diff --git a/package-lock.json b/package-lock.json
index a4e2e7eca..687a7c0c4 100644
--- a/package-lock.json
+++ b/package-lock.json
@@ -1,15 +1,16 @@
 {
   "name": "@modelcontextprotocol/sdk",
-  "version": "1.3.1",
+  "version": "1.3.2",
   "lockfileVersion": 3,
   "requires": true,
   "packages": {
     "": {
       "name": "@modelcontextprotocol/sdk",
-      "version": "1.3.1",
+      "version": "1.3.2",
       "license": "MIT",
       "dependencies": {
         "content-type": "^1.0.5",
+        "eventsource": "^3.0.2",
         "raw-body": "^3.0.0",
         "zod": "^3.23.8",
         "zod-to-json-schema": "^3.24.1"
@@ -24,7 +25,6 @@
         "@types/node": "^22.0.2",
         "@types/ws": "^8.5.12",
         "eslint": "^9.8.0",
-        "eventsource": "^2.0.2",
         "express": "^4.19.2",
         "jest": "^29.7.0",
         "ts-jest": "^29.2.4",
@@ -3066,12 +3066,24 @@
       }
     },
     "node_modules/eventsource": {
-      "version": "2.0.2",
-      "resolved": "https://registry.npmjs.org/eventsource/-/eventsource-2.0.2.tgz",
-      "integrity": "sha512-IzUmBGPR3+oUG9dUeXynyNmf91/3zUSJg1lCktzKw47OXuhco54U3r9B7O4XX+Rb1Itm9OZ2b0RkTs10bICOxA==",
-      "dev": true,
+      "version": "3.0.2",
+      "resolved": "https://registry.npmjs.org/eventsource/-/eventsource-3.0.2.tgz",
+      "integrity": "sha512-YolzkJNxsTL3tCJMWFxpxtG2sCjbZ4LQUBUrkdaJK0ub0p6lmJt+2+1SwhKjLc652lpH9L/79Ptez972H9tphw==",
+      "license": "MIT",
+      "dependencies": {
+        "eventsource-parser": "^3.0.0"
+      },
       "engines": {
-        "node": ">=12.0.0"
+        "node": ">=18.0.0"
+      }
+    },
+    "node_modules/eventsource-parser": {
+      "version": "3.0.0",
+      "resolved": "https://registry.npmjs.org/eventsource-parser/-/eventsource-parser-3.0.0.tgz",
+      "integrity": "sha512-T1C0XCUimhxVQzW4zFipdx0SficT651NnkR0ZSH3yQwh+mFMdLfgjABVi4YtMTtaL4s168593DaoaRLMqryavA==",
+      "license": "MIT",
+      "engines": {
+        "node": ">=18.0.0"
       }
     },
     "node_modules/execa": {
diff --git a/package.json b/package.json
index 6f06fac0a..7e21c07fe 100644
--- a/package.json
+++ b/package.json
@@ -47,6 +47,7 @@
   },
   "dependencies": {
     "content-type": "^1.0.5",
+    "eventsource": "^3.0.2",
     "raw-body": "^3.0.0",
     "zod": "^3.23.8",
     "zod-to-json-schema": "^3.24.1"
@@ -61,7 +62,6 @@
     "@types/node": "^22.0.2",
     "@types/ws": "^8.5.12",
     "eslint": "^9.8.0",
-    "eventsource": "^2.0.2",
     "express": "^4.19.2",
     "jest": "^29.7.0",
     "ts-jest": "^29.2.4",
diff --git a/src/cli.ts b/src/cli.ts
index d5444972d..b5000896d 100644
--- a/src/cli.ts
+++ b/src/cli.ts
@@ -1,8 +1,5 @@
-import EventSource from "eventsource";
 import WebSocket from "ws";
 
-// eslint-disable-next-line @typescript-eslint/no-explicit-any
-(global as any).EventSource = EventSource;
 // eslint-disable-next-line @typescript-eslint/no-explicit-any
 (global as any).WebSocket = WebSocket;
 
