How to fix Error: Invalid filesystem path in Terraform

The most common fix is to replace relative paths with path.module (current module directory) or path.root (root module directory).

Instead of this (WRONG):

resource "aws_lambda_function" "example" {
  filename = "lambda.zip"  # Will fail - relative to CWD, not consistent
  handler  = "index.handler"
}

Do this (CORRECT):

resource "aws_lambda_function" "example" {
  filename = "${path.module}/lambda.zip"
  handler  = "index.handler"
}

This ensures the file is located relative to the module file itself, not wherever terraform is run from.

Check that the file you're referencing actually exists at the specified path:

# From your terraform working directory:
ls -la ./lambda.zip
ls -la ./templates/policy.json

# Or use absolute path:
ls -la /home/user/project/lambda.zip

The file() function only works with files that are part of your configuration source code. It cannot reference files that will be created by resources.

When calling local modules, use paths relative to the root module:

Instead of this (may fail):

module "vpc" {
  source = "./modules/vpc"  # OK from root, but fragile from subdirectories
}

Better approach (always works):

module "vpc" {
  source = "${path.root}/modules/vpc"
}

This is especially important in Terraform Cloud/Enterprise or when modules are called from different contexts.

If you have symlinks in your configuration directory, especially ones pointing outside the repository:

# Find all symlinks:
find . -type l -ls

# Resolve symlinks to actual paths:
ls -L ./config-file

Symlinks that point outside your configuration directory will break in Terraform Cloud/Enterprise because the worker doesn't have access to those external paths. Consider copying the file instead or using an absolute path that exists on the remote runner.

If you need to reference files in a user's home directory (like SSH keys), use the pathexpand() function:

# Instead of:
provisioner "remote-exec" {
  private_key = file("~/.ssh/id_rsa")  # May fail - ~ not expanded
}

# Do this:
provisioner "remote-exec" {
  private_key = file(pathexpand("~/.ssh/id_rsa"))
}

This ensures tilde (~) expansion works correctly on all platforms.

If running Terraform on Windows Subsystem for Linux (WSL), be aware of cross-filesystem path issues:

# Verify file is accessible from Terraform's perspective:
cat /path/to/file

# Check if path is on WSL filesystem (preferred) vs Windows drive:
pwd  # Should show /home or /mnt paths

# If file is on Windows drive (/mnt/c/Users/...), consider:
# 1. Copy file to WSL home directory
# 2. Use absolute path with proper escaping

WSL can have issues with path transformations between Windows and Linux filesystems. Keeping your terraform files and referenced files on the WSL side (/home/user) avoids most issues.