How to fix Error: Error reading local file: no such file or directory in Terraform

Before running Terraform, confirm the file actually exists where your configuration expects it:

# Check if the file exists
ls -la /path/to/your/file.txt

# Or use Terraform to show the evaluated path
terraform console
> abspath("./relative/path/to/file.txt")

If the file doesn't exist, create it first before running Terraform plan or apply. Make sure the filename and path are spelled correctly.

If you're reading a file from within a module, use path.module instead of relative paths:

# ❌ Incorrect - relative path won't work from other modules
data "local_file" "config" {
  filename = "./config.txt"
}

# ✅ Correct - uses module's directory
data "local_file" "config" {
  filename = "${path.module}/config.txt"
}

path.module automatically resolves to the directory containing your current module's .tf files, which works correctly regardless of where you run Terraform from.

If another resource creates the file you're trying to read, use depends_on to ensure correct ordering:

# Resource creates the file
resource "local_file" "generated" {
  filename = "${path.module}/output.txt"
  content  = "generated content"
}

# Data source reads it - but only after resource creates it
data "local_file" "read_generated" {
  filename = local_file.generated.filename
  depends_on = [local_file.generated]  # Explicit dependency
}

Reference the resource output directly instead of using a hardcoded path. This tells Terraform the data source depends on the resource being created first.

Ensure Terraform is running from the correct directory and understand where paths are relative to:

# See where Terraform resolves paths from
terraform console
> path.cwd           # Current working directory
> path.root          # Root module directory
> path.module        # Current module directory
> abspath("file.txt") # Shows where a relative path resolves to

If using Terraform Cloud or Enterprise, verify the workspace's "Terraform Working Directory" setting matches where your files are located. Don't use path.cwd in configurations - use path.module or path.root instead.

If you need to convert a relative path to an absolute path, use the abspath() function:

# Convert relative path to absolute
local {
  config_path = abspath("${path.module}/config.txt")
}

data "local_file" "config" {
  filename = local.config_path
}

This ensures the path is fully resolved and portable across different execution environments.

Don't use absolute paths like /home/user/project/file.txt in production:

# ❌ Avoid - breaks on other machines/environments
data "local_file" "bad" {
  filename = "/home/user/project/file.txt"
}

# ✅ Better - works on any machine/environment
data "local_file" "good" {
  filename = "${path.module}/file.txt"
}

Use path.module, path.root, or relative paths with abspath() to make configurations portable across environments.