diff --git a/CHANGELOG.md b/CHANGELOG.md
index b73a903c..d426619d 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -1,5 +1,11 @@
 # Rojo Changelog
 
+## Unreleased
+
+* Added an update indicator to the version header when a new version of the plugin is available. ([#1069])
+
+[#1069]: https://github.com/rojo-rbx/rojo/pull/1069
+
 ## 7.5.1 - April 25th, 2025
 * Fixed output spam related to `Instance.Capabilities` in the plugin
 
diff --git a/plugin/src/App/Components/Header.lua b/plugin/src/App/Components/Header.lua
index 81e2f46a..fa8c9173 100644
--- a/plugin/src/App/Components/Header.lua
+++ b/plugin/src/App/Components/Header.lua
@@ -9,8 +9,70 @@ local Assets = require(Plugin.Assets)
 local Config = require(Plugin.Config)
 local Version = require(Plugin.Version)
 
+local Tooltip = require(Plugin.App.Components.Tooltip)
+local SlicedImage = require(script.Parent.SlicedImage)
+
 local e = Roact.createElement
 
+local function VersionIndicator(props)
+	local updateMessage = Version.getUpdateMessage()
+
+	return Theme.with(function(theme)
+		return e("Frame", {
+			LayoutOrder = props.layoutOrder,
+			Size = UDim2.new(0, 0, 0, 25),
+			BackgroundTransparency = 1,
+			AutomaticSize = Enum.AutomaticSize.X,
+		}, {
+			Border = if updateMessage
+				then e(SlicedImage, {
+					slice = Assets.Slices.RoundedBorder,
+					color = theme.Button.Bordered.Enabled.BorderColor,
+					transparency = props.transparency,
+					size = UDim2.fromScale(1, 1),
+					zIndex = 0,
+				}, {
+					Indicator = e("ImageLabel", {
+						Size = UDim2.new(0, 10, 0, 10),
+						ScaleType = Enum.ScaleType.Fit,
+						Image = Assets.Images.Circles[16],
+						ImageColor3 = theme.Header.LogoColor,
+						ImageTransparency = props.transparency,
+						BackgroundTransparency = 1,
+						Position = UDim2.new(1, 0, 0, 0),
+						AnchorPoint = Vector2.new(0.5, 0.5),
+					}),
+				})
+				else nil,
+
+			Tip = if updateMessage
+				then e(Tooltip.Trigger, {
+					text = updateMessage,
+					delay = 0.1,
+				})
+				else nil,
+
+			VersionText = e("TextLabel", {
+				Text = Version.display(Config.version),
+				FontFace = theme.Font.Thin,
+				TextSize = theme.TextSize.Body,
+				TextColor3 = theme.Header.VersionColor,
+				TextXAlignment = Enum.TextXAlignment.Left,
+				TextTransparency = props.transparency,
+				BackgroundTransparency = 1,
+
+				Size = UDim2.new(0, 0, 1, 0),
+				AutomaticSize = Enum.AutomaticSize.X,
+			}, {
+				Padding = e("UIPadding", {
+					PaddingLeft = UDim.new(0, 6),
+					PaddingRight = UDim.new(0, 6),
+				}),
+			}),
+		})
+	end)
+end
+
 local function Header(props)
 	return Theme.with(function(theme)
 		return e("Frame", {
@@ -29,18 +91,9 @@ local function Header(props)
 				BackgroundTransparency = 1,
 			}),
 
-			Version = e("TextLabel", {
-				Text = Version.display(Config.version),
-				FontFace = theme.Font.Thin,
-				TextSize = theme.TextSize.Body,
-				TextColor3 = theme.Header.VersionColor,
-				TextXAlignment = Enum.TextXAlignment.Left,
-				TextTransparency = props.transparency,
-
-				Size = UDim2.new(1, 0, 0, theme.TextSize.Body),
-
-				LayoutOrder = 2,
-				BackgroundTransparency = 1,
+			VersionIndicator = e(VersionIndicator, {
+				transparency = props.transparency,
+				layoutOrder = 2,
 			}),
 
 			Layout = e("UIListLayout", {
diff --git a/plugin/src/App/Components/Tooltip.lua b/plugin/src/App/Components/Tooltip.lua
index 25423e8c..49d37af7 100644
--- a/plugin/src/App/Components/Tooltip.lua
+++ b/plugin/src/App/Components/Tooltip.lua
@@ -216,7 +216,7 @@ function Trigger:managePopup()
 			return
 		end
 
-		self.showDelayThread = task.delay(DELAY, function()
+		self.showDelayThread = task.delay(self.props.delay or DELAY, function()
 			self.props.context.addTip(self.id, {
 				Text = self.props.text,
 				Position = self:getMousePos(),
diff --git a/plugin/src/App/init.lua b/plugin/src/App/init.lua
index df1bccac..828f7299 100644
--- a/plugin/src/App/init.lua
+++ b/plugin/src/App/init.lua
@@ -251,27 +251,10 @@ function App:closeNotification(id: number)
 end
 
 function App:checkForUpdates()
-	if not Settings:get("checkForUpdates") then
-		return
-	end
+	local updateMessage = Version.getUpdateMessage()
 
