diff --git a/heat/engine/service.py b/heat/engine/service.py
index 57f039cd9c..7d372acf73 100644
--- a/heat/engine/service.py
+++ b/heat/engine/service.py
@@ -1273,6 +1273,14 @@ class EngineService(service.ServiceBase):
                                 'Description', ''),
                             'Parameters': n_params
                         }
+
+                        # Add parameter_groups if it is present in nested stack
+                        nested_pg = parameter_groups.ParameterGroups(
+                            stk[r].nested().t)
+                        if nested_pg.parameter_groups:
+                            n_result[r].update({'ParameterGroups':
+                                               nested_pg.parameter_groups})
+
                         n_result[r].update(nested_params(stk[r].nested()))
                 return {'NestedParameters': n_result} if n_result else {}
 
diff --git a/heat/tests/test_validate.py b/heat/tests/test_validate.py
index 0fc53feb34..ea31e1bae8 100644
--- a/heat/tests/test_validate.py
+++ b/heat/tests/test_validate.py
@@ -19,6 +19,7 @@ import webob
 from heat.common import exception
 from heat.common.i18n import _
 from heat.common import template_format
+from heat.common import urlfetch
 from heat.engine.clients.os import glance
 from heat.engine.clients.os import nova
 from heat.engine import environment
@@ -1746,3 +1747,67 @@ class ValidateTest(common.HeatTestCase):
         ex = webob.exc.HTTPBadRequest(explanation=msg)
         self.assertIsInstance(res, webob.exc.HTTPBadRequest)
         self.assertEqual(ex.explanation, res.explanation)
+
+    def test_validate_parameter_group_output(self):
+        engine = service.EngineService('a', 't')
+        params = {
+            "resource_registry": {
+                "OS::Test::TestResource": "https://server.test/nested.template"
+            }
+        }
+        root_template_str = '''
+heat_template_version: 2015-10-15
+parameters:
+    test_root_param:
+        type: string
+parameter_groups:
+-   label: RootTest
+    parameters:
+    -   test_root_param
+resources:
+    Nested:
+        type: OS::Test::TestResource
+'''
+        nested_template_str = '''
+heat_template_version: 2015-10-15
+parameters:
+    test_param:
+        type: string
+parameter_groups:
+-   label: Test
+    parameters:
+    -   test_param
+'''
+        root_template = template_format.parse(root_template_str)
+
+        self.patchobject(urlfetch, 'get')
+        urlfetch.get.return_value = nested_template_str
+
+        res = dict(engine.validate_template(self.ctx, root_template,
+                                            params, show_nested=True))
+        expected = {
+            'Description': 'No description',
+            'ParameterGroups': [{
+                'label': 'RootTest',
+                'parameters': ['test_root_param']}],
+            'Parameters': {
+                'test_root_param': {
+                    'Description': '',
+                    'Label': 'test_root_param',
+                    'NoEcho': 'false',
+                    'Type': 'String'}},
+            'NestedParameters': {
+                'Nested': {
+                    'Description': 'No description',
+                    'ParameterGroups': [{
+                        'label': 'Test',
+                        'parameters': ['test_param']}],
+                    'Parameters': {
+                        'test_param': {
+                            'Description': '',
+                            'Label': 'test_param',
+                            'NoEcho': 'false',
+                            'Type': 'String'}},
+                    'Type': 'OS::Test::TestResource'}},
+        }
+        self.assertEqual(expected, res)
diff --git a/releasenotes/notes/parameter-group-for-nested-04559c4de34e326a.yaml b/releasenotes/notes/parameter-group-for-nested-04559c4de34e326a.yaml
new file mode 100644
index 0000000000..852139cb5f
--- /dev/null
+++ b/releasenotes/notes/parameter-group-for-nested-04559c4de34e326a.yaml
@@ -0,0 +1,4 @@
+---
+features:
+  - ParameterGroups section is added to the nested stacks,
+    for the output of the stack validate templates.