diff --git a/packages/cli/src/update.js b/packages/cli/src/update.js
index 22f406592..74b20d5d0 100644
--- a/packages/cli/src/update.js
+++ b/packages/cli/src/update.js
@@ -9,6 +9,10 @@ import { getPackageJSON } from '@percy/cli-command/utils';
 const CACHE_FILE = path.resolve(url.fileURLToPath(import.meta.url), '../../.releases');
 // max age the cache should be used for (3 days)
 const CACHE_MAX_AGE = 3 * 24 * 60 * 60 * 1000;
+// how many stable releases behind before the warning escalates
+const MANY_RELEASES_BEHIND = 10;
+// where users are pointed to see what changed
+const RELEASES_URL = 'https://github.com/percy/cli/releases';
 
 // Safely read from CACHE_FILE and return an object containing `data` mirroring what was previously
 // written using `writeToCache(data)`. An empty object is returned when older than CACHE_MAX_AGE,
@@ -44,12 +48,44 @@ function writeToCache(data) {
   }
 }
 
+// Parse a version string into its comparable parts. Release tags are inconsistently prefixed with
+// a `v`, so the prefix is optional. Returns null for anything unparseable so callers can bail out
+// rather than warn about a comparison that cannot be trusted.
+function parseVersion(version) {
+  let match = /^v?(\d+)\.(\d+)\.(\d+)(?:-([\w.-]+))?$/.exec(String(version).trim());
+  if (!match) return null;
+
+  return {
+    major: parseInt(match[1], 10),
+    minor: parseInt(match[2], 10),
+    patch: parseInt(match[3], 10),
+    prerelease: match[4] || null,
+    // a prerelease precedes the stable release of the same version, so it sorts lower
+    stable: match[4] ? 0 : 1,
+    // the version without any `v` prefix, for display
+    version: match[0].replace(/^v/, '')
+  };
+}
+
+// Compare two parsed versions, returning a negative number when `a` precedes `b`, a positive
+// number when it follows, and zero when they are equal. Prerelease identifiers are not compared
+// against each other, since only stable releases are ever compared - the sole prerelease involved
+// is the version currently installed, and a prerelease always precedes its own stable release.
+function compareVersions(a, b) {
+  for (let part of ['major', 'minor', 'patch', 'stable']) {
+    if (a[part] !== b[part]) return a[part] - b[part];
+  }
+
+  return 0;
+}
+
 // Fetch and return release information for @percy/cli.
 async function fetchReleases(pkg) {
   let { request } = await import('@percy/client/utils');
 
-  // fetch releases from the github api without retries
-  let api = 'https://api.github.com/repos/percy/cli/releases';
+  // fetch releases from the github api without retries. a full page is requested since the majority
+  // of releases are prereleases, and those are filtered out before comparing versions
+  let api = 'https://api.github.com/repos/percy/cli/releases?per_page=100';
   let data = await request(api, {
     headers: { 'User-Agent': pkg.name },
     retries: 0
@@ -78,19 +114,63 @@ export async function checkForUpdate() {
     // request new release information if needed
     if (!releases) {
       releases = await fetchReleases(pkg);
-      if (!cacheError) writeToCache(releases, log);
+      if (!cacheError) writeToCache(releases);
+    }
+
+    let current = parseVersion(pkg.version);
+
+    if (!current) {
+      log.debug(`Unable to parse the current version: ${pkg.version}`);
+      return;
+    }
+
+    // only compare against stable releases - alpha/beta versions are excluded both by the release
+    // flag and by their own version, since the flag is set by hand and is sometimes wrong
+    let versions = releases.reduce((acc, r) => {
+      let parsed = !r.prerelease && parseVersion(r.tag);
+      if (parsed && !parsed.prerelease) acc.push(parsed);
+      return acc;
+    }, []);
+
+    if (!versions.length) {
+      log.debug('No stable releases found to compare against');
+      return;
+    }
+
+    // sort newest first rather than trusting the order releases were published in
+    versions.sort((a, b) => compareVersions(b, a));
+    let [latest] = versions;
+
+    // already on the latest stable release, or ahead of it - nothing to warn about
+    if (compareVersions(current, latest) >= 0) {
+      log.debug(`Current version ${current.version} is up to date (latest is ${latest.version})`);
+      return;
+    }
+
+    // a prerelease is intentionally not the latest stable release, so counting releases behind is
+    // meaningless. say what it actually is and what the latest stable release is instead
+    if (current.prerelease) {
+      log.warn('\nYou are using a pre-release build of @percy/cli. ' +
+        `${colors.red(current.version)} -> ${colors.green(latest.version)} (latest stable)\n`);
+      return;
     }
 
-    // check the current package version against released versions
-    // don't include prerelease - alpha/beta versions
-    let versions = releases.filter(r => !r.prerelease).map(r => r.tag.substr(1));
-    let age = versions.indexOf(pkg.version);
+    // the number of stable releases newer than the current one. this is only a real count when the
+    // current version falls within the window of releases fetched - otherwise it is a lower bound,
+    // and reporting a lower bound as though it were exact is what made this warning misleading
+    let behind = versions.filter(v => compareVersions(v, current) > 0).length;
+    let known = compareVersions(current, versions[versions.length - 1]) >= 0;
+    let versionChange = `${colors.red(current.version)} -> ${colors.green(latest.version)}`;
 