-	local isLocalInstall = string.find(debug.traceback(), "\n[^\n]-user_.-$") ~= nil
-	local latestCompatibleVersion = Version.retrieveLatestCompatible({
-		version = Config.version,
-		includePrereleases = isLocalInstall and Settings:get("checkForPrereleases"),
-	})
-	if not latestCompatibleVersion then
-		return
-	end
-
-	self:addNotification(
-		string.format(
-			"A newer compatible version of Rojo, %s, was published %s! Go to the Rojo releases page to learn more.",
-			Version.display(latestCompatibleVersion.version),
-			timeUtil.elapsedToText(DateTime.now().UnixTimestamp - latestCompatibleVersion.publishedUnixTimestamp)
-		),
-		500,
-		{
+	if updateMessage then
+		self:addNotification(updateMessage, 500, {
 			Dismiss = {
 				text = "Dismiss",
 				style = "Bordered",
@@ -280,8 +263,8 @@ function App:checkForUpdates()
 					notification:dismiss()
 				end,
 			},
-		}
-	)
+		})
+	end
 end
 
 function App:getPriorSyncInfo(): { host: string?, port: string?, projectName: string?, timestamp: number? }
diff --git a/plugin/src/Version.lua b/plugin/src/Version.lua
index d95702e8..197de133 100644
--- a/plugin/src/Version.lua
+++ b/plugin/src/Version.lua
@@ -1,6 +1,20 @@
-local Packages = script.Parent.Parent.Packages
+local Rojo = script:FindFirstAncestor("Rojo")
+local Plugin = Rojo.Plugin
+local Packages = Rojo.Packages
+
 local Http = require(Packages.Http)
 local Promise = require(Packages.Promise)
+local Log = require(Packages.Log)
+
+local Config = require(Plugin.Config)
+local Settings = require(Plugin.Settings)
+local timeUtil = require(Plugin.timeUtil)
+
+type LatestReleaseInfo = {
+	version: { number },
+	prerelease: boolean,
+	publishedUnixTimestamp: number,
+}
 
 local function compare(a, b)
 	if a > b then
@@ -88,14 +102,26 @@ function Version.display(version)
 	return output
 end
 
+--[[
+	The GitHub API rate limit for unauthenticated requests is rather low,
+	and we don't release often enough to warrant checking it more than once a day.
+--]]
+Version._cachedLatestCompatible = nil :: {
+	value: LatestReleaseInfo?,
+	timestamp: number,
+}?
+
 function Version.retrieveLatestCompatible(options: {
 	version: { number },
 	includePrereleases: boolean?,
-}): {
-	version: { number },
-	prerelease: boolean,
-	publishedUnixTimestamp: number,
-}?
+}): LatestReleaseInfo?
+	if Version._cachedLatestCompatible and os.clock() - Version._cachedLatestCompatible.timestamp < 60 * 60 * 24 then
+		Log.debug("Using cached latest compatible version")
+		return Version._cachedLatestCompatible.value
+	end
+
+	Log.debug("Retrieving latest compatible version from GitHub")
+
 	local success, releases = Http.get("https://api.github.com/repos/rojo-rbx/rojo/releases?per_page=10")
 		:andThen(function(response)
 			if response.code >= 400 then
@@ -114,7 +140,7 @@ function Version.retrieveLatestCompatible(options: {
 	end
 
 	-- Iterate through releases, looking for the latest compatible version
-	local latestCompatible = nil
+	local latestCompatible: LatestReleaseInfo? = nil
 	for _, release in releases do
 		-- Skip prereleases if they are not requested
 		if (not options.includePrereleases) and release.prerelease then
@@ -142,10 +168,43 @@ function Version.retrieveLatestCompatible(options: {
 
 	-- Don't return anything if the latest found is not newer than the current version
 	if latestCompatible == nil or Version.compare(latestCompatible.version, options.version) <= 0 then
+		-- Cache as nil so we don't try again for a day
+		Version._cachedLatestCompatible = {
+			value = nil,
+			timestamp = os.clock(),
+		}
+
 		return nil
 	end
 
+	-- Cache the latest compatible version
+	Version._cachedLatestCompatible = {
+		value = latestCompatible,
+		timestamp = os.clock(),
+	}
+
 	return latestCompatible
 end
 
+function Version.getUpdateMessage(): string?
+	if not Settings:get("checkForUpdates") then
+		return
+	end
+
+	local isLocalInstall = string.find(debug.traceback(), "\n[^\n]-user_.-$") ~= nil
+	local latestCompatibleVersion = Version.retrieveLatestCompatible({
+		version = Config.version,
+		includePrereleases = isLocalInstall and Settings:get("checkForPrereleases"),
+	})
+	if not latestCompatibleVersion then
+		return
+	end
+
+	return string.format(
+		"A newer compatible version of Rojo, %s, was published %s! Go to the Rojo releases page to learn more.",
+		Version.display(latestCompatibleVersion.version),
+		timeUtil.elapsedToText(DateTime.now().UnixTimestamp - latestCompatibleVersion.publishedUnixTimestamp)
+	)
+end
+
 return Version