diff --git a/docs/notes/2.23.x.md b/docs/notes/2.23.x.md
index c2fd7e529f5..f1fceb22e59 100644
--- a/docs/notes/2.23.x.md
+++ b/docs/notes/2.23.x.md
@@ -100,6 +100,8 @@ The `tfsec` linter now works on all supported platforms without extra config.
 
 Sandboxes for the `experimental-deploy` deployment (the execution of `terraform apply`) can now be preserved with `--keep-sandboxes`.
 
+[The `terraform-hcl2-parser` subsystem](https://www.pantsbuild.org/2.21/reference/subsystems/terraform-hcl2-parser) downgrades `python-hcl2` version back to 4.3.0 by default to avoid parsing issues introduced afterwards.
+
 #### Javascript
 
 The Node.js runtime now uses version 18.20.3 by default. This is a major version upgrade from the 16.x series, which was used before.
diff --git a/src/python/pants/backend/terraform/dependency_inference.py b/src/python/pants/backend/terraform/dependency_inference.py
index d7df948bd0b..6a701a82337 100644
--- a/src/python/pants/backend/terraform/dependency_inference.py
+++ b/src/python/pants/backend/terraform/dependency_inference.py
@@ -47,7 +47,8 @@ class TerraformHcl2Parser(PythonToolRequirementsBase):
     options_scope = "terraform-hcl2-parser"
     help_short = "Used to parse Terraform modules to infer their dependencies."
 
-    default_requirements = ["python-hcl2>=3.0.5,<5"]
+    # versions 4.3.2+ have parsing issues; bump once resolved
+    default_requirements = ["python-hcl2>=3.0.5,<=4.3.0"]
 
     register_interpreter_constraints = True
 
diff --git a/src/python/pants/backend/terraform/hcl2.lock b/src/python/pants/backend/terraform/hcl2.lock
index a6e8cd0abe5..b4196f84d79 100644
--- a/src/python/pants/backend/terraform/hcl2.lock
+++ b/src/python/pants/backend/terraform/hcl2.lock
@@ -9,7 +9,7 @@
 //     "CPython<4,>=3.7"
 //   ],
 //   "generated_with_requirements": [
-//     "python-hcl2<5,>=3.0.5"
+//     "python-hcl2<=4.3.0,>=3.0.5"
 //   ],
 //   "manylinux": "manylinux2014",
 //   "requirement_constraints": [],
@@ -54,13 +54,13 @@
           "artifacts": [
             {
               "algorithm": "sha256",
-              "hash": "e958fe52ca0519e3500eb621caa16be6be9c27870cbcd1879d8c538fb85067ea",
-              "url": "https://files.pythonhosted.org/packages/34/0a/39813c22334a22b43ffd16acb06aa4541ea1d34bfeab2aa2bcece83a471f/python_hcl2-4.3.2-py3-none-any.whl"
+              "hash": "6c76d1d523b6fb8ca6d1f70308459f310853e124c4bbfe9fcc018bcacdc78a40",
+              "url": "https://files.pythonhosted.org/packages/0d/58/32f70aa0d776a467472ee0077929e03d4febb681f6b564cec1d58c09d95b/python_hcl2-4.3.0-py3-none-any.whl"
             },
             {
               "algorithm": "sha256",
-              "hash": "7122661438be27ccd8b8f3db71969d8ef2cce3b3cf183e88f8172575e7405a65",
-              "url": "https://files.pythonhosted.org/packages/ef/94/cc6f7100a857a5a4a676c2c71322ca476051278fad4ec956f0116c1d3834/python-hcl2-4.3.2.tar.gz"
+              "hash": "41e37e2a9b3d223da5e8ebc99e72b40d2315087e966f458f7eac13c7831d9b9e",
+              "url": "https://files.pythonhosted.org/packages/0b/8c/9c7858604212b25e040652fba3eb06514b363b857544f7321ca97185f001/python-hcl2-4.3.0.tar.gz"
             }
           ],
           "project_name": "python-hcl2",
@@ -68,7 +68,7 @@
             "lark<2,>=1"
           ],
           "requires_python": ">=3.7.0",
-          "version": "4.3.2"
+          "version": "4.3.0"
         }
       ],
       "platform_tag": null
@@ -77,11 +77,11 @@
   "only_builds": [],
   "only_wheels": [],
   "path_mappings": {},
-  "pex_version": "2.2.1",
+  "pex_version": "2.3.3",
   "pip_version": "24.0",
   "prefer_older_binary": false,
   "requirements": [
-    "python-hcl2<5,>=3.0.5"
+    "python-hcl2<=4.3.0,>=3.0.5"
   ],
   "requires_python": [
     "<4,>=3.7"