diff --git a/internal/configs/module_merge.go b/internal/configs/module_merge.go
index 014d2329c..7dc380114 100644
--- a/internal/configs/module_merge.go
+++ b/internal/configs/module_merge.go
@@ -56,6 +56,10 @@ func (v *Variable) merge(ov *Variable) hcl.Diagnostics {
 	if ov.ParsingMode != 0 {
 		v.ParsingMode = ov.ParsingMode
 	}
+	if ov.NullableSet {
+		v.Nullable = ov.Nullable
+		v.NullableSet = ov.NullableSet
+	}
 
 	// If the override file overrode type without default or vice-versa then
 	// it may have created an invalid situation, which we'll catch now by
@@ -100,6 +104,16 @@ func (v *Variable) merge(ov *Variable) hcl.Diagnostics {
 		} else {
 			v.Default = val
 		}
+
+		// ensure a null default wasn't merged in when it is not allowed
+		if !v.Nullable && v.Default.IsNull() {
+			diags = append(diags, &hcl.Diagnostic{
+				Severity: hcl.DiagError,
+				Summary:  "Invalid default value for variable",
+				Detail:   "A null default value is not valid when nullable=false.",
+				Subject:  &ov.DeclRange,
+			})
+		}
 	}
 
 	return diags
diff --git a/internal/configs/module_merge_test.go b/internal/configs/module_merge_test.go
index d6df20381..d95e62c3c 100644
--- a/internal/configs/module_merge_test.go
+++ b/internal/configs/module_merge_test.go
@@ -24,7 +24,8 @@ func TestModuleOverrideVariable(t *testing.T) {
 			Description:    "b_override description",
 			DescriptionSet: true,
 			Default:        cty.StringVal("b_override"),
-			Nullable:       true,
+			Nullable:       false,
+			NullableSet:    true,
 			Type:           cty.String,
 			ConstraintType: cty.String,
 			ParsingMode:    VariableParseLiteral,
@@ -48,6 +49,7 @@ func TestModuleOverrideVariable(t *testing.T) {
 			DescriptionSet: true,
 			Default:        cty.StringVal("b_override partial"),
 			Nullable:       true,
+			NullableSet:    false,
 			Type:           cty.String,
 			ConstraintType: cty.String,
 			ParsingMode:    VariableParseLiteral,
diff --git a/internal/configs/named_values.go b/internal/configs/named_values.go
index 8f3db453e..9dcd10b40 100644
--- a/internal/configs/named_values.go
+++ b/internal/configs/named_values.go
@@ -39,7 +39,8 @@ type Variable struct {
 	// Nullable indicates that null is a valid value for this variable. Setting
 	// Nullable to false means that the module can expect this variable to
 	// never be null.
-	Nullable bool
+	Nullable    bool
+	NullableSet bool
 
 	DeclRange hcl.Range
 }
@@ -118,6 +119,7 @@ func decodeVariableBlock(block *hcl.Block, override bool) (*Variable, hcl.Diagno
 	if attr, exists := content.Attributes["nullable"]; exists {
 		valDiags := gohcl.DecodeExpression(attr.Expr, nil, &v.Nullable)
 		diags = append(diags, valDiags...)
+		v.NullableSet = true
 	} else {
 		// The current default is true, which is subject to change in a future
 		// language edition.
diff --git a/internal/configs/testdata/valid-modules/override-variable/b_override.tf b/internal/configs/testdata/valid-modules/override-variable/b_override.tf
index 21dbe82e9..f09ce5380 100644
--- a/internal/configs/testdata/valid-modules/override-variable/b_override.tf
+++ b/internal/configs/testdata/valid-modules/override-variable/b_override.tf
@@ -1,4 +1,5 @@
 variable "fully_overridden" {
+  nullable = false
   default = "b_override"
   description = "b_override description"
   type = string