diff --git a/.github/workflows/cli.yml b/.github/workflows/cli.yml
index d571703294..dad8437613 100644
--- a/.github/workflows/cli.yml
+++ b/.github/workflows/cli.yml
@@ -6,6 +6,7 @@ on:
       - '.github/workflows/cli.yml'
       - 'packages/cli/**'
       - 'packages/core/**'
+      - 'scripts/**'
 
 jobs:
   build:
@@ -40,19 +41,31 @@ jobs:
       - name: yarn install
         run: yarn install --frozen-lockfile
       - run: yarn build
-      # This creates a new plugin and pollutes the workspace, so it should be run last.
-      - name: verify app serve and plugin creation on Windows
+      # generate temp directory
+      - name: generate tempdir
+        id: generate_tempdir
+        run: echo "::set-output name=tempdir::$(node scripts/generateTempDir.js)"
+        # This creates a new app and plugin which pollutes the workspace, so it should be run last.
+      - name: verify app and plugin creation on Windows
+        working-directory: ${{ steps.generate_tempdir.outputs.tempdir }}
         if: runner.os == 'Windows'
-        run: node scripts/cli-e2e-test.js
-      - name: verify app serve and plugin creation on Linux
+        run: node ${{ github.workspace }}/scripts/cli-e2e-test.js
+        env:
+          BACKSTAGE_E2E_CLI_TEST: true
+      - name: verify app and plugin creation on Linux
+        working-directory: ${{ steps.generate_tempdir.outputs.tempdir }}
         if: runner.os == 'Linux'
         run: |
           sudo sysctl fs.inotify.max_user_watches=524288
-          node scripts/cli-e2e-test.js
-      - name: yarn lint, test after plugin creation
-        working-directory: plugins/test-plugin
-        run: |
-          yarn lint
-          yarn test
+          node ${{ github.workspace }}/scripts/cli-e2e-test.js
         env:
-          CI: true
+          BACKSTAGE_E2E_CLI_TEST: true
+      # This should lint and test both an app and a plugin
+      - name: yarn lint, test after creation
+        working-directory: ${{ steps.generate_tempdir.outputs.tempdir }}
+        run: |
+          cd test-app
+          yarn lint:all
+          yarn test:all
+        env:
+          BACKSTAGE_E2E_CLI_TEST: true
diff --git a/packages/cli/bin/backstage-cli b/packages/cli/bin/backstage-cli
index a8ba74f28a..5288f913d9 100755
--- a/packages/cli/bin/backstage-cli
+++ b/packages/cli/bin/backstage-cli
@@ -19,7 +19,8 @@ const path = require('path');
 
 // Figure out whether we're running inside the backstage repo or as an installed dependency
 const isLocal = require('fs').existsSync(path.resolve(__dirname, '../src'));
-if (!isLocal) {
+
+if (!isLocal || process.env.BACKSTAGE_E2E_CLI_TEST) {
   // src-relative imports are a pain to get to work with plain tsc compilation, as the
   // transpiled code will maintain the imports as they are in the source. Which means an
   // import for `helpers/paths` will start like that in the output, which won't work in NodeJS.
diff --git a/packages/cli/src/commands/build-cache/index.ts b/packages/cli/src/commands/build-cache/index.ts
index a8a1a27e9d..a825a7f415 100644
--- a/packages/cli/src/commands/build-cache/index.ts
+++ b/packages/cli/src/commands/build-cache/index.ts
@@ -30,7 +30,7 @@ export async function withCache(
   buildFunc: () => Promise<void>,
 ): Promise<void> {
   const key = await Cache.readInputKey(options.inputs);
-  if (!key) {
+  if (!key || process.env.BACKSTAGE_E2E_CLI_TEST) {
     print('input directory is dirty, skipping cache');
     await fs.remove(options.output);
     await buildFunc();
diff --git a/packages/cli/src/commands/create-app/createApp.ts b/packages/cli/src/commands/create-app/createApp.ts
index 5863d9e705..219406704d 100644
--- a/packages/cli/src/commands/create-app/createApp.ts
+++ b/packages/cli/src/commands/create-app/createApp.ts
@@ -86,6 +86,34 @@ export async function moveApp(
   });
 }
 
