julia-runtest@v1
+        env:
+          # Opt into the Pkg-app shim simulation regression test (#106/#124).
+          # Requires a resolved Manifest.toml in $ROOT, so only runs in dev
+          # checkouts — not when JuliaC is exercised as an installed package.
+          JULIAC_TEST_PKG_APP_SHIM_SIM: "1"
 
diff --git a/Project.toml b/Project.toml
index ac3805f..07d339d 100644
--- a/Project.toml
+++ b/Project.toml
@@ -13,6 +13,7 @@ Patchelf_jll = "f2cf89d6-2bfd-5c44-bd2c-068eea195c0c"
 Pkg = "44cfe95a-1eb2-52ea-b672-e2afdf69b78f"
 RelocatableFolders = "05181044-ff0b-4ac5-8273-598c1e38db00"
 StructIO = "53d494c1-5632-5724-8f4c-31dff12d585f"
+TOML = "fa267f1f-6049-4f14-aa54-33bafae1ed76"
 
 [compat]
 LazyArtifacts = "1"
@@ -24,6 +25,7 @@ Patchelf_jll = "0.18"
 Pkg = "1"
 RelocatableFolders = "1"
 StructIO = "0.3"
+TOML = "1"
 julia = "1.10"
 
 [apps.juliac]
diff --git a/src/JuliaC.jl b/src/JuliaC.jl
index 1520fdf..0a2b2fc 100644
--- a/src/JuliaC.jl
+++ b/src/JuliaC.jl
@@ -4,6 +4,7 @@ using Pkg
 using PackageCompiler
 using LazyArtifacts
 using RelocatableFolders
+using TOML
 
 @static if VERSION >= v"1.12.0-rc1"
 
diff --git a/src/compiling.jl b/src/compiling.jl
index ee0cba1..9f1b3f0 100644
--- a/src/compiling.jl
+++ b/src/compiling.jl
@@ -37,6 +37,30 @@ function _start_spinner(message::String; io::IO=stderr)
     return finished, task
 end
 
+"""
+Inject HostCPUFeatures preferences into a project's LocalPreferences.toml
+and ensure the extras section in Project.toml references HostCPUFeatures.
+
+Merges with any existing preferences/extras rather than overwriting.
+"""
+function _inject_trim_preferences(project_dir::String)
+    proj_path = joinpath(project_dir, "Project.toml")
+    proj = isfile(proj_path) ? TOML.parsefile(proj_path) : Dict{String,Any}()
+    extras = get!(Dict{String,Any}, proj, "extras")
+    extras["HostCPUFeatures"] = "3e5b6fbb-0976-4d2c-9146-d79de83f2fb0"
+    open(proj_path, "w") do io
+        TOML.print(io, proj)
+    end
+
+    prefs_path = joinpath(project_dir, "LocalPreferences.toml")
+    prefs = isfile(prefs_path) ? TOML.parsefile(prefs_path) : Dict{String,Any}()
+    hcf = get!(Dict{String,Any}, prefs, "HostCPUFeatures")
+    hcf["freeze_cpu_target"] = true
+    open(prefs_path, "w") do io
+        TOML.print(io, prefs)
+    end
+end
+
 function compile_products(recipe::ImageRecipe)
     # Only strip IR / metadata if not `--trim=no`
     strip_args = String[]
@@ -104,24 +128,16 @@ function compile_products(recipe::ImageRecipe)
     end
     project_arg = isdir(project_arg) ? tmp_project : joinpath(tmp_project, basename(project_arg))
 
-    env_overrides = Dict{String,Any}()
-    tmp_prefs_env = nothing
-    if is_trim_enabled(recipe)
-        load_path_sep = Sys.iswindows() ? ";" : ":"
-        # Create a temporary environment with a LocalPreferences.toml that will be added to JULIA_LOAD_PATH.
-        tmp_prefs_env = mktempdir()
-        open(joinpath(tmp_prefs_env, "Project.toml"), "w") do io
-            println(io, "[extras]")
-            println(io, "HostCPUFeatures = \"3e5b6fbb-0976-4d2c-9146-d79de83f2fb0\"")
-        end
-        # Write LocalPreferences.toml with the trim preferences
-        open(joinpath(tmp_prefs_env, "LocalPreferences.toml"), "w") do io
-            println(io, "[HostCPUFeatures]")
-            println(io, "freeze_cpu_target = true")
-        end
-        # Append the temp env to JULIA_LOAD_PATH
+    # Always clear JULIA_LOAD_PATH to prevent parent environment leakage
+    # (e.g. when JuliaC is invoked as a Pkg app, the shim sets JULIA_LOAD_PATH
+    # to JuliaC's own project, which would break user project compilation — #106/#124).
+    env_overrides = Dict{String,Any}("JULIA_LOAD_PATH" => nothing)
 
