diff --git a/src/package.ts b/src/package.ts
index eeee356a..4ed19827 100644
--- a/src/package.ts
+++ b/src/package.ts
@@ -772,7 +772,7 @@ export class MarkdownProcessor extends BaseProcessor {
 			contents = contents.replace(markdownPathRegex, urlReplace);
 
 			// Replace <img> links with urls
-			contents = contents.replace(/<img.+?src=["']([/.\w\s#-]+)['"].*?>/g, (all, link) => {
+			contents = contents.replace(/<img[^>]+src=["']([/.\w\s#-]+)['"][^>]*>/gm, (all, link) => {
 				const isLinkRelative = !/^\w+:\/\//.test(link) && link[0] !== '#';
 
 				if (!this.baseImagesUrl && isLinkRelative) {
@@ -840,7 +840,13 @@ export class MarkdownProcessor extends BaseProcessor {
 				}
 
 				const src = decodeURI(rawSrc);
-				const srcUrl = new url.URL(src);
+				let srcUrl: url.URL
+
+				try {
+					srcUrl = new url.URL(src);
+				} catch (err) {
+					throw new Error(`Invalid image source in ${this.name}: ${src}`);
+				}
 
 				if (/^data:$/i.test(srcUrl.protocol) && /^image$/i.test(srcUrl.host) && /\/svg/i.test(srcUrl.pathname)) {
 					throw new Error(`SVG data URLs are not allowed in ${this.name}: ${src}`);
@@ -1273,7 +1279,13 @@ export function validateManifest(manifest: Manifest): Manifest {
 
 	(manifest.badges ?? []).forEach(badge => {
 		const decodedUrl = decodeURI(badge.url);
-		const srcUrl = new url.URL(decodedUrl);
+		let srcUrl: url.URL;
+
+		try {
+			srcUrl = new url.URL(decodedUrl);
+		} catch (err) {
+			throw new Error(`Badge URL is invalid: ${badge.url}`);
+		}
 
 		if (!/^https:$/i.test(srcUrl.protocol)) {
 			throw new Error(`Badge URLs must come from an HTTPS source: ${badge.url}`);
diff --git a/src/test/package.test.ts b/src/test/package.test.ts
index 2dfddce2..e4c599b6 100644
--- a/src/test/package.test.ts
+++ b/src/test/package.test.ts
@@ -2896,6 +2896,22 @@ describe('MarkdownProcessor', () => {
 		await throws(() => processor.onFile(readme));
 	});
 
+	it('should allow img tags spanning across lines, issue #904', async () => {
+		const manifest = {
+			name: 'test',
+			publisher: 'mocha',
+			version: '0.0.1',
+			engines: Object.create(null),
+			repository: 'https://github.com/username/repository',
+		};
+		const contents = `<img src="img/screenshots/demo.webp" width="556" height="482"\nalt="recording of  exploring view opened from the command 'Snippets Ranger: Show me that dur Range, Partner'. An entry of 'Markdown snippets' from the table of contents is selected and clicked, it takes the user down to the table with the snippets displayed for that extension."/>`;
+		const processor = new ReadmeProcessor(manifest, {});
+		const readme = { path: 'extension/readme.md', contents };
+
+		const file = await processor.onFile(readme);
+		assert.ok(file);
+	});
+
 	it('should catch an unchanged README.md', async () => {
 		const manifest = {
 			name: 'test',