+async function addPackageResolutions(rootDir: string, appDir: string) {
+  process.chdir(appDir);
+
+  const packageFileContent = await fs.readFile('package.json', 'utf-8');
+  const packageFileJson = JSON.parse(packageFileContent);
+
+  if (packageFileJson.resolutions) {
+    throw new Error('package.json already contains resolutions');
+  }
+  packageFileJson.resolutions = {};
+
+  const packages = ['cli', 'core', 'test-utils', 'test-utils-core', 'theme'];
+
+  for (const pkg of packages) {
+    await Task.forItem('adding', `${pkg} link to package.json`, async () => {
+      const pkgPath = require('path').join(rootDir, 'packages', pkg);
+      packageFileJson.resolutions[`@backstage/${pkg}`] = `file:${pkgPath}`;
+      const newContents = `${JSON.stringify(packageFileJson, null, 2)}\n`;
+
+      await fs.writeFile('package.json', newContents, 'utf-8').catch(error => {
+        throw new Error(
+          `Failed to add resolutions to package.json: ${error.message}`,
+        );
+      });
+    });
+  }
+}
+
 export default async () => {
   const questions: Question[] = [
     {
@@ -126,6 +154,15 @@ export default async () => {
     Task.section('Moving to final location');
     await moveApp(tempDir, appDir, answers.name);
 
+    // e2e testing needs special treatment
+    if (process.env.BACKSTAGE_E2E_CLI_TEST) {
+      Task.section('Linking packages locally for e2e tests');
+      const rootDir = process.env.CI
+        ? resolvePath(process.env.GITHUB_WORKSPACE!)
+        : resolvePath(__dirname, '..', '..', '..');
+      await addPackageResolutions(rootDir, appDir);
+    }
+
     Task.section('Building the app');
     await buildApp(appDir);
 
@@ -134,6 +171,7 @@ export default async () => {
       chalk.green(`🥇  Successfully created ${chalk.cyan(answers.name)}`),
     );
     Task.log();
+    Task.exit();
   } catch (error) {
     Task.error(error.message);
 
@@ -143,5 +181,6 @@ export default async () => {
     Task.section('Cleanup');
     await cleanUp(tempDir);
     Task.error('🔥  Failed to create app!');
+    Task.exit(1);
   }
 };
diff --git a/packages/cli/src/commands/create-plugin/createPlugin.ts b/packages/cli/src/commands/create-plugin/createPlugin.ts
index df8b71f619..51f749a6ac 100644
--- a/packages/cli/src/commands/create-plugin/createPlugin.ts
+++ b/packages/cli/src/commands/create-plugin/createPlugin.ts
@@ -268,6 +268,7 @@ export default async () => {
       )}`,
     );
     Task.log();
+    Task.exit();
   } catch (error) {
     Task.error(error.message);
 
@@ -277,5 +278,6 @@ export default async () => {
     Task.section('Cleanup');
     await cleanUp(tempDir);
     Task.error('🔥  Failed to create plugin!');
+    Task.exit(1);
   }
 };
diff --git a/packages/cli/src/commands/plugin/rollup.config.ts b/packages/cli/src/commands/plugin/rollup.config.ts
index fe2675e0e0..c991fa3efb 100644
--- a/packages/cli/src/commands/plugin/rollup.config.ts
+++ b/packages/cli/src/commands/plugin/rollup.config.ts
@@ -46,6 +46,7 @@ export default {
     json(),
     typescript({
       include: `${paths.resolveTarget('src')}/**/*.{js,jsx,ts,tsx}`,
+      clean: true,
     }),
   ],
 } as RollupWatchOptions;
diff --git a/packages/cli/src/helpers/paths.ts b/packages/cli/src/helpers/paths.ts
index 746b3f6ea8..173e77e1c5 100644
--- a/packages/cli/src/helpers/paths.ts
+++ b/packages/cli/src/helpers/paths.ts
@@ -53,7 +53,7 @@ export function findRootPath(topPath: string): string {
       try {
         const contents = fs.readFileSync(packagePath, 'utf8');
         const data = JSON.parse(contents);
-        if (data.name === 'root') {
+        if (data.name === 'root' || data.name.includes('backstage-e2e')) {
           return path;
         }
       } catch (error) {
diff --git a/packages/cli/src/helpers/tasks.ts b/packages/cli/src/helpers/tasks.ts
index 3cba4d262f..0753301b78 100644
--- a/packages/cli/src/helpers/tasks.ts
+++ b/packages/cli/src/helpers/tasks.ts
@@ -37,6 +37,10 @@ export class Task {
     process.stdout.write(`\n ${title}\n`);
   }
 
