diff --git a/src/common/telemetry/constants.ts b/src/common/telemetry/constants.ts
index 9bcd68ea..35cb1c77 100644
--- a/src/common/telemetry/constants.ts
+++ b/src/common/telemetry/constants.ts
@@ -49,6 +49,7 @@ export enum EventNames {
      * - errorType: string (error class name, on failure only)
      */
     ENVIRONMENT_DISCOVERY = 'ENVIRONMENT_DISCOVERY',
+    MANAGER_READY_TIMEOUT = 'MANAGER_READY.TIMEOUT',
 }
 
 // Map all events to their properties
@@ -226,4 +227,15 @@ export interface IEventNamePropertyMapping {
         envCount?: number;
         errorType?: string;
     };
+
+    /* __GDPR__
+        "manager_ready.timeout": {
+            "managerId": { "classification": "SystemMetaData", "purpose": "FeatureInsight", "owner": "eleanorjboyd" },
+            "managerKind": { "classification": "SystemMetaData", "purpose": "FeatureInsight", "owner": "eleanorjboyd" }
+        }
+    */
+    [EventNames.MANAGER_READY_TIMEOUT]: {
+        managerId: string;
+        managerKind: 'environment' | 'package';
+    };
 }
diff --git a/src/features/common/managerReady.ts b/src/features/common/managerReady.ts
index a7341b80..c85b3134 100644
--- a/src/features/common/managerReady.ts
+++ b/src/features/common/managerReady.ts
@@ -1,12 +1,16 @@
 import { Disposable, l10n, Uri } from 'vscode';
-import { EnvironmentManagers, PythonProjectManager } from '../../internal.api';
-import { createDeferred, Deferred } from '../../common/utils/deferred';
 import { allExtensions, getExtension } from '../../common/extension.apis';
-import { traceError, traceInfo } from '../../common/logging';
-import { showErrorMessage } from '../../common/window.apis';
-import { getDefaultEnvManagerSetting, getDefaultPkgManagerSetting } from '../settings/settingHelpers';
 import { WorkbenchStrings } from '../../common/localize';
+import { traceError, traceInfo, traceWarn } from '../../common/logging';
+import { EventNames } from '../../common/telemetry/constants';
+import { sendTelemetryEvent } from '../../common/telemetry/sender';
+import { createDeferred, Deferred } from '../../common/utils/deferred';
+import { showErrorMessage } from '../../common/window.apis';
 import { installExtension } from '../../common/workbenchCommands';
+import { EnvironmentManagers, PythonProjectManager } from '../../internal.api';
+import { getDefaultEnvManagerSetting, getDefaultPkgManagerSetting } from '../settings/settingHelpers';
+
+const MANAGER_READY_TIMEOUT_MS = 30_000;
 
 interface ManagerReady extends Disposable {
     waitForEnvManager(uris?: Uri[]): Promise<void>;
@@ -29,7 +33,10 @@ class ManagerReadyImpl implements ManagerReady {
     private readonly checked: Set<string> = new Set();
     private readonly disposables: Disposable[] = [];
 
-    constructor(em: EnvironmentManagers, private readonly pm: PythonProjectManager) {
+    constructor(
+        em: EnvironmentManagers,
+        private readonly pm: PythonProjectManager,
+    ) {
         this.disposables.push(
             em.onDidChangeEnvironmentManager((e) => {
                 if (this.envManagers.has(e.manager.id)) {
@@ -104,6 +111,44 @@ class ManagerReadyImpl implements ManagerReady {
         }
     }
 
+    /**
+     * Wraps a deferred with a timeout so a missing/dead manager cannot block the API forever.
+     * On timeout the deferred is resolved (not rejected) so callers proceed with degraded results
+     * instead of hanging.
+     */
+    private _withTimeout(deferred: Deferred<void>, managerId: string, kind: string): Promise<void> {
+        if (deferred.completed) {
+            return deferred.promise;
+        }
+        return new Promise<void>((resolve) => {
+            const timer = setTimeout(() => {
+                if (!deferred.completed) {
+                    traceWarn(
+                        `Timed out after ${MANAGER_READY_TIMEOUT_MS / 1000}s waiting for ${kind} manager "${managerId}" to register. ` +
+                            `The manager may not be installed or its extension failed to activate. Proceeding without it. ` +
+                            `To prevent this, check your "python-envs.defaultEnvManager" and "python-envs.pythonProjects" settings.`,
+                    );
+                    sendTelemetryEvent(EventNames.MANAGER_READY_TIMEOUT, undefined, {
+                        managerId,
+                        managerKind: kind as 'environment' | 'package',
+                    });
+                    deferred.resolve();
+                }
+            }, MANAGER_READY_TIMEOUT_MS);
+
+            deferred.promise.then(
+                () => {
+                    clearTimeout(timer);
+                    resolve();
+                },
+                () => {
+                    clearTimeout(timer);
+                    resolve();
+                },
+            );
+        });
+    }
+
     public dispose(): void {
         this.disposables.forEach((d) => d.dispose());
         this.envManagers.clear();
@@ -116,7 +161,7 @@ class ManagerReadyImpl implements ManagerReady {
         }
         const deferred = createDeferred<void>();
         this.envManagers.set(managerId, deferred);
-        return deferred.promise;
+        return this._withTimeout(deferred, managerId, 'environment');
     }
 
     public async waitForEnvManager(uris?: Uri[]): Promise<void> {
@@ -165,7 +210,7 @@ class ManagerReadyImpl implements ManagerReady {
         }
         const deferred = createDeferred<void>();
         this.pkgManagers.set(managerId, deferred);
-        return deferred.promise;
+        return this._withTimeout(deferred, managerId, 'package');
     }
 
     public async waitForPkgManager(uris?: Uri[]): Promise<void> {