diff --git a/packages/angular_devkit/build_angular/test/hello-world-lib/projects/lib/tsconfig.lib.json b/packages/angular_devkit/build_angular/test/hello-world-lib/projects/lib/tsconfig.lib.json
index 0af783fbaf1e..63dd9b693892 100644
--- a/packages/angular_devkit/build_angular/test/hello-world-lib/projects/lib/tsconfig.lib.json
+++ b/packages/angular_devkit/build_angular/test/hello-world-lib/projects/lib/tsconfig.lib.json
@@ -11,11 +11,6 @@
       "es2018"
     ]
   },
-  "angularCompilerOptions": {
-    "skipTemplateCodegen": true,
-    "strictMetadataEmit": true,
-    "enableResourceInlining": true
-  },
   "exclude": [
     "src/test.ts",
     "**/*.spec.ts"
diff --git a/packages/angular_devkit/build_angular/test/hello-world-lib/projects/lib/tsconfig.lib.prod.json b/packages/angular_devkit/build_angular/test/hello-world-lib/projects/lib/tsconfig.lib.prod.json
index 04c0e66277e0..2a2faa884cf3 100644
--- a/packages/angular_devkit/build_angular/test/hello-world-lib/projects/lib/tsconfig.lib.prod.json
+++ b/packages/angular_devkit/build_angular/test/hello-world-lib/projects/lib/tsconfig.lib.prod.json
@@ -4,6 +4,6 @@
     "declarationMap": false
   },
   "angularCompilerOptions": {
-    "enableIvy": false
+    "compilationMode": "partial"
   }
 }
diff --git a/packages/schematics/angular/library/files/tsconfig.lib.json.template b/packages/schematics/angular/library/files/tsconfig.lib.json.template
index f3c3f4aa6429..202a2d21c6f9 100644
--- a/packages/schematics/angular/library/files/tsconfig.lib.json.template
+++ b/packages/schematics/angular/library/files/tsconfig.lib.json.template
@@ -13,11 +13,6 @@
       "es2018"
     ]
   },
-  "angularCompilerOptions": {
-    "skipTemplateCodegen": true,
-    "strictMetadataEmit": true,
-    "enableResourceInlining": true
-  },
   "exclude": [
     "src/test.ts",
     "**/*.spec.ts"
diff --git a/packages/schematics/angular/library/files/tsconfig.lib.prod.json.template b/packages/schematics/angular/library/files/tsconfig.lib.prod.json.template
index 5615c27df63f..06de549e1072 100644
--- a/packages/schematics/angular/library/files/tsconfig.lib.prod.json.template
+++ b/packages/schematics/angular/library/files/tsconfig.lib.prod.json.template
@@ -5,6 +5,6 @@
     "declarationMap": false
   },
   "angularCompilerOptions": {
-    "enableIvy": false
+    "compilationMode": "partial"
   }
 }
diff --git a/packages/schematics/angular/utility/latest-versions.ts b/packages/schematics/angular/utility/latest-versions.ts
index fa10fd161d19..3b2c4d88c52a 100644
--- a/packages/schematics/angular/utility/latest-versions.ts
+++ b/packages/schematics/angular/utility/latest-versions.ts
@@ -20,5 +20,5 @@ export const latestVersions = {
   // should not be updated.
   DevkitBuildAngular: '~0.1200.0-next.9',
 
-  ngPackagr: '^12.0.0-next.0',
+  ngPackagr: '^12.0.0-next.8',
 };
diff --git a/tests/legacy-cli/e2e/tests/generate/library/library-basic.ts b/tests/legacy-cli/e2e/tests/generate/library/library-basic.ts
deleted file mode 100644
index 33f1c92f4758..000000000000
--- a/tests/legacy-cli/e2e/tests/generate/library/library-basic.ts
+++ /dev/null
@@ -1,11 +0,0 @@
-import { ng } from '../../../utils/process';
-import { expectFileToMatch } from '../../../utils/fs';
-import { useCIChrome } from '../../../utils/project';
-
-export default function () {
-  return ng('generate', 'library', 'my-lib')
-    .then(() => expectFileToMatch('angular.json', /\"my-lib\":/))
-    .then(() => useCIChrome('projects/my-lib'))
-    .then(() => ng('build', 'my-lib', '--configuration=development'))
-    .then(() => ng('test', 'my-lib', '--watch=false'));
-}
diff --git a/tests/legacy-cli/e2e/tests/generate/library/library-consumption.ts b/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-full.ts
similarity index 78%
rename from tests/legacy-cli/e2e/tests/generate/library/library-consumption.ts
rename to tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-full.ts
index 1d292cdc6f8e..b523bbc67bb1 100644
--- a/tests/legacy-cli/e2e/tests/generate/library/library-consumption.ts
+++ b/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-full.ts
@@ -1,8 +1,10 @@
 import { writeFile } from '../../../utils/fs';
 import { ng } from '../../../utils/process';
+import { updateJsonFile } from '../../../utils/project';
 
 export default async function () {
   await ng('generate', 'library', 'my-lib');
+
   await writeFile('./src/app/app.module.ts', `
       import { BrowserModule } from '@angular/platform-browser';
       import { NgModule } from '@angular/core';
@@ -33,7 +35,7 @@ export default async function () {
         template: '<lib-my-lib></lib-my-lib>'
       })
       export class AppComponent {
-        title = 'app';
+        title = 'test-project';
 
         constructor(myLibService: MyLibService) {
           console.log(myLibService);
@@ -67,19 +69,24 @@ export default async function () {
     });
   `);
 
