diff --git a/CHANGES.md b/CHANGES.md
index 598437208..51c0e71a9 100644
--- a/CHANGES.md
+++ b/CHANGES.md
@@ -22,6 +22,7 @@
 
 ### Changed
 
+- Bump lockfile version to 0.3 (#285, @NathanReb)
 - Mark packages to be pulled by opam-monorepo with the `vendor` variable so
   using OPAM with `opam install --deps-only --locked .` will not install
   packages that will be installed with `opam-monorepo pull` (#237,
@@ -38,6 +39,8 @@
 
 ### Removed
 
+- Drop support for lockfile versions 0.2 and lower (#285, @NathanReb)
+
 ### Security
 
 ## 0.2.7
diff --git a/lib/lockfile.ml b/lib/lockfile.ml
index 7f067f4cf..0eafd3b36 100644
--- a/lib/lockfile.ml
+++ b/lib/lockfile.ml
@@ -20,7 +20,12 @@ end
 module Version = struct
   type t = int * int
 
-  let current = (0, 2)
+  let compare (major, minor) (major', minor') =
+    match Ordering.of_int (Int.compare major major') with
+    | Eq -> Ordering.of_int (Int.compare minor minor')
+    | ordering -> ordering
+
+  let current = (0, 3)
   let pp fmt (major, minor) = Format.fprintf fmt "%d.%d" major minor
   let to_string (major, minor) = Printf.sprintf "%d.%d" major minor
 
@@ -35,19 +40,20 @@ module Version = struct
         | Some major, Some minor -> Ok (major, minor)
         | _ -> err ())
 
-  let backward_compatible (major, minor) (major', minor') =
-    major = major' && minor >= minor'
-
   let compatible t =
-    (* We still support 0.1 lockfiles but we'll need to update that if we stop doing so *)
-    if backward_compatible current t then Ok ()
-    else
-      Error
-        (`Msg
-          (Format.asprintf
-             "Incompatible opam-monorepo lockfile version %a. Please upgrade \
-              your opam-monorepo plugin."
-             pp t))
+    match compare current t with
+    | Eq -> Ok ()
+    | Lt ->
+        Rresult.R.error_msgf
+          "Incompatible opam-monorepo lockfile version %a. Please upgrade your \
+           opam-monorepo plugin."
+          pp t
+    | Gt ->
+        Rresult.R.error_msgf
+          "opam-monorepo lockfile version %a is too old. Please regenerate the \
+           lockfile using your current opam-monorepo plugin or install an \
+           older version of the plugin."
+          pp t
 
   let to_opam_value t = Opam.Value.String.to_value (to_string t)
 
diff --git a/test/bin/lockfile-version.t/lockfile-version.opam b/test/bin/lockfile-version.t/lockfile-version.opam
new file mode 100644
index 000000000..8272969cf
--- /dev/null
+++ b/test/bin/lockfile-version.t/lockfile-version.opam
@@ -0,0 +1,8 @@
+opam-version: "2.0"
+depends: [
+  "ocaml"
+  "dune"
+]
+x-opam-monorepo-opam-repositories: [
+  "file://$OPAM_MONOREPO_CWD/minimal-repo"
+]
diff --git a/test/bin/lockfile-version.t/run.t b/test/bin/lockfile-version.t/run.t
new file mode 100644
index 000000000..84c6337b1
--- /dev/null
+++ b/test/bin/lockfile-version.t/run.t
@@ -0,0 +1,24 @@
+We have a simple project with a single package that we will use to generate
+a lockfile for our current version.
+
+  $ gen-minimal-repo
+  $ opam-monorepo lock > /dev/null
+  $ opam show --no-lint --raw -fx-opam-monorepo-version ./lockfile-version.opam.locked
+  "0.3"
+
+This is our current version.
+At the moment we are not backward compatible so if we downgrade this version number,
+pull will refuse the lockfile and suggest it is regenerated with the current plugin:
+
+  $ sed -i "s/x-opam-monorepo-version: \"0.3\"/x-opam-monorepo-version: \"0.2\"/" lockfile-version.opam.locked
+  $ opam-monorepo pull > /dev/null
+  opam-monorepo: [ERROR] opam-monorepo lockfile version 0.2 is too old. Please regenerate the lockfile using your current opam-monorepo plugin or install an older version of the plugin.
+  [1]
+
+We also obviously do not support future versions and they should be rejected as well,
+suggesting that the user upgrade their plugin to be able to interpret that lockfile:
+
+  $ sed -i "s/x-opam-monorepo-version: \"0.2\"/x-opam-monorepo-version: \"0.999\"/" lockfile-version.opam.locked
+  $ opam-monorepo pull > /dev/null
+  opam-monorepo: [ERROR] Incompatible opam-monorepo lockfile version 0.999. Please upgrade your opam-monorepo plugin.
+  [1]
diff --git a/test/bin/simple-lock.t/run.t b/test/bin/simple-lock.t/run.t
index 978700f18..fc401da24 100644
--- a/test/bin/simple-lock.t/run.t
+++ b/test/bin/simple-lock.t/run.t
@@ -67,4 +67,4 @@ The lockfile should contain the base packages, dune and our 2 dependencies
     "file://$OPAM_MONOREPO_CWD/minimal-repo" "file://$OPAM_MONOREPO_CWD/repo"
   ]
   x-opam-monorepo-root-packages: ["a"]
-  x-opam-monorepo-version: "0.2"
+  x-opam-monorepo-version: "0.3"