diff --git a/.actions/assistant.py b/.actions/assistant.py
index c1e2f08c34..ac0f83458e 100644
--- a/.actions/assistant.py
+++ b/.actions/assistant.py
@@ -22,9 +22,9 @@ from distutils.version import LooseVersion
 from itertools import chain
 from os.path import dirname, isfile
 from pathlib import Path
-from typing import Any, Dict, Iterable, Iterator, List, Optional, Sequence, Tuple, Union
+from typing import Any, Dict, Iterable, Iterator, List, Optional, Sequence, Tuple
 
-from pkg_resources import Requirement, parse_requirements, yield_lines
+from packaging.requirements import Requirement
 
 REQUIREMENT_FILES = {
     "pytorch": (
@@ -80,14 +80,15 @@ class _RequirementWithComment(Requirement):
         out = str(self)
         if self.strict:
             return f"{out}  {self.strict_string}"
+        specs = [(spec.operator, spec.version) for spec in self.specifier]
         if unfreeze == "major":
-            for operator, version in self.specs:
+            for operator, version in specs:
                 if operator in ("<", "<="):
                     major = LooseVersion(version).version[0]
                     # replace upper bound with major version increased by one
                     return out.replace(f"{operator}{version}", f"<{major + 1}.0")
         elif unfreeze == "all":
-            for operator, version in self.specs:
+            for operator, version in specs:
                 if operator in ("<", "<="):
                     # drop upper bound
                     return out.replace(f"{operator}{version},", "")
@@ -96,33 +97,25 @@ class _RequirementWithComment(Requirement):
         return out
 
 
-def _parse_requirements(strs: Union[str, Iterable[str]]) -> Iterator[_RequirementWithComment]:
+def _parse_requirements(lines: Iterable[str]) -> Iterator[_RequirementWithComment]:
     """Adapted from `pkg_resources.parse_requirements` to include comments.
 
     >>> txt = ['# ignored', '', 'this # is an', '--piparg', 'example', 'foo # strict', 'thing', '-r different/file.txt']
     >>> [r.adjust('none') for r in _parse_requirements(txt)]
     ['this', 'example', 'foo  # strict', 'thing']
-    >>> txt = '\\n'.join(txt)
-    >>> [r.adjust('none') for r in _parse_requirements(txt)]
-    ['this', 'example', 'foo  # strict', 'thing']
 
     """
-    lines = yield_lines(strs)
     pip_argument = None
     for line in lines:
+        line = line.strip()
+        if not line or line.startswith("#"):
+            continue
         # Drop comments -- a hash without a space may be in a URL.
         if " #" in line:
             comment_pos = line.find(" #")
             line, comment = line[:comment_pos], line[comment_pos:]
         else:
             comment = ""
-        # If there is a line continuation, drop it, and append the next line.
-        if line.endswith("\\"):
-            line = line[:-2].strip()
-            try:
-                line += next(lines)
-            except StopIteration:
-                return
         # If there's a pip argument, save it
         if line.startswith("--"):
             pip_argument = line
@@ -148,7 +141,7 @@ def load_requirements(path_dir: str, file_name: str = "base.txt", unfreeze: str
         logging.warning(f"Folder {path_dir} does not have any base requirements.")
         return []
     assert path.exists(), (path_dir, file_name, path)
-    text = path.read_text()
+    text = path.read_text().splitlines()
     return [req.adjust(unfreeze) for req in _parse_requirements(text)]
 
 
@@ -368,7 +361,7 @@ class AssistantCLI:
             if not ln_ or ln_.startswith("#"):
                 final.append(line)
                 continue
-            req = list(parse_requirements(ln_))[0]
+            req = list(_parse_requirements([ln_]))[0]
             if req.name not in packages:
                 final.append(line)
         print(final)
diff --git a/.actions/requirements.txt b/.actions/requirements.txt
index a19661dbae..4b5cc8d568 100644
--- a/.actions/requirements.txt
+++ b/.actions/requirements.txt
@@ -1,2 +1,3 @@
 jsonargparse >=4.16.0, <4.28.0
 requests
+packaging
diff --git a/pyproject.toml b/pyproject.toml
index 4189de8e97..6edd6d1a8f 100644
--- a/pyproject.toml
+++ b/pyproject.toml
@@ -16,6 +16,7 @@
 requires = [
     "setuptools",
     "wheel",
+    "packaging",
 ]
 
 
diff --git a/src/lightning/__setup__.py b/src/lightning/__setup__.py
index 1e6fec715d..09eab5601f 100644
--- a/src/lightning/__setup__.py
+++ b/src/lightning/__setup__.py
@@ -5,7 +5,7 @@ from pathlib import Path
 from types import ModuleType
 from typing import Any, Dict
 
-from setuptools import find_packages
+from setuptools import find_namespace_packages
 
 _PROJECT_ROOT = "."
 _SOURCE_ROOT = os.path.join(_PROJECT_ROOT, "src")
@@ -87,7 +87,7 @@ def _setup_args() -> Dict[str, Any]:
         "url": about.__homepage__,
         "download_url": "https://github.com/Lightning-AI/lightning",
         "license": about.__license__,
-        "packages": find_packages(where="src", include=["lightning", "lightning.*"]),
+        "packages": find_namespace_packages(where="src", include=["lightning", "lightning.*"]),
         "package_dir": {"": "src"},
         "long_description": long_description,
         "long_description_content_type": "text/markdown",
diff --git a/src/lightning/fabric/__init__.py b/src/lightning/fabric/__init__.py
index 26f01aad64..921d3d61e6 100644
--- a/src/lightning/fabric/__init__.py
+++ b/src/lightning/fabric/__init__.py
@@ -37,9 +37,6 @@ import lightning.fabric._graveyard  # noqa: E402, F401  # isort: skip
 
 __all__ = ["Fabric", "seed_everything", "is_wrapped"]
 
-# for compatibility with namespace packages
-__import__("pkg_resources").declare_namespace(__name__)
-
 
 if os.environ.get("POSSIBLE_USER_WARNINGS", "").lower() in ("0", "off"):
     disable_possible_user_warnings()
diff --git a/src/lightning/pytorch/__init__.py b/src/lightning/pytorch/__init__.py
index b8c89f075d..53e7d5b7c1 100644
--- a/src/lightning/pytorch/__init__.py
+++ b/src/lightning/pytorch/__init__.py
@@ -33,8 +33,6 @@ import lightning.pytorch._graveyard  # noqa: E402, F401  # isort: skip
 
 __all__ = ["Trainer", "LightningDataModule", "LightningModule", "Callback", "seed_everything"]
 
-# for compatibility with namespace packages
-__import__("pkg_resources").declare_namespace(__name__)
 
 LIGHTNING_LOGO: str = """
                     ####