diff --git a/.gitignore b/.gitignore
index 3e3600b..10e8b8b 100644
--- a/.gitignore
+++ b/.gitignore
@@ -139,3 +139,5 @@ dmypy.json
 
 # Cython debug symbols
 cython_debug/
+
+_version.py
diff --git a/VERSION b/VERSION
deleted file mode 100644
index d917d3e..0000000
--- a/VERSION
+++ /dev/null
@@ -1 +0,0 @@
-0.1.2
diff --git a/ci/build_python.sh b/ci/build_python.sh
index e8c33a8..92442ad 100755
--- a/ci/build_python.sh
+++ b/ci/build_python.sh
@@ -7,7 +7,10 @@ source rapids-date-string
 
 rapids-print-env
 
-RAPIDS_PACKAGE_VERSION=$(head -1 ./VERSION)
+rapids-mamba-retry install \
+  --yes \
+  'hatchling' 'hatch-vcs'
+RAPIDS_PACKAGE_VERSION=$(hatchling version)
 export RAPIDS_PACKAGE_VERSION
 
 # populates `RATTLER_CHANNELS` array and `RATTLER_ARGS` array
diff --git a/conda/recipes/rapids-cli/recipe.yaml b/conda/recipes/rapids-cli/recipe.yaml
index 0bf5ff3..1207a5e 100644
--- a/conda/recipes/rapids-cli/recipe.yaml
+++ b/conda/recipes/rapids-cli/recipe.yaml
@@ -27,7 +27,8 @@ requirements:
   host:
     - python
     - pip
-    - setuptools >=77.0.0
+    - hatchling
+    - hatch-vcs
   run:
     - python
     - importlib-metadata >=4.13.0
diff --git a/pyproject.toml b/pyproject.toml
index 0649f80..c088411 100644
--- a/pyproject.toml
+++ b/pyproject.toml
@@ -1,10 +1,3 @@
-[build-system]
-requires = [
-    "setuptools>=77.0.0",
-    "wheel",
-]
-build-backend = "setuptools.build_meta"
-
 [project]
 name = "rapids-cli"
 description = "A CLI for RAPIDS"
@@ -40,8 +33,15 @@ nvlink_status = "rapids_cli.doctor.checks.nvlink:check_nvlink_status"
 Homepage = "https://github.com/rapidsai/rapids-cli"
 Source = "https://github.com/rapidsai/rapids-cli"
 
-[tool.setuptools.dynamic]
-version = {file = "VERSION"}
+[build-system]
+requires = ["hatchling", "hatch-vcs"]
+build-backend = "hatchling.build"
+
+[tool.hatch.build.hooks.vcs]
+version-file = "rapids_cli/_version.py"
+
+[tool.hatch.version]
+source = "vcs"
 
 [tool.setuptools.packages.find]
 include = [
diff --git a/rapids_cli/__init__.py b/rapids_cli/__init__.py
index 5549313..d6c0f30 100644
--- a/rapids_cli/__init__.py
+++ b/rapids_cli/__init__.py
@@ -2,3 +2,10 @@
 # All rights reserved.
 # SPDX-License-Identifier: Apache-2.0
 """RAPIDS CLI is a command-line interface for managing RAPIDS projects."""
+
+try:
+    from ._version import version as __version__  # noqa
+    from ._version import version_tuple as __version_tuple__  # noqa
+except ImportError:
+    __version__ = "0.0.0"
+    __version_tuple__ = (0, 0, 0)