-  await runLibraryTests();
-  await runLibraryTests(true);
-}
+  // Build library in full mode (development)
+  await ng('build', 'my-lib', '--configuration=development');
 
-async function runLibraryTests(prodMode = false): Promise<void> {
-  const args = ['build', 'my-lib'];
-  if (!prodMode) {
-    args.push('--configuration=development');
-  }
+  // AOT linking
+  await runTests();
 
-  await ng(...args);
+  // JIT linking
+  await updateJsonFile('angular.json', config => {
+    const build = config.projects['test-project'].architect.build;
+    build.options.aot = false;
+    build.configurations.production.buildOptimizer = false;
+  });
+
+  await runTests();
+}
 
-  // Check that the tests succeeds both with named project, unnammed (should test app), and prod.
+async function runTests(): Promise<void> {
+  // Check that the tests succeeds both with named project, unnamed (should test app), and prod.
   await ng('e2e');
   await ng('e2e', 'test-project', '--devServerTarget=test-project:serve:production');
 }
diff --git a/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-partial.ts b/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-partial.ts
new file mode 100644
index 000000000000..076ceb65cd80
--- /dev/null
+++ b/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ivy-partial.ts
@@ -0,0 +1,92 @@
+import { writeFile } from '../../../utils/fs';
+import { ng } from '../../../utils/process';
+import { updateJsonFile } from '../../../utils/project';
+
+export default async function () {
+  await ng('generate', 'library', 'my-lib');
+
+  await writeFile('./src/app/app.module.ts', `
+      import { BrowserModule } from '@angular/platform-browser';
+      import { NgModule } from '@angular/core';
+      import { MyLibModule } from 'my-lib';
+
+      import { AppComponent } from './app.component';
+
+      @NgModule({
+        declarations: [
+          AppComponent
+        ],
+        imports: [
+          BrowserModule,
+          MyLibModule,
+        ],
+        providers: [],
+        bootstrap: [AppComponent]
+      })
+      export class AppModule { }
+    `);
+
+  await writeFile('./src/app/app.component.ts', `
+      import { Component } from '@angular/core';
+      import { MyLibService } from 'my-lib';
+
+      @Component({
+        selector: 'app-root',
+        template: '<lib-my-lib></lib-my-lib>'
+      })
+      export class AppComponent {
+        title = 'test-project';
+
+        constructor(myLibService: MyLibService) {
+          console.log(myLibService);
+        }
+      }
+    `);
+
+  await writeFile('e2e/src/app.e2e-spec.ts', `
+    import { browser, logging, element, by } from 'protractor';
+    import { AppPage } from './app.po';
+
+    describe('workspace-project App', () => {
+      let page: AppPage;
+
+      beforeEach(() => {
+        page = new AppPage();
+      });
+
+      it('should display text from library component', async () => {
+        await page.navigateTo();
+        expect(await element(by.css('lib-my-lib p')).getText()).toEqual('my-lib works!');
+      });
+
+      afterEach(async () => {
+        // Assert that there are no errors emitted from the browser
+        const logs = await browser.manage().logs().get(logging.Type.BROWSER);
+        expect(logs).not.toContain(jasmine.objectContaining({
+          level: logging.Level.SEVERE,
+        }));
+      });
+    });
+  `);
+
+  // Build library in partial mode (production)
+  await ng('build', 'my-lib', '--configuration=production');
+
+  // AOT linking
+  await runTests();
+
+  // JIT linking
+  await updateJsonFile('angular.json', config => {
+    const build = config.projects['test-project'].architect.build;
+    build.options.aot = false;
+    build.configurations.production.buildOptimizer = false;
+  });
+
+  await runTests();
+}
+
+async function runTests(): Promise<void> {
+  // Check that the tests succeeds both with named project, unnamed (should test app), and prod.
+  await ng('e2e');
+  await ng('e2e', 'test-project', '--devServerTarget=test-project:serve:production');
+}
diff --git a/tests/legacy-cli/e2e/tests/generate/library/library-consumption-linker.ts b/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ve.ts
similarity index 88%
rename from tests/legacy-cli/e2e/tests/generate/library/library-consumption-linker.ts
rename to tests/legacy-cli/e2e/tests/generate/library/library-consumption-ve.ts
index b1bc3ea7d004..34c4114fdf8f 100644
--- a/tests/legacy-cli/e2e/tests/generate/library/library-consumption-linker.ts
+++ b/tests/legacy-cli/e2e/tests/generate/library/library-consumption-ve.ts
@@ -5,11 +5,11 @@ import { updateJsonFile } from '../../../utils/project';
 export default async function () {
   await ng('generate', 'library', 'my-lib');
 
-  // Enable partial compilation mode (linker) for the library
-  await updateJsonFile('projects/my-lib/tsconfig.lib.json', config => {
+  await updateJsonFile('projects/my-lib/tsconfig.lib.prod.json', config => {
     const { angularCompilerOptions = {} } = config;
-    angularCompilerOptions.enableIvy = true;
-    angularCompilerOptions.compilationMode = 'partial';
+    angularCompilerOptions.enableIvy = false;
+    angularCompilerOptions.skipTemplateCodegen = true;
+    angularCompilerOptions.strictMetadataEmit = true;
     config.angularCompilerOptions = angularCompilerOptions;
   });
 
@@ -77,8 +77,8 @@ export default async function () {
     });
   `);
 
-  // Build library in partial mode (development)
-  await ng('build', 'my-lib', '--configuration=development');
+  // Build library in VE mode (production)
+  await ng('build', 'my-lib', '--configuration=production');
 
   // AOT linking
   await runTests();