diff --git a/HISTORY.rst b/HISTORY.rst
index 09b76252..8adebc07 100644
--- a/HISTORY.rst
+++ b/HISTORY.rst
@@ -18,6 +18,7 @@ PlatformIO Core 5
 - Fixed an issue when the package manager tries to install a built-in library from the registry (`issue #3662 <https://github.com/platformio/platformio-core/issues/3662>`_)
 - Fixed an issue with incorrect value for C++ language standard in IDE projects when an in-progress language standard is used (`issue #3653 <https://github.com/platformio/platformio-core/issues/3653>`_)
 - Fixed an issue with "Invalid simple block (semantic_version)" from library dependency that refs to an external source (repository, ZIP/Tar archives) (`issue #3658 <https://github.com/platformio/platformio-core/issues/3658>`_)
+- Fixed an issue when can not remove update or remove external dev-platform using PlatformIO Home (`issue #3663 <https://github.com/platformio/platformio-core/issues/3663>`_)
 
 5.0.0 (2020-09-03)
 ~~~~~~~~~~~~~~~~~~
diff --git a/platformio/package/meta.py b/platformio/package/meta.py
index 147a1faf..edc5d0ff 100644
--- a/platformio/package/meta.py
+++ b/platformio/package/meta.py
@@ -209,6 +209,7 @@ class PackageSpec(object):  # pylint: disable=too-many-instance-attributes
         raw = raw.strip()
 
         parsers = (
+            self._parse_local_file,
             self._parse_requirements,
             self._parse_custom_name,
             self._parse_id,
@@ -227,10 +228,16 @@ class PackageSpec(object):  # pylint: disable=too-many-instance-attributes
             # the leftover is a package name
             self.name = raw
 
-    def _parse_requirements(self, raw):
-        if "@" not in raw:
+    @staticmethod
+    def _parse_local_file(raw):
+        if raw.startswith("file://") or not any(c in raw for c in ("/", "\\")):
             return raw
-        if raw.startswith("file://") and os.path.exists(raw[7:]):
+        if os.path.exists(raw):
+            return "file://%s" % raw
+        return raw
+
+    def _parse_requirements(self, raw):
+        if "@" not in raw or raw.startswith("file://"):
             return raw
         tokens = raw.rsplit("@", 1)
         if any(s in tokens[1] for s in (":", "/")):
diff --git a/tests/package/test_meta.py b/tests/package/test_meta.py
index 0629f274..32b3d56a 100644
--- a/tests/package/test_meta.py
+++ b/tests/package/test_meta.py
@@ -90,12 +90,13 @@ def test_spec_local_urls(tmpdir_factory):
     assert PackageSpec("file:///tmp/some-lib/") == PackageSpec(
         url="file:///tmp/some-lib/", name="some-lib"
     )
-    assert PackageSpec("file:///tmp/foo.tar.gz@~2.3.0-beta.1") == PackageSpec(
-        url="file:///tmp/foo.tar.gz", name="foo", requirements="~2.3.0-beta.1"
+    # detached package
+    assert PackageSpec("file:///tmp/some-lib@src-67e1043a673d2") == PackageSpec(
+        url="file:///tmp/some-lib@src-67e1043a673d2", name="some-lib"
     )
-    # detached folder with "@" symbol
+    # detached folder without scheme
     pkg_dir = tmpdir_factory.mktemp("storage").join("detached@1.2.3").mkdir()
-    assert PackageSpec("file://%s" % str(pkg_dir)) == PackageSpec(
+    assert PackageSpec(str(pkg_dir)) == PackageSpec(
         name="detached", url="file://%s" % pkg_dir
     )