diff --git a/pygmt/src/grdhisteq.py b/pygmt/src/grdhisteq.py
index c12199fe717..09555d05e94 100644
--- a/pygmt/src/grdhisteq.py
+++ b/pygmt/src/grdhisteq.py
@@ -141,7 +141,7 @@ def _grdhisteq(grid, output_type, **kwargs):
     def equalize_grid(
         grid,
         *,
-        outgrid=True,
+        outgrid=None,
         divisions=None,
         region=None,
         gaussian=None,
@@ -163,7 +163,7 @@ def equalize_grid(
         ----------
         grid : str or xarray.DataArray
             The file name of the input grid or the grid loaded as a DataArray.
-        outgrid : str or bool or None
+        outgrid : str or None
             The name of the output netCDF file with extension .nc to store the
             grid in.
         divisions : int
@@ -183,7 +183,7 @@ def equalize_grid(
         ret: xarray.DataArray or None
             Return type depends on the ``outgrid`` parameter:
 
-            - xarray.DataArray if ``outgrid`` is True or None
+            - xarray.DataArray if ``outgrid`` is None
             - None if ``outgrid`` is a str (grid output is stored in
               ``outgrid``)
 
@@ -211,9 +211,11 @@ def equalize_grid(
         with GMTTempFile(suffix=".nc") as tmpfile:
             if isinstance(outgrid, str):
                 output_type = "file"
-            else:
+            elif outgrid is None:
                 output_type = "xarray"
                 outgrid = tmpfile.name
+            else:
+                raise GMTInvalidInput("Must specify 'outgrid' as a string or None.")
             return grdhisteq._grdhisteq(
                 grid=grid,
                 output_type=output_type,
@@ -281,12 +283,13 @@ def compute_bins(
 
         Returns
         -------
-        ret: pandas.DataFrame or None
-            Return type depends on the ``outfile`` parameter:
+        ret : pandas.DataFrame or numpy.ndarray or None
+            Return type depends on ``outfile`` and ``output_type``:
 
-            - pandas.DataFrame if ``outfile`` is True or None
-            - None if ``outfile`` is a str (file output is stored in
+            - None if ``outfile`` is set (output will be stored in file set by
               ``outfile``)
+            - :class:`pandas.DataFrame` or :class:`numpy.ndarray` if
+              ``outfile`` is not set (depends on ``output_type``)
 
         Example
         -------
diff --git a/pygmt/tests/test_grdhisteq.py b/pygmt/tests/test_grdhisteq.py
index 9a4fd004b3d..a812e0d5565 100644
--- a/pygmt/tests/test_grdhisteq.py
+++ b/pygmt/tests/test_grdhisteq.py
@@ -66,13 +66,12 @@ def test_equalize_grid_outgrid_file(grid, expected_grid, region):
         xr.testing.assert_allclose(a=temp_grid, b=expected_grid)
 
 
-@pytest.mark.parametrize("outgrid", [True, None])
-def test_equalize_grid_outgrid(grid, outgrid, expected_grid, region):
+def test_equalize_grid_outgrid(grid, expected_grid, region):
     """
-    Test grdhisteq.equalize_grid with ``outgrid=True`` and ``outgrid=None``.
+    Test grdhisteq.equalize_grid with ``outgrid=None``.
     """
     temp_grid = grdhisteq.equalize_grid(
-        grid=grid, divisions=2, region=region, outgrid=outgrid
+        grid=grid, divisions=2, region=region, outgrid=None
     )
     assert temp_grid.gmt.gtype == 1  # Geographic grid
     assert temp_grid.gmt.registration == 1  # Pixel registration
@@ -135,3 +134,11 @@ def test_compute_bins_invalid_format(grid):
         grdhisteq.compute_bins(grid=grid, output_type=1)
     with pytest.raises(GMTInvalidInput):
         grdhisteq.compute_bins(grid=grid, output_type="pandas", header="o+c")
+
+
+def test_equalize_grid_invalid_format(grid):
+    """
+    Test that equalize_grid fails with incorrect format.
+    """
+    with pytest.raises(GMTInvalidInput):
+        grdhisteq.equalize_grid(grid=grid, outgrid=True)