+  static exit(code: number = 0) {
+    process.exit(code);
+  }
+
   static async forItem(
     task: string,
     item: string,
diff --git a/packages/cli/templates/default-app/packages/app/package.json.hbs b/packages/cli/templates/default-app/packages/app/package.json.hbs
index a5b2b07b96..940091380a 100644
--- a/packages/cli/templates/default-app/packages/app/package.json.hbs
+++ b/packages/cli/templates/default-app/packages/app/package.json.hbs
@@ -5,6 +5,7 @@
   "dependencies": {
     "@material-ui/core": "^4.9.1",
     "@material-ui/icons": "^4.9.1",
+    "@material-ui/lab": "4.0.0-alpha.45",
     "@backstage/cli": "^{{version}}",
     "@backstage/core": "^{{version}}",
     "@backstage/theme": "^{{version}}",
@@ -17,7 +18,8 @@
     "plugin-welcome": "0.0.0",
     "react": "^16.12.0",
     "react-dom": "^16.12.0",
-    "react-router-dom": "^5.1.2"
+    "react-router-dom": "^5.1.2",
+    "react-use": "^13.24.0"
   },
   "scripts": {
     "start": "backstage-cli app:serve",
diff --git a/scripts/cli-e2e-test.js b/scripts/cli-e2e-test.js
index 48058550d9..4af26e2e41 100644
--- a/scripts/cli-e2e-test.js
+++ b/scripts/cli-e2e-test.js
@@ -15,168 +15,75 @@
  */
 
 const { resolve: resolvePath } = require('path');
-const childProcess = require('child_process');
-const { spawn } = childProcess;
 const Browser = require('zombie');
 
-const EXPECTED_LOAD_ERRORS = /ECONNREFUSED|ECONNRESET|did not get to load all resources/;
+const {
+  spawnPiped,
+  handleError,
+  waitForPageWithText,
+  waitForExit,
+  print,
+} = require('./helpers');
+
+const createTestApp = require('./createTestApp');
+const createTestPlugin = require('./createTestPlugin');
+const generateTempDir = require('./generateTempDir.js');
 
 Browser.localhost('localhost', 3000);
 
 async function main() {
-  process.env.CI = 'true';
+  process.env.BACKSTAGE_E2E_CLI_TEST = 'true';
 
-  const projectDir = resolvePath(__dirname, '..');
-  process.chdir(projectDir);
+  const rootDir = process.env.CI
+    ? resolvePath(process.env.GITHUB_WORKSPACE)
+    : resolvePath(__dirname, '..');
 
-  const start = spawnPiped(['yarn', 'start']);
+  const tempDir = process.env.CI ? process.cwd() : await generateTempDir();
+
+  process.stdout.write(`Initial directory: ${process.cwd()}\n`);
+  process.chdir(tempDir);
+  process.stdout.write(`Temp directory: ${process.cwd()}\n`);
+
+  await waitForExit(spawnPiped(['yarn', 'init --yes']));
+
+  const createCmdPath = require('path').join(
+    rootDir,
+    'packages',
+    'cli',
+    'bin',
+    'backstage-cli',
+  );
+  await createTestApp(`${createCmdPath} create-app`);
+
+  const appDir = resolvePath(tempDir, 'test-app');
+  process.chdir(appDir);
+  process.stdout.write(`App directory: ${appDir}\n`);
+
+  await createTestPlugin();
+
+  print('Starting the app');
+  const startApp = spawnPiped(['yarn', 'start']);
 