-    // a new version is available
-    if (age !== 0) {
-      log.warn(`\n${age > 0 && age < 10 ? 'A new version of @percy/cli is available!' : (
-        'Heads up! The current version of @percy/cli is more than 10 releases behind!'
-      )} ${colors.red(pkg.version)} -> ${colors.green(versions[0])}\n`);
+    if (!known) {
+      log.warn('\nHeads up! Your @percy/cli is significantly out of date. ' +
+        `${versionChange}\nSee ${RELEASES_URL} for what changed.\n`);
+    } else if (behind >= MANY_RELEASES_BEHIND || current.major < latest.major) {
+      log.warn(`\nHeads up! Your @percy/cli is ${behind} ${behind === 1 ? 'release' : 'releases'} ` +
+        `behind the latest release. ${versionChange}\n` +
+        `See ${RELEASES_URL} for what changed.\n`);
+    } else {
+      log.warn(`\nA new version of @percy/cli is available! ${versionChange}\n`);
     }
   } catch (err) {
     log.debug('Unable to check for updates');
diff --git a/packages/cli/test/update.test.js b/packages/cli/test/update.test.js
index 65cf2db9a..3a8c24011 100644
--- a/packages/cli/test/update.test.js
+++ b/packages/cli/test/update.test.js
@@ -5,9 +5,14 @@ import { checkForUpdate } from '../src/update.js';
 describe('CLI update check', () => {
   let ghAPI;
 
+  // remocks package.json to simulate running a different version of the CLI. this resets the
+  // mocked filesystem, so it must be called before mocking the update cache
+  async function mockVersion(version) {
+    await mockfs({ './package.json': JSON.stringify({ name: '@percy/cli', version }) });
+  }
+
   beforeEach(async () => {
-    let pkg = { name: '@percy/cli', version: '1.0.0' };
-    await mockfs({ './package.json': JSON.stringify(pkg) });
+    await mockVersion('1.0.0');
     ghAPI = await mockRequests('https://api.github.com');
     await logger.mock();
   });
@@ -84,14 +89,144 @@ describe('CLI update check', () => {
     expect(logger.stderr).toEqual([]);
   });
 
-  it('warns when the current version is outdated', async () => {
+  it('warns with the exact number of releases behind when far behind', async () => {
+    await mockVersion('1.0.0');
+    // 12 stable releases newer than 1.0.0, with 1.0.0 itself inside the fetched window
+    mockUpdateCache([
+      ...Array.from({ length: 12 }, (_, i) => ({ tag: `v1.0.${12 - i}` })),
+      { tag: 'v1.0.0' }
+    ]);
+
+    await checkForUpdate();
+    expect(logger.stdout).toEqual([]);
+    expect(logger.stderr).toEqual([
+      '\n[percy] Heads up! Your @percy/cli is 12 releases behind the latest release. ' +
+        '1.0.0 -> 1.0.12\nSee https://github.com/percy/cli/releases for what changed.\n'
+    ]);
+  });
+
+  it('escalates the warning when a major version behind, even by one release', async () => {
+    await mockVersion('1.0.0');
+    mockUpdateCache([{ tag: 'v2.0.0' }, { tag: 'v1.0.0' }]);
+
+    await checkForUpdate();
+    expect(logger.stdout).toEqual([]);
+    expect(logger.stderr).toEqual([
+      '\n[percy] Heads up! Your @percy/cli is 1 release behind the latest release. ' +
+        '1.0.0 -> 2.0.0\nSee https://github.com/percy/cli/releases for what changed.\n'
+    ]);
+  });
+
+  it('warns without a count when the current version predates every fetched release', async () => {
+    await mockVersion('1.0.0');
     mockUpdateCache([{ tag: 'v2.0.2', prerelease: true }, { tag: 'v2.0.1', prerelease: false }, { tag: 'v2.0.0', prerelease: true }]);
 