-        env_overrides["JULIA_LOAD_PATH"] = load_path_sep * tmp_prefs_env
+    if is_trim_enabled(recipe)
+        # Inject HostCPUFeatures preferences directly into the temp project copy so
+        # the preference is visible without JULIA_LOAD_PATH manipulation.
+        tmp_project_dir = isdir(project_arg) ? project_arg : dirname(project_arg)
+        _inject_trim_preferences(tmp_project_dir)
     end
 
     inst_cmd = addenv(`$(Base.julia_cmd(cpu_target=precompile_cpu_target)) --project=$project_arg -e "using Pkg; Pkg.instantiate(); Pkg.precompile()"`, env_overrides...)
diff --git a/test/DepProject/Project.toml b/test/DepProject/Project.toml
new file mode 100644
index 0000000..9992297
--- /dev/null
+++ b/test/DepProject/Project.toml
@@ -0,0 +1,9 @@
+name = "DepProject"
+uuid = "f47ac10b-58cc-4372-a567-0e02b2c3d479"
+version = "0.1.0"
+
+[deps]
+SHA = "ea8e919c-243c-51af-8825-aaa63cd721ce"
+
+[apps]
+DepProject = {}
diff --git a/test/DepProject/src/DepProject.jl b/test/DepProject/src/DepProject.jl
new file mode 100644
index 0000000..55bc6d1
--- /dev/null
+++ b/test/DepProject/src/DepProject.jl
@@ -0,0 +1,11 @@
+module DepProject
+
+using SHA
+
+function @main(ARGS)
+    h = bytes2hex(sha256("hello"))
+    println(Core.stdout, "sha256: ", h)
+    return 0
+end
+
+end
diff --git a/test/cli.jl b/test/cli.jl
index ce126c1..6ec54fa 100644
--- a/test/cli.jl
+++ b/test/cli.jl
@@ -276,3 +276,70 @@ end
     @test String(take!(io)) ==
         "juliac version $(pkgversion(JuliaC)), julia version $(VERSION)\n"
 end
+
+# https://github.com/JuliaLang/JuliaC.jl/issues/106 + #124
+# Simulate the Pkg-app shim env by running `julia -m JuliaC` with
+# JULIA_LOAD_PATH=<JuliaC project>/. This requires $ROOT to contain a
+# resolved Manifest.toml, which is only true in a dev checkout — Pkg-installed
+# JuliaC has its Manifest.toml gitignored. Gate the test on an opt-in env var
+# set in JuliaC's own CI (.github/workflows/ci.yml), so it doesn't run when
+# JuliaC is exercised as an installed package (e.g. from Julia's CI).
+if get(ENV, "JULIAC_TEST_PKG_APP_SHIM_SIM", "") == "1"
+@testset "Pkg app JULIA_LOAD_PATH isolation (#106)" begin
+    isfile(joinpath(ROOT, "Manifest.toml")) ||
+        error("JULIAC_TEST_PKG_APP_SHIM_SIM=1 requires a resolved \$ROOT/Manifest.toml")
+    outdir = mktempdir()
+    exename = "app_pkgapp"
+    cmd = addenv(
+        `$(Base.julia_cmd()) --startup-file=no --history-file=no --project=$(ROOT) -m JuliaC
+         --output-exe $exename $(TEST_PROJ) --bundle $outdir --verbose`,
+        "JULIA_LOAD_PATH" => ROOT * "/",
+    )
+    @test success(cmd)
+    actual_exe = Sys.iswindows() ? joinpath(outdir, "bin", exename * ".exe") : joinpath(outdir, "bin", exename)
+    @test isfile(actual_exe)
+    if isfile(actual_exe)
+        output = read(`$actual_exe`, String)
+        @test occursin("Fast compilation test!", output)
+    end
+end
+end
+
+# End-to-end: install JuliaC as a Pkg app, invoke the shim, compile a project.
+# Unix-only: the Pkg app shim is a shell script on Unix, a .cmd on Windows.
+if Sys.isunix()
+@testset "Pkg app end-to-end (#106)" begin
+    mktempdir() do depot
+        outdir = mktempdir()
+        exename = "app_e2e"
+        sep = ":"
+        bindir = joinpath(depot, "bin")
+
+        depot_path = join([depot; Base.DEPOT_PATH], sep)
+        install_script = """
+        using Pkg
+        Pkg.Apps.develop(; path=$(repr(ROOT)))
+        """
+        install_cmd = addenv(
+            `$(Base.julia_cmd()) --startup-file=no --history-file=no -e $install_script`,
+            "JULIA_DEPOT_PATH" => depot_path,
+        )
+        @test success(install_cmd)
+
+        shim = joinpath(bindir, "juliac")
+        @test isfile(shim)
+
+        build_cmd = addenv(
+            `$shim --output-exe $exename $(TEST_PROJ) --bundle $outdir --verbose`,
+            "PATH" => bindir * sep * ENV["PATH"],
+        )
+        @test success(build_cmd)
+        actual_exe = joinpath(outdir, "bin", exename)
+        @test isfile(actual_exe)
+        if isfile(actual_exe)
+            output = read(`$actual_exe`, String)
+            @test occursin("Fast compilation test!", output)
+        end
+    end
+end
+end
diff --git a/test/programatic.jl b/test/programatic.jl
index ad8076d..2b8278f 100644
--- a/test/programatic.jl
+++ b/test/programatic.jl
@@ -496,6 +496,56 @@ end
     @test occursin("nthreadpools=1", out)
 end
 