   try {
     const browser = new Browser();
 
     await waitForPageWithText(browser, '/', 'Welcome to Backstage');
-    print('Backstage loaded correctly, creating plugin');
-
-    const createPlugin = spawnPiped(['yarn', 'create-plugin']);
-
-    let stdout = '';
-    createPlugin.stdout.on('data', data => {
-      stdout = stdout + data.toString('utf8');
-    });
-
-    await waitFor(() => stdout.includes('Enter an ID for the plugin'));
-    createPlugin.stdin.write('test-plugin\n');
-
-    await waitFor(() => stdout.includes('Enter the owner(s) of the plugin'));
-    createPlugin.stdin.write('@someuser\n');
-
-    print('Waiting for plugin create script to be done');
-    await waitForExit(createPlugin);
-
-    print('Plugin create script is done, waiting for plugin page to load');
     await waitForPageWithText(
       browser,
       '/test-plugin',
       'Welcome to test-plugin!',
     );
 
-    print('Test plugin loaded correctly, exiting');
+    print('Both App and Plugin loaded correctly');
   } finally {
-    start.kill();
+    startApp.kill();
   }
-  await waitForExit(start);
 
+  await waitForExit(startApp);
+
+  print('All tests done');
   process.exit(0);
 }
 
-function waitFor(fn) {
-  return new Promise(resolve => {
-    const handle = setInterval(() => {
-      if (fn()) {
-        clearInterval(handle);
-        resolve();
-        return;
-      }
-    }, 100);
-  });
-}
-
-function print(msg) {
-  return process.stdout.write(`${msg}\n`);
-}
-
-async function waitForExit(child) {
-  if (child.exitCode !== null) {
-    throw new Error(`Child already exited with code ${child.exitCode}`);
-  }
-  await new Promise((resolve, reject) =>
-    child.once('exit', code => {
-      if (code) {
-        reject(new Error(`Child exited with code ${code}`));
-      } else {
-        resolve();
-      }
-    }),
-  );
-}
-
-function spawnPiped(cmd, options) {
-  function pipeWithPrefix(stream, prefix = '') {
-    return data => {
-      const prefixedMsg = data
-        .toString('utf8')
-        .trimRight()
-        .replace(/^/gm, prefix);
-      stream.write(`${prefixedMsg}\n`, 'utf8');
-    };
-  }
-
-  const child = spawn(cmd[0], cmd.slice(1), {
-    stdio: 'pipe',
-    shell: true,
-    ...options,
-  });
-  child.on('error', handleError);
-  child.on('exit', code => {
-    if (code) {
-      print(`Child '${cmd.join(' ')}' exited with code ${code}`);
-      process.exit(code);
-    }
-  });
-  child.stdout.on(
-    'data',
-    pipeWithPrefix(process.stdout, `[${cmd.join(' ')}].out: `),
-  );
-  child.stderr.on(
-    'data',
-    pipeWithPrefix(process.stderr, `[${cmd.join(' ')}].err: `),
-  );
-
-  return child;
-}
-
-async function waitForPageWithText(
-  browser,
-  path,
-  text,
-  { intervalMs = 1000, maxAttempts = 120 } = {},
-) {
-  let attempts = 0;
-  for (;;) {
-    try {
-      await new Promise(resolve => setTimeout(resolve, intervalMs));
-      await browser.visit(path);
-      break;
-    } catch (error) {
-      if (error.message.match(EXPECTED_LOAD_ERRORS)) {
-        attempts++;
-        if (attempts > maxAttempts) {
-          throw new Error(
-            `Failed to load page '${path}', max number of attempts reached`,
-          );
-        }
-      } else {
-        throw error;
-      }
-    }
-  }
-
-  const escapedText = text.replace(/"/g, '\\"');
-  browser.assert.evaluate(
-    `Array.from(document.querySelectorAll("*")).some(el => el.textContent === "${escapedText}")`,
-    true,
-    `expected to find text ${text}`,
-  );
-}
-
-function handleError(err) {
-  process.stdout.write(`${err.name}: ${err.stack || err.message}\n`);
-  if (typeof err.code === 'number') {
-    process.exit(err.code);
-  } else {
-    process.exit(1);
-  }
-}
-
 process.on('unhandledRejection', handleError);
 main(process.argv.slice(2)).catch(handleError);
diff --git a/scripts/createTestApp.js b/scripts/createTestApp.js
new file mode 100644
index 0000000000..80f7bf3b18
--- /dev/null
+++ b/scripts/createTestApp.js
@@ -0,0 +1,41 @@
+/*
+ * Copyright 2020 Spotify AB
+ *
+ * Licensed under the Apache License, Version 2.0 (the "License");
+ * you may not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *     http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing, software
+ * distributed under the License is distributed on an "AS IS" BASIS,
+ * WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+ * See the License for the specific language governing permissions and
+ * limitations under the License.
+ */
+
+const { spawnPiped, waitFor, waitForExit, print } = require('./helpers');
+
+async function createTestApp(cmd) {
+  print('Creating a Backstage App');
+  const createApp = spawnPiped(['node', cmd]);
+
+  try {
+    let stdout = '';
+    createApp.stdout.on('data', data => {
+      stdout = stdout + data.toString('utf8');
+    });
+
+    await waitFor(() => stdout.includes('Enter a name for the app'));
+    createApp.stdin.write('test-app\n');
+
+    print('Waiting for app create script to be done');
+    await waitForExit(createApp);
+
+    print('Test app created');
+  } finally {
+    createApp.kill();
+  }
+}
+
+module.exports = createTestApp;
diff --git a/scripts/createTestPlugin.js b/scripts/createTestPlugin.js
new file mode 100644
index 0000000000..59e8d6dd77
--- /dev/null
+++ b/scripts/createTestPlugin.js
@@ -0,0 +1,44 @@
+/*
+ * Copyright 2020 Spotify AB
+ *
+ * Licensed under the Apache License, Version 2.0 (the "License");
+ * you may not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *     http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing, software
+ * distributed under the License is distributed on an "AS IS" BASIS,
+ * WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+ * See the License for the specific language governing permissions and
+ * limitations under the License.
+ */
+
+const { spawnPiped, waitFor, waitForExit, print } = require('./helpers');
+
+async function createTestPlugin() {
+  print('Creating a Backstage Plugin');
+  const createPlugin = spawnPiped(['yarn', 'create-plugin']);
+
+  try {
+    let stdout = '';
+    createPlugin.stdout.on('data', data => {
+      stdout = stdout + data.toString('utf8');
+    });
+
+    await waitFor(() => stdout.includes('Enter an ID for the plugin'));
+    createPlugin.stdin.write('test-plugin\n');
+
+    // await waitFor(() => stdout.includes('Enter the owner(s) of the plugin'));
+    // createPlugin.stdin.write('@someuser\n');
+
+    print('Waiting for plugin create script to be done');
+    await waitForExit(createPlugin);
+
+    print('Test plugin created');
+  } finally {
+    createPlugin.kill();
+  }
+}
+
+module.exports = createTestPlugin;
diff --git a/scripts/generateTempDir.js b/scripts/generateTempDir.js
new file mode 100644
index 0000000000..e455a29320
--- /dev/null
+++ b/scripts/generateTempDir.js
@@ -0,0 +1,30 @@
+/*
+ * Copyright 2020 Spotify AB
+ *
+ * Licensed under the Apache License, Version 2.0 (the "License");
+ * you may not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *     http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing, software
+ * distributed under the License is distributed on an "AS IS" BASIS,
+ * WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+ * See the License for the specific language governing permissions and
+ * limitations under the License.
+ */
+
+const { handleError } = require('./helpers');
+
+async function generateTempDir() {
+  const tempDir = await require('fs-extra').mkdtemp(