diff --git a/src/client/sse.test.ts b/src/client/sse.test.ts
new file mode 100644
index 000000000..f59c45fef
--- /dev/null
+++ b/src/client/sse.test.ts
@@ -0,0 +1,287 @@
+import { createServer, type IncomingMessage, type Server } from "http";
+import { AddressInfo } from "net";
+import { JSONRPCMessage } from "../types.js";
+import { SSEClientTransport } from "./sse.js";
+
+describe("SSEClientTransport", () => {
+  let server: Server;
+  let transport: SSEClientTransport;
+  let baseUrl: URL;
+  let lastServerRequest: IncomingMessage;
+  let sendServerMessage: ((message: string) => void) | null = null;
+
+  beforeEach((done) => {
+    // Reset state
+    lastServerRequest = null as unknown as IncomingMessage;
+    sendServerMessage = null;
+
+    // Create a test server that will receive the EventSource connection
+    server = createServer((req, res) => {
+      lastServerRequest = req;
+
+      // Send SSE headers
+      res.writeHead(200, {
+        "Content-Type": "text/event-stream",
+        "Cache-Control": "no-cache",
+        Connection: "keep-alive",
+      });
+
+      // Send the endpoint event
+      res.write("event: endpoint\n");
+      res.write(`data: ${baseUrl.href}\n\n`);
+
+      // Store reference to send function for tests
+      sendServerMessage = (message: string) => {
+        res.write(`data: ${message}\n\n`);
+      };
+
+      // Handle request body for POST endpoints
+      if (req.method === "POST") {
+        let body = "";
+        req.on("data", (chunk) => {
+          body += chunk;
+        });
+        req.on("end", () => {
+          (req as IncomingMessage & { body: string }).body = body;
+          res.end();
+        });
+      }
+    });
+
+    // Start server on random port
+    server.listen(0, "127.0.0.1", () => {
+      const addr = server.address() as AddressInfo;
+      baseUrl = new URL(`http://127.0.0.1:${addr.port}`);
+      done();
+    });
+  });
+
+  afterEach(async () => {
+    await transport.close();
+    await server.close();
+  });
+
+  describe("connection handling", () => {
+    it("establishes SSE connection and receives endpoint", async () => {
+      transport = new SSEClientTransport(baseUrl);
+      await transport.start();
+
+      expect(lastServerRequest.headers.accept).toBe("text/event-stream");
+      expect(lastServerRequest.method).toBe("GET");
+    });
+
+    it("rejects if server returns non-200 status", async () => {
+      // Create a server that returns 403
+      server.close();
+      await new Promise((resolve) => server.on("close", resolve));
+
+      server = createServer((req, res) => {
+        res.writeHead(403);
+        res.end();
+      });
+
+      await new Promise<void>((resolve) => {
+        server.listen(0, "127.0.0.1", () => {
+          const addr = server.address() as AddressInfo;
+          baseUrl = new URL(`http://127.0.0.1:${addr.port}`);
+          resolve();
+        });
+      });
+
+      transport = new SSEClientTransport(baseUrl);
+      await expect(transport.start()).rejects.toThrow();
+    });
+
+    it("closes EventSource connection on close()", async () => {
+      transport = new SSEClientTransport(baseUrl);
+      await transport.start();
+
+      const closePromise = new Promise((resolve) => {
+        lastServerRequest.on("close", resolve);
+      });
+
+      await transport.close();
+      await closePromise;
+    });
+  });
+
+  describe("message handling", () => {
+    it("receives and parses JSON-RPC messages", async () => {
+      const receivedMessages: JSONRPCMessage[] = [];
+      transport = new SSEClientTransport(baseUrl);
+      transport.onmessage = (msg) => receivedMessages.push(msg);
+
+      await transport.start();
+
+      const testMessage: JSONRPCMessage = {
+        jsonrpc: "2.0",
+        id: "test-1",
+        method: "test",
+        params: { foo: "bar" },
+      };
+
+      sendServerMessage!(JSON.stringify(testMessage));
+
+      // Wait for message processing
+      await new Promise((resolve) => setTimeout(resolve, 50));
+
+      expect(receivedMessages).toHaveLength(1);
+      expect(receivedMessages[0]).toEqual(testMessage);
+    });
+
+    it("handles malformed JSON messages", async () => {
+      const errors: Error[] = [];
+      transport = new SSEClientTransport(baseUrl);
+      transport.onerror = (err) => errors.push(err);
+
+      await transport.start();
+
+      sendServerMessage!("invalid json");
+
+      // Wait for message processing
+      await new Promise((resolve) => setTimeout(resolve, 50));
+
+      expect(errors).toHaveLength(1);
+      expect(errors[0].message).toMatch(/JSON/);
+    });
+
+    it("handles messages via POST requests", async () => {
+      transport = new SSEClientTransport(baseUrl);
+      await transport.start();
+
+      const testMessage: JSONRPCMessage = {
+        jsonrpc: "2.0",
+        id: "test-1",
+        method: "test",
+        params: { foo: "bar" },
+      };
+
+      await transport.send(testMessage);
+
+      // Wait for request processing
+      await new Promise((resolve) => setTimeout(resolve, 50));
+
+      expect(lastServerRequest.method).toBe("POST");
+      expect(lastServerRequest.headers["content-type"]).toBe(
+        "application/json",
+      );
+      expect(
+        JSON.parse(
+          (lastServerRequest as IncomingMessage & { body: string }).body,
+        ),
+      ).toEqual(testMessage);
+    });
+
+    it("handles POST request failures", async () => {
+      // Create a server that returns 500 for POST
+      server.close();
+      await new Promise((resolve) => server.on("close", resolve));
+
+      server = createServer((req, res) => {
+        if (req.method === "GET") {
+          res.writeHead(200, {
+            "Content-Type": "text/event-stream",
+            "Cache-Control": "no-cache",
+            Connection: "keep-alive",
+          });
+          res.write("event: endpoint\n");
+          res.write(`data: ${baseUrl.href}\n\n`);
+        } else {
+          res.writeHead(500);
+          res.end("Internal error");
+        }
+      });
+
+      await new Promise<void>((resolve) => {
+        server.listen(0, "127.0.0.1", () => {
+          const addr = server.address() as AddressInfo;
+          baseUrl = new URL(`http://127.0.0.1:${addr.port}`);
+          resolve();
+        });
+      });
+
+      transport = new SSEClientTransport(baseUrl);
+      await transport.start();
+
+      const testMessage: JSONRPCMessage = {
+        jsonrpc: "2.0",
+        id: "test-1",
+        method: "test",
+        params: {},
+      };
+
+      await expect(transport.send(testMessage)).rejects.toThrow(/500/);
+    });
+  });
+
+  describe("header handling", () => {
+    it("uses custom fetch implementation from EventSourceInit to add auth headers", async () => {
+      const authToken = "Bearer test-token";
+
+      // Create a fetch wrapper that adds auth header
+      const fetchWithAuth = (url: string | URL, init?: RequestInit) => {
+        const headers = new Headers(init?.headers);
+        headers.set("Authorization", authToken);
+        return fetch(url.toString(), { ...init, headers });
+      };
+
+      transport = new SSEClientTransport(baseUrl, {
+        eventSourceInit: {
+          fetch: fetchWithAuth,
+        },
+      });
+
+      await transport.start();
+
+      // Verify the auth header was received by the server
+      expect(lastServerRequest.headers.authorization).toBe(authToken);
+    });
+
+    it("passes custom headers to fetch requests", async () => {
+      const customHeaders = {
+        Authorization: "Bearer test-token",
+        "X-Custom-Header": "custom-value",
+      };
+
+      transport = new SSEClientTransport(baseUrl, {
+        requestInit: {
+          headers: customHeaders,
+        },
+      });
+
+      await transport.start();
+
+      // Mock fetch for the message sending test
+      global.fetch = jest.fn().mockResolvedValue({
+        ok: true,
+      });
+
+      const message: JSONRPCMessage = {
+        jsonrpc: "2.0",
+        id: "1",
+        method: "test",
+        params: {},
+      };
+
+      await transport.send(message);
+
+      // Verify fetch was called with correct headers
+      expect(global.fetch).toHaveBeenCalledWith(
+        expect.any(URL),
+        expect.objectContaining({
+          headers: expect.any(Headers),
+        }),
+      );
+
+      const calledHeaders = (global.fetch as jest.Mock).mock.calls[0][1]
+        .headers;
+      expect(calledHeaders.get("Authorization")).toBe(
+        customHeaders.Authorization,
+      );
+      expect(calledHeaders.get("X-Custom-Header")).toBe(
+        customHeaders["X-Custom-Header"],
+      );
+      expect(calledHeaders.get("content-type")).toBe("application/json");
+    });
+  });
+});
diff --git a/src/client/sse.ts b/src/client/sse.ts
index 0e6e7eb98..932e7e206 100644
--- a/src/client/sse.ts
+++ b/src/client/sse.ts
@@ -1,11 +1,10 @@
 import { Transport } from "../shared/transport.js";
 import { JSONRPCMessage, JSONRPCMessageSchema } from "../types.js";
+import { EventSource, type EventSourceInit } from "eventsource";
 