+# https://github.com/JuliaLang/JuliaC.jl/issues/124
+const DEP_PROJ = abspath(joinpath(@__DIR__, "DepProject"))
+
+@testset "Project with dependencies (no trim) (#124)" begin
+    outdir = mktempdir()
+    exeout = joinpath(outdir, "depproject")
+
+    img = JuliaC.ImageRecipe(
+        file = DEP_PROJ,
+        output_type = "--output-exe",
+        verbose = true,
+    )
+    JuliaC.compile_products(img)
+    link = JuliaC.LinkRecipe(image_recipe=img, outname=exeout, rpath=JuliaC.RPATH_BUNDLE)
+    JuliaC.link_products(link)
+    bun = JuliaC.BundleRecipe(link_recipe=link, output_dir=outdir)
+    JuliaC.bundle_products(bun)
+
+    actual_exe = Sys.iswindows() ? joinpath(outdir, "bin", basename(exeout) * ".exe") : joinpath(outdir, "bin", basename(exeout))
+    @test isfile(actual_exe)
+    if isfile(actual_exe)
+        output = read(`$actual_exe`, String)
+        @test occursin("sha256:", output)
+    end
+end
+
+@testset "Project with dependencies (trim) (#124)" begin
+    outdir = mktempdir()
+    exeout = joinpath(outdir, "depproject_trim")
+
+    img = JuliaC.ImageRecipe(
+        file = DEP_PROJ,
+        output_type = "--output-exe",
+        trim_mode = "safe",
+        verbose = true,
+    )
+    JuliaC.compile_products(img)
+    link = JuliaC.LinkRecipe(image_recipe=img, outname=exeout, rpath=JuliaC.RPATH_BUNDLE)
+    JuliaC.link_products(link)
+    bun = JuliaC.BundleRecipe(link_recipe=link, output_dir=outdir)
+    JuliaC.bundle_products(bun)
+
+    actual_exe = Sys.iswindows() ? joinpath(outdir, "bin", basename(exeout) * ".exe") : joinpath(outdir, "bin", basename(exeout))
+    @test isfile(actual_exe)
+    if isfile(actual_exe)
+        output = read(`$actual_exe`, String)
+        @test occursin("sha256:", output)
+    end
+end
+
 @testset "Project as File" begin
     outdir = mktempdir()
     exeout = joinpath(outdir, "prog_exe_projfile")