diff --git a/.all-contributorsrc b/.all-contributorsrc
index 6826ad2c..da919087 100644
--- a/.all-contributorsrc
+++ b/.all-contributorsrc
@@ -103,6 +103,15 @@
         "contributions": [
           "maintenance"
         ]
+      },
+      {
+        "login": "Abelarm",
+        "name": "Luigi Giugliano",
+        "avatar_url": "https://avatars.githubusercontent.com/u/6976921?v=4",
+        "profile": "https://github.com/Abelarm",
+        "contributions": [
+          "code"
+        ]
       }
   ],
   "projectName": "skbase",
diff --git a/skbase/utils/dependencies/_dependencies.py b/skbase/utils/dependencies/_dependencies.py
index 2e1fda15..cf71888a 100644
--- a/skbase/utils/dependencies/_dependencies.py
+++ b/skbase/utils/dependencies/_dependencies.py
@@ -236,7 +236,9 @@ def _get_pkg_version(package_name):
     return pkg_env_version
 
 
-def _check_python_version(obj, package=None, msg=None, severity="error"):
+def _check_python_version(
+    obj, package=None, msg=None, severity="error", prereleases=True
+):
     """Check if system python version is compatible with requirements of obj.
 
     Parameters
@@ -259,6 +261,13 @@ def _check_python_version(obj, package=None, msg=None, severity="error"):
         * "none" - does not raise exception or warning
           function returns False if one of packages is not installed, otherwise True
 
+    prereleases: str, default = True
+        Whether prerelease versions are considered compatible.
+        If True, allows prerelease versions to be considered compatible.
+        If False, always considers prerelease versions as incompatible, i.e., always
+        raises error, warning, or returns False, if the system python version is a
+        prerelease.
+
     Returns
     -------
     compatible : bool, whether obj is compatible with system python version
@@ -276,7 +285,7 @@ def _check_python_version(obj, package=None, msg=None, severity="error"):
         return True
 
     try:
-        est_specifier = SpecifierSet(est_specifier_tag)
+        est_specifier = SpecifierSet(est_specifier_tag, prereleases=prereleases)
     except InvalidSpecifier:
         msg_version = (
             f"wrong format for python_version tag, "
@@ -303,6 +312,9 @@ def _check_python_version(obj, package=None, msg=None, severity="error"):
             f" but system python version is {sys.version}."
         )
 
+        if "rc" in sys_version:
+            msg += " This is due to the release candidate status of your system Python."
+
         if package is not None:
             msg += (
                 f" This is due to python version requirements of the {package} package."
diff --git a/skbase/utils/dependencies/tests/test_check_dependencies.py b/skbase/utils/dependencies/tests/test_check_dependencies.py
index 53f1353f..bbb51737 100644
--- a/skbase/utils/dependencies/tests/test_check_dependencies.py
+++ b/skbase/utils/dependencies/tests/test_check_dependencies.py
@@ -1,9 +1,11 @@
 # -*- coding: utf-8 -*-
 """Tests for _check_soft_dependencies utility."""
+from unittest.mock import patch
+
 import pytest
 from packaging.requirements import InvalidRequirement
 
-from skbase.utils.dependencies._dependencies import _check_soft_dependencies
+from skbase.utils.dependencies import _check_python_version, _check_soft_dependencies
 
 
 def test_check_soft_deps():
@@ -47,3 +49,53 @@ def test_check_soft_deps():
         assert _check_soft_dependencies(
             ("pytest", "!!numpy<~><>0.1.0"), severity="none"
         )
+
+
+@patch("skbase.utils.dependencies._dependencies.sys")
+@pytest.mark.parametrize(
+    "mock_release_version, prereleases, expect_exception",
+    [
+        (True, True, False),
+        (True, False, True),
+        (False, False, False),
+        (False, True, False),
+    ],
+)
+def test_check_python_version(
+    mock_sys, mock_release_version, prereleases, expect_exception
+):
+    from skbase.base import BaseObject
+
+    if mock_release_version:
+        mock_sys.version = "3.8.1rc"
+    else:
+        mock_sys.version = "3.8.1"
+
+    class DummyObjectClass(BaseObject):
+        _tags = {
+            "python_version": ">=3.7.1",  # PEP 440 version specifier, e.g., ">=3.7"
+            "python_dependencies": None,  # PEP 440 dependency strs, e.g., "pandas>=1.0"
+            "env_marker": None,  # PEP 508 environment marker, e.g., "os_name=='posix'"
+        }
+        """Define dummy class to test set_tags."""
+
+    dummy_object_instance = DummyObjectClass()
+
+    try:
+        _check_python_version(dummy_object_instance, prereleases=prereleases)
+    except ModuleNotFoundError as exception:
+        expected_msg = (
+            f"{type(dummy_object_instance).__name__} requires python version "
+            f"to be {dummy_object_instance.get_tags()['python_version']}, "
+            f"but system python version is {mock_sys.version}. "
+            "This is due to the release candidate status of your system Python."
+        )
+
+        if not expect_exception or exception.msg != expected_msg:
+            # Throw Error since exception is not expected or has not the correct message
+            raise AssertionError(
+                "ModuleNotFoundError should be NOT raised by:",
+                f"\n\t - mock_release_version: {mock_release_version},",
+                f"\n\t - prereleases: {prereleases},",
+                f"\nERROR MESSAGE: {exception.msg}",
+            ) from exception