+    require('path').join(require('os').tmpdir(), 'backstage-e2e-'),
+  );
+  process.stdout.write(tempDir);
+  return tempDir;
+}
+
+module.exports = generateTempDir;
+
+process.on('unhandledRejection', handleError);
+generateTempDir().catch(handleError);
diff --git a/scripts/helpers.js b/scripts/helpers.js
new file mode 100644
index 0000000000..7e34f10a63
--- /dev/null
+++ b/scripts/helpers.js
@@ -0,0 +1,139 @@
+/*
+ * Copyright 2020 Spotify AB
+ *
+ * Licensed under the Apache License, Version 2.0 (the "License");
+ * you may not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *     http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing, software
+ * distributed under the License is distributed on an "AS IS" BASIS,
+ * WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+ * See the License for the specific language governing permissions and
+ * limitations under the License.
+ */
+
+const childProcess = require('child_process');
+const { spawn } = childProcess;
+
+const EXPECTED_LOAD_ERRORS = /ECONNREFUSED|ECONNRESET|did not get to load all resources/;
+
+function spawnPiped(cmd, options) {
+  function pipeWithPrefix(stream, prefix = '') {
+    return data => {
+      const prefixedMsg = data
+        .toString('utf8')
+        .trimRight()
+        .replace(/^/gm, prefix);
+      stream.write(`${prefixedMsg}\n`, 'utf8');
+    };
+  }
+
+  const child = spawn(cmd[0], cmd.slice(1), {
+    stdio: 'pipe',
+    shell: true,
+    ...options,
+  });
+  child.on('error', handleError);
+  child.on('exit', code => {
+    if (code) {
+      print(`Child '${cmd.join(' ')}' exited with code ${code}`);
+      process.exit(code);
+    }
+  });
+  child.stdout.on(
+    'data',
+    pipeWithPrefix(process.stdout, `[${cmd.join(' ')}].out: `),
+  );
+  child.stderr.on(
+    'data',
+    pipeWithPrefix(process.stderr, `[${cmd.join(' ')}].err: `),
+  );
+
+  return child;
+}
+
+function handleError(err) {
+  process.stdout.write(`${err.name}: ${err.stack || err.message}\n`);
+  if (typeof err.code === 'number') {
+    process.exit(err.code);
+  } else {
+    process.exit(1);
+  }
+}
+
+function waitFor(fn) {
+  return new Promise(resolve => {
+    const handle = setInterval(() => {
+      if (fn()) {
+        clearInterval(handle);
+        resolve();
+        return;
+      }
+    }, 100);
+  });
+}
+
+async function waitForExit(child) {
+  if (child.exitCode !== null) {
+    throw new Error(`Child already exited with code ${child.exitCode}`);
+  }
+  await new Promise((resolve, reject) =>
+    child.once('exit', code => {
+      if (code) {
+        reject(new Error(`Child exited with code ${code}`));
+      } else {
+        print('Child finished');
+        resolve();
+      }
+    }),
+  );
+}
+
+async function waitForPageWithText(
+  browser,
+  path,
+  text,
+  { intervalMs = 1000, maxAttempts = 240 } = {},
+) {
+  let attempts = 0;
+  for (;;) {
+    try {
+      await new Promise(resolve => setTimeout(resolve, intervalMs));
+      await browser.visit(path);
+      break;
+    } catch (error) {
+      if (error.message.match(EXPECTED_LOAD_ERRORS)) {
+        attempts++;
+        if (attempts > maxAttempts) {
+          throw new Error(
+            `Failed to load page '${path}', max number of attempts reached`,
+          );
+        }
+      } else {
+        throw error;
+      }
+    }
+  }
+
+  const escapedText = text.replace(/"/g, '\\"');
+  browser.assert.evaluate(
+    `Array.from(document.querySelectorAll("*")).some(el => el.textContent === "${escapedText}")`,
+    true,
+    `expected to find text ${text}`,
+  );
+}
+
+function print(msg) {
+  return process.stdout.write(`${msg}\n`);
+}
+
+module.exports = {
+  spawnPiped,
+  handleError,
+  waitFor,
+  waitForExit,
+  waitForPageWithText,
+  print,
+};