     await checkForUpdate();
     expect(logger.stdout).toEqual([]);
     expect(logger.stderr).toEqual([
-      '\n[percy] Heads up! The current version of @percy/cli ' +
-        'is more than 10 releases behind! 1.0.0 -> 2.0.1\n'
+      '\n[percy] Heads up! Your @percy/cli is significantly out of date. 1.0.0 -> 2.0.1\n' +
+        'See https://github.com/percy/cli/releases for what changed.\n'
+    ]);
+  });
+
+  it('warns that a pre-release is in use rather than counting releases behind', async () => {
+    await mockVersion('1.1.0-beta.3');
+    mockUpdateCache([
+      { tag: 'v1.1.0' },
+      { tag: 'v1.1.0-beta.3', prerelease: true },
+      { tag: 'v1.0.0' }
+    ]);
+
+    await checkForUpdate();
+    expect(logger.stdout).toEqual([]);
+    expect(logger.stderr).toEqual([
+      '\n[percy] You are using a pre-release build of @percy/cli. ' +
+        '1.1.0-beta.3 -> 1.1.0 (latest stable)\n'
+    ]);
+  });
+
+  it('does not warn when a pre-release is ahead of the latest stable release', async () => {
+    await mockVersion('1.2.0-beta.0');
+    mockUpdateCache([{ tag: 'v1.1.0' }, { tag: 'v1.0.0' }]);
+
+    await checkForUpdate();
+    expect(logger.stdout).toEqual([]);
+    expect(logger.stderr).toEqual([]);
+  });
+
+  it('does not warn when the current version is ahead of the latest release', async () => {
+    await mockVersion('1.2.0');
+    mockUpdateCache([{ tag: 'v1.1.0' }, { tag: 'v1.0.0' }]);
+
+    await checkForUpdate();
+    expect(logger.stdout).toEqual([]);
+    expect(logger.stderr).toEqual([]);
+  });
+
+  it('compares releases by version rather than by the order they were published', async () => {
+    await mockVersion('1.1.0');
+    // a backported patch published after the newest release
+    mockUpdateCache([{ tag: 'v1.0.1' }, { tag: 'v1.2.0' }, { tag: 'v1.1.0' }]);
+
+    await checkForUpdate();
+    expect(logger.stdout).toEqual([]);
+    expect(logger.stderr).toEqual([
+      '\n[percy] A new version of @percy/cli is available! 1.1.0 -> 1.2.0\n'
+    ]);
+  });
+
+  it('handles release tags that are not prefixed with a v', async () => {
+    await mockVersion('1.0.0');
+    mockUpdateCache([{ tag: '1.1.0' }, { tag: '1.0.0' }]);
+
+    await checkForUpdate();
+    expect(logger.stdout).toEqual([]);
+    expect(logger.stderr).toEqual([
+      '\n[percy] A new version of @percy/cli is available! 1.0.0 -> 1.1.0\n'
+    ]);
+  });
+
+  it('ignores releases whose tags are prereleases regardless of the release flag', async () => {
+    await mockVersion('1.0.0');
+    // the prerelease flag is set by hand when publishing and is sometimes wrong
+    mockUpdateCache([{ tag: 'v1.1.0-beta.1', prerelease: false }, { tag: 'v1.0.0' }]);
+
+    await checkForUpdate();
+    expect(logger.stdout).toEqual([]);
+    expect(logger.stderr).toEqual([]);
+  });
+
+  it('does not warn when no stable releases are found', async () => {
+    logger.loglevel('debug');
+    mockUpdateCache([{ tag: 'v1.1.0', prerelease: true }]);
+
+    await checkForUpdate();
+    expect(logger.stdout).toEqual([]);
+    expect(logger.stderr).toEqual([
+      '[percy:cli:update] No stable releases found to compare against'
+    ]);
+  });
+
+  it('does not warn when the current version cannot be parsed', async () => {
+    await mockVersion('not-a-version');
+    mockUpdateCache([{ tag: 'v1.1.0' }]);
+    logger.loglevel('debug');
+
+    await checkForUpdate();
+    expect(logger.stdout).toEqual([]);
+    expect(logger.stderr).toEqual([
+      '[percy:cli:update] Unable to parse the current version: not-a-version'
+    ]);
+  });
+
+  it('ignores release tags that cannot be parsed', async () => {
+    await mockVersion('1.0.0');
+    mockUpdateCache([{ tag: 'nightly' }, { tag: 'v1.1.0' }, { tag: 'v1.0.0' }]);
+
+    await checkForUpdate();
+    expect(logger.stdout).toEqual([]);
+    expect(logger.stderr).toEqual([
+      '\n[percy] A new version of @percy/cli is available! 1.0.0 -> 1.1.0\n'
     ]);
   });
 
@@ -110,7 +245,8 @@ describe('CLI update check', () => {
     expect(logger.stdout).toEqual([]);
     expect(logger.stderr).toEqual([
       '[percy:cli:update:cache] Unable to read from cache',
-      jasmine.stringContaining('[percy:cli:update:cache] Error: EACCES')
+      jasmine.stringContaining('[percy:cli:update:cache] Error: EACCES'),
+      '[percy:cli:update] Current version 1.0.0 is up to date (latest is 1.0.0)'
     ]);
 
     expect(ghAPI).toHaveBeenCalled();
@@ -130,7 +266,8 @@ describe('CLI update check', () => {
     expect(logger.stdout).toEqual([]);
     expect(logger.stderr).toEqual([
       '[percy:cli:update:cache] Unable to write to cache',
-      jasmine.stringContaining('[percy:cli:update:cache] Error: EACCES')
+      jasmine.stringContaining('[percy:cli:update:cache] Error: EACCES'),
+      '[percy:cli:update] Current version 1.0.0 is up to date (latest is 1.0.0)'
     ]);
 
     expect(ghAPI).toHaveBeenCalled();