 /**
  * Client transport for SSE: this will connect to a server using Server-Sent Events for receiving
  * messages and make separate POST requests for sending messages.
- *
- * This uses the EventSource API in browsers. You can install the `eventsource` package for Node.js.
  */
 export class SSEClientTransport implements Transport {
   private _eventSource?: EventSource;
@@ -19,7 +18,10 @@ export class SSEClientTransport implements Transport {
   onerror?: (error: Error) => void;
   onmessage?: (message: JSONRPCMessage) => void;
 
-  constructor(url: URL, opts?: { eventSourceInit?: EventSourceInit, requestInit?: RequestInit }) {
+  constructor(
+    url: URL,
+    opts?: { eventSourceInit?: EventSourceInit; requestInit?: RequestInit },
+  ) {
     this._url = url;
     this._eventSourceInit = opts?.eventSourceInit;
     this._requestInit = opts?.requestInit;
@@ -33,7 +35,10 @@ export class SSEClientTransport implements Transport {
     }
 
     return new Promise((resolve, reject) => {
-      this._eventSource = new EventSource(this._url.href, this._eventSourceInit);
+      this._eventSource = new EventSource(
+        this._url.href,
+        this._eventSourceInit,
+      );
       this._abortController = new AbortController();
 
       this._eventSource.onerror = (event) => {
@@ -101,7 +106,7 @@ export class SSEClientTransport implements Transport {
         method: "POST",
         headers,
         body: JSON.stringify(message),
-        signal: this._abortController?.signal
+        signal: this._abortController?.signal,
       };
 
       const response = await fetch(this._endpoint, init);