diff --git a/config/config.go b/config/config.go
index fae135dec..e6cd2a8c3 100644
--- a/config/config.go
+++ b/config/config.go
@@ -220,6 +220,7 @@ func (c *Config) Validate() error {
 	modules := make(map[string]*Module)
 	dupped := make(map[string]struct{})
 	for _, m := range c.Modules {
+		// Check for duplicates
 		if _, ok := modules[m.Id()]; ok {
 			if _, ok := dupped[m.Id()]; !ok {
 				dupped[m.Id()] = struct{}{}
@@ -230,6 +231,23 @@ func (c *Config) Validate() error {
 			}
 		}
 
+		// If we haven't seen this module before, check that the
+		// source has no interpolations.
+		if _, ok := modules[m.Id()]; !ok {
+			rc, err := NewRawConfig(map[string]interface{}{
+				"root": m.Source,
+			})
+			if err != nil {
+				errs = append(errs, fmt.Errorf(
+					"%s: module source error: %s",
+					m.Id(), err))
+			} else if len(rc.Interpolations) > 0 {
+				errs = append(errs, fmt.Errorf(
+					"%s: module source cannot contain interpolations",
+					m.Id()))
+			}
+		}
+
 		modules[m.Id()] = m
 	}
 	dupped = nil
diff --git a/config/config_test.go b/config/config_test.go
index e4892a277..f5208b032 100644
--- a/config/config_test.go
+++ b/config/config_test.go
@@ -123,6 +123,13 @@ func TestConfigValidate_dupResource(t *testing.T) {
 	}
 }
 
+func TestConfigValidate_moduleSourceVar(t *testing.T) {
+	c := testConfig(t, "validate-module-source-var")
+	if err := c.Validate(); err == nil {
+		t.Fatal("should not be valid")
+	}
+}
+
 func TestConfigValidate_nil(t *testing.T) {
 	var c Config
 	if err := c.Validate(); err != nil {
diff --git a/config/test-fixtures/validate-module-source-var/main.tf b/config/test-fixtures/validate-module-source-var/main.tf
new file mode 100644
index 000000000..ee3bda608
--- /dev/null
+++ b/config/test-fixtures/validate-module-source-var/main.tf
@@ -0,0 +1,3 @@
+module "foo" {
+    source = "${path.cwd}/foo"
+}