diff --git a/earlydecoder/decoder_test.go b/earlydecoder/decoder_test.go
index 6215c4dc..016160bb 100644
--- a/earlydecoder/decoder_test.go
+++ b/earlydecoder/decoder_test.go
@@ -7,6 +7,7 @@ import (
 	"github.com/google/go-cmp/cmp"
 	"github.com/hashicorp/go-version"
 	"github.com/hashicorp/hcl/v2"
+	"github.com/hashicorp/hcl/v2/ext/typeexpr"
 	"github.com/hashicorp/hcl/v2/hclsyntax"
 	tfaddr "github.com/hashicorp/terraform-registry-address"
 	"github.com/hashicorp/terraform-schema/backend"
@@ -811,6 +812,42 @@ variable "name" {
 			},
 			nil,
 		},
+		{
+			"variables with optional type values",
+			`
+variable "name" {
+  type = object({
+    foo = optional(string, "food")
+    bar = optional(number)
+  })
+}`,
+			&module.Meta{
+				Path:                 path,
+				ProviderReferences:   map[module.ProviderRef]tfaddr.Provider{},
+				ProviderRequirements: map[tfaddr.Provider]version.Constraints{},
+				Variables: map[string]module.Variable{
+					"name": {
+						Type: cty.Object(map[string]cty.Type{
+							"foo": cty.String,
+							"bar": cty.Number,
+						}),
+						TypeDefaults: &typeexpr.Defaults{
+							Type: cty.Object(map[string]cty.Type{
+								"foo": cty.String,
+								"bar": cty.Number,
+							}),
+							DefaultValues: map[string]cty.Value{
+								"foo": cty.StringVal("food"),
+							},
+						},
+					},
+				},
+				Outputs:     map[string]module.Output{},
+				Filenames:   []string{"test.tf"},
+				ModuleCalls: map[string]module.DeclaredModuleCall{},
+			},
+			nil,
+		},
 		{
 			"empty output",
 			`
diff --git a/earlydecoder/load_module.go b/earlydecoder/load_module.go
index f2e0982e..583c1c8d 100644
--- a/earlydecoder/load_module.go
+++ b/earlydecoder/load_module.go
@@ -214,8 +214,9 @@ func loadModuleFromFile(file *hcl.File, mod *decodedModule) hcl.Diagnostics {
 				diags = append(diags, valDiags...)
 			}
 			varType := cty.DynamicPseudoType
+			var defaults *typeexpr.Defaults
 			if attr, defined := content.Attributes["type"]; defined {
-				varType, valDiags = typeexpr.TypeConstraint(attr.Expr)
+				varType, defaults, valDiags = typeexpr.TypeConstraintWithDefaults(attr.Expr)
 				diags = append(diags, valDiags...)
 			}
 			if attr, defined := content.Attributes["sensitive"]; defined {
@@ -239,6 +240,7 @@ func loadModuleFromFile(file *hcl.File, mod *decodedModule) hcl.Diagnostics {
 							val = cty.DynamicVal
 						}
 					}
+
 					defaultValue = val
 				}
 			}
@@ -247,6 +249,7 @@ func loadModuleFromFile(file *hcl.File, mod *decodedModule) hcl.Diagnostics {
 				Description:  description,
 				IsSensitive:  isSensitive,
 				DefaultValue: defaultValue,
+				TypeDefaults: defaults,
 			}
 		case "output":
 			content, _, contentDiags := block.Body.PartialContent(outputSchema)
diff --git a/module/variable.go b/module/variable.go
index 856ab370..a996e021 100644
--- a/module/variable.go
+++ b/module/variable.go
@@ -1,6 +1,7 @@
 package module
 
 import (
+	"github.com/hashicorp/hcl/v2/ext/typeexpr"
 	"github.com/zclconf/go-cty/cty"
 )
 
@@ -15,4 +16,11 @@ type Variable struct {
 	// DefaultValue represents default value if one is defined
 	// and is decodable without errors, else cty.NilVal
 	DefaultValue cty.Value
+
+	// TypeDefaults represents any default values for optional object
+	// attributes assuming Type is of cty.Object and has defaults.
+	//
+	// Any relationships between DefaultValue & TypeDefaults are left
+	// for downstream to deal with using e.g. TypeDefaults.Apply().
+	TypeDefaults *typeexpr.Defaults
 }