diff --git a/README.md b/README.md
index 9fb9ce8e..22da9ac0 100644
--- a/README.md
+++ b/README.md
@@ -953,6 +953,21 @@ How the module is built.
 │   └── README.md                           # Module-level docs ingested by Document-PSModule
 ```
 
+### Declaring module dependencies
+
+Declare module dependencies using
+[`#Requires -Modules`](https://learn.microsoft.com/en-us/powershell/module/microsoft.powershell.core/about/about_requires)
+statements at the top of function files in `src/functions/public/` or `src/functions/private/` that require external modules.
+[Build-PSModule](https://github.com/PSModule/Build-PSModule) collects every `#Requires -Modules` declaration across all
+source files, de-duplicates the list, and writes it into the `RequiredModules` field of the compiled manifest
+automatically. For the full range of supported syntax variants, see the
+[about_Requires](https://learn.microsoft.com/en-us/powershell/module/microsoft.powershell.core/about/about_requires)
+documentation.
+
+> [!IMPORTANT]
+> Adding `RequiredModules` to `src/manifest.psd1` is **not** supported for this purpose. Those entries are silently
+> ignored by the build and will not appear in the compiled manifest. Use `#Requires -Modules` in function files instead.
+
 ## Principles and practices
 
 The contribution and release process is based on the idea that a PR is a release, and we only maintain a single linear ancestry of versions, not going
@@ -965,6 +980,9 @@ For each topic or feature to add to the release, open a new branch representing
 branch. Optionally add the `Prerelease` label on the PR for the release branch, to release preview versions before merging and releasing a published
 version of the PowerShell module.
 
+Co-locate concerns for long-term maintainability. For example, `#Requires -Modules` statements belong in the function files that use them, not in a
+central manifest — this makes it immediately visible which functions drive each external dependency, and avoids silent drift between the manifest and
+the actual code.
 
 The process is compatible with: