diff --git a/internal/command/init2_test.go b/internal/command/init2_test.go
index 6f8e91188af1..3bc5c38929a6 100644
--- a/internal/command/init2_test.go
+++ b/internal/command/init2_test.go
@@ -10,6 +10,10 @@ import (
 	"testing"
 
 	"github.com/hashicorp/cli"
+
+	"github.com/hashicorp/terraform/internal/backend"
+	backendInit "github.com/hashicorp/terraform/internal/backend/init"
+	backendCloud "github.com/hashicorp/terraform/internal/cloud"
 )
 
 func TestInit2_dynamicSourceErrors(t *testing.T) {
@@ -718,3 +722,53 @@ func TestPlan_dynamicModuleVersionMismatch(t *testing.T) {
 		t.Fatalf("wrong error\ngot:\n%s\n\nwant: containing %q", got, want)
 	}
 }
+
+// TestInit_constVarFromCloudBackend verifies that terraform init fetches
+// workspace variables from HCP Terraform to resolve const variables used in
+// dynamic module source expressions, without requiring -var flags.
+func TestInit_constVarFromCloudBackend(t *testing.T) {
+	// Start a mock HCP Terraform server that serves the "test" workspace and
+	// returns module_name=example as a Terraform-category variable.
+	server := cloudTestServerWithVars(t)
+	defer server.Close()
+	d := testDisco(server)
+
+	// Override the "cloud" backend to use our test server.
+	previousBackend := backendInit.Backend("cloud")
+	backendInit.Set("cloud", func() backend.Backend { return backendCloud.New(d) })
+	defer backendInit.Set("cloud", previousBackend)
+
+	// Use the existing fixture: cloud {} block pointing to hashicorp/test,
+	// variable "module_name" { const = true }, module "example" { source = "./modules/${var.module_name}" }
+	wd := tempWorkingDirFixture(t, "dynamic-module-sources/get-const-var-backend")
+	t.Chdir(wd.RootModuleDir())
+
+	ui := cli.NewMockUi()
+	view, done := testView(t)
+	c := &InitCommand{
+		Meta: Meta{
+			testingOverrides: metaOverridesForProvider(testProvider()),
+			Ui:               ui,
+			View:             view,
+			WorkingDir:       wd,
+			Services:         d,
+		},
+	}
+
+	// Run init without any -var flags; module_name should be resolved from the backend.
+	code := c.Run([]string{})
+	output := done(t)
+	if code != 0 {
+		t.Fatalf("expected init to succeed, got exit code %d\n%s", code, output.All())
+	}
+
+	// The module should have been installed into .terraform/modules.
+	moduleDir := filepath.Join(wd.RootModuleDir(), ".terraform", "modules")
+	entries, err := os.ReadDir(moduleDir)
+	if err != nil {
+		t.Fatalf("expected .terraform/modules to exist after init: %s", err)
+	}
+	if len(entries) == 0 {
+		t.Fatal("expected at least one module entry in .terraform/modules after init")
+	}
+}
diff --git a/internal/command/init_run.go b/internal/command/init_run.go
index 228a95416476..8638a59cda61 100644
--- a/internal/command/init_run.go
+++ b/internal/command/init_run.go
@@ -7,6 +7,7 @@ import (
 	"context"
 	"errors"
 	"fmt"
+	"log"
 	"strings"
 
 	"github.com/hashicorp/hcl/v2"
@@ -168,6 +169,19 @@ func (c *InitCommand) run(initArgs *arguments.Init, view views.Init) int {
 	}
 
 	if initArgs.Get {
+		// If the root module declares any const variables that are not yet
+		// satisfied by CLI flags, attempt to fetch them from the configured
+		// backend (e.g. HCP Terraform workspace variables). This is necessary
+		// so that dynamic module source expressions (e.g. `source = var.path`)
+		// can be resolved during module installation below.
+		//
+		// Non-fatal: if the backend isn't reachable yet (e.g. first-time init
+		// before credentials are stored) we proceed and let module installation
+		// fail with a more specific error if needed.
+		if resolveVarDiags := c.resolveConstVariablesForInit(path, initArgs.ViewType); resolveVarDiags.HasErrors() {
+			log.Printf("[WARN] init: failed to resolve const variables from backend: %s", resolveVarDiags.Err())
+		}
+
 		modsOutput, modsAbort, modsDiags := c.getModules(ctx, path, initArgs.TestsDirectory, rootModEarly, initArgs.Upgrade, view)
 		diags = diags.Append(modsDiags)
 		if modsAbort || modsDiags.HasErrors() {
diff --git a/internal/command/meta_backend.go b/internal/command/meta_backend.go
index a8a004c05e77..29775fc9cef0 100644
--- a/internal/command/meta_backend.go
+++ b/internal/command/meta_backend.go
@@ -2138,6 +2138,55 @@ func (m *Meta) backend(configPath string, viewType arguments.ViewType) (backendr
 	return be, diags
 }
 
+// backendForInit is like backend but sets Init: true so it can be used
+// during "terraform init" before the backend has been stored in state.
+// It is restricted to cloud/backend configs only (not state_store) since
+// state_store requires dependency locks that aren't available during init.
+//
+// This is used by resolveConstVariablesForInit to fetch workspace variables
+// early enough for dynamic module source resolution.
+func (m *Meta) backendForInit(configPath string, viewType arguments.ViewType) (backendrun.OperationsBackend, tfdiags.Diagnostics) {
+	var diags tfdiags.Diagnostics
+
+	if configPath == "" {
+		configPath = "."
+	}
+
+	root, mDiags := m.loadSingleModule(configPath)
+	if mDiags.HasErrors() {
+		diags = diags.Append(mDiags)
+		return nil, diags
+	}
+
+	var opts *BackendOpts
+	switch {
+	case root.Backend != nil:
+		opts = &BackendOpts{
+			BackendConfig: root.Backend,
+			ViewType:      viewType,
+			Init:          true,
+		}
+	case root.CloudConfig != nil:
+		backendConfig := root.CloudConfig.ToBackendConfig()
+		opts = &BackendOpts{
+			BackendConfig: &backendConfig,
+			ViewType:      viewType,
+			Init:          true,
+		}
+	default:
+		// No cloud/backend config; can't fetch variables.
+		return nil, nil
+	}
+
+	be, beDiags := m.Backend(opts)
+	diags = diags.Append(beDiags)
+	if beDiags.HasErrors() {
+		return nil, diags
+	}
+
+	return be, diags
+}
+
 //-------------------------------------------------------------------
 // State Store Config Scenarios
 // The functions below cover handling all the various scenarios that
diff --git a/internal/command/meta_config.go b/internal/command/meta_config.go
index c476378ff1b5..e2b58fdffb01 100644
--- a/internal/command/meta_config.go
+++ b/internal/command/meta_config.go
@@ -47,6 +47,23 @@ func (m *Meta) normalizePath(path string) string {
 // If no const variables are unsatisfied, or if the backend does not support
 // supplying variables, this method is a no-op.
 func (m *Meta) resolveConstVariables(rootDir string, viewType arguments.ViewType) tfdiags.Diagnostics {
+	return m.fetchAndApplyConstVariables(rootDir, func() (backendrun.OperationsBackend, tfdiags.Diagnostics) {
+		return m.backend(rootDir, viewType)
+	})
+}
+
+// resolveConstVariablesForInit is like resolveConstVariables but uses
+// backendForInit so it can run during "terraform init" before the backend
+// state file exists. This is necessary so that dynamic module source
+// expressions (e.g. `source = var.module_path`) can be resolved during
+// module installation, which happens before backend init completes.
+func (m *Meta) resolveConstVariablesForInit(rootDir string, viewType arguments.ViewType) tfdiags.Diagnostics {
+	return m.fetchAndApplyConstVariables(rootDir, func() (backendrun.OperationsBackend, tfdiags.Diagnostics) {
+		return m.backendForInit(rootDir, viewType)
+	})
+}
+
+func (m *Meta) fetchAndApplyConstVariables(rootDir string, loadBackend func() (backendrun.OperationsBackend, tfdiags.Diagnostics)) tfdiags.Diagnostics {
 	rootMod, diags := m.loadSingleModule(rootDir)
 	if diags.HasErrors() {
 		return diags
@@ -56,9 +73,9 @@ func (m *Meta) resolveConstVariables(rootDir string, viewType arguments.ViewType
 		return nil
 	}
 
-	b, backendDiags := m.backend(rootDir, viewType)
+	b, backendDiags := loadBackend()
 	if backendDiags.HasErrors() {
-		// Don't report backend init errors here; they'll surface later.
+		// Don't report backend errors here; they'll surface later during init.
 		return nil
 	}