I've created a blank React project, using the command: npx create-react-app on npm v7.0.7 and Node.js v15.0.1

Installed:

• React v17.0.1,
• node-sass v5.0.0,

Then I tried to import a blank .scss file to the App component:

File App.js

import './App.scss'

function App() {
  return (
    <div className="App">
      App
    </div>
  );
}

export default App;

It throws an error:

Failed to compile.

./src/App.scss (./node_modules/css-loader/dist/cjs.js??ref--5-oneOf-6-1!./node_modules/postcss-loader/src??postcss!./node_modules/resolve-url-loader??ref--5-oneOf-6-3!./node_modules/s
ass-loader/dist/cjs.js??ref--5-oneOf-6-4!./src/App.scss)
Error: Node Sass version 5.0.0 is incompatible with ^4.0.0.

File package.json

{
  "name": "react-17-node-sass-5",
  "version": "0.1.0",
  "private": true,
  "dependencies": {
    "@testing-library/jest-dom": "^5.11.5",
    "@testing-library/react": "^11.1.0",
    "@testing-library/user-event": "^12.1.10",
    "node-sass": "^5.0.0",
    "react": "^17.0.1",
    "react-dom": "^17.0.1",
    "react-scripts": "4.0.0",
    "web-vitals": "^0.2.4"
  },
 ...

  }
}