diff --git a/nova/api/openstack/compute/servers.py b/nova/api/openstack/compute/servers.py
index 883d7c6a924a..b2417d3d59e5 100644
--- a/nova/api/openstack/compute/servers.py
+++ b/nova/api/openstack/compute/servers.py
@@ -509,12 +509,11 @@ class ServersController(wsgi.Controller):
             create_kwargs['legacy_bdm'] = True
         elif block_device_mapping_v2:
             # Have to check whether --image is given, see bug 1433609
-            image_href = server_dict.get('imageRef')
-            image_uuid_specified = image_href is not None
+            image_ref = server_dict.get('imageRef')
             try:
                 block_device_mapping = [
                     block_device.BlockDeviceDict.from_api(bdm_dict,
-                        image_uuid_specified)
+                        image_uuid_specified=image_ref not in {None, ''})
                     for bdm_dict in block_device_mapping_v2]
             except exception.InvalidBDMFormat as e:
                 raise exc.HTTPBadRequest(explanation=e.format_message())
diff --git a/nova/tests/functional/regressions/test_bug_2077980.py b/nova/tests/functional/regressions/test_bug_2077980.py
new file mode 100644
index 000000000000..05b27ede7f75
--- /dev/null
+++ b/nova/tests/functional/regressions/test_bug_2077980.py
@@ -0,0 +1,49 @@
+# Licensed under the Apache License, Version 2.0 (the "License"); you may
+# not use this file except in compliance with the License. You may obtain
+# a copy of the License at
+#
+#      http://www.apache.org/licenses/LICENSE-2.0
+#
+# Unless required by applicable law or agreed to in writing, software
+# distributed under the License is distributed on an "AS IS" BASIS, WITHOUT
+# WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied. See the
+# License for the specific language governing permissions and limitations
+# under the License.
+
+from oslo_utils.fixture import uuidsentinel as uuids
+
+from nova.tests.functional.api import client
+from nova.tests.functional import integrated_helpers
+
+
+class TestImageToLocalBDM(integrated_helpers._IntegratedTestBase):
+    """Regression test for bug 2077980
+
+    This regression test asserts the behaviour of server creation requests when
+    using a BDM with source_type=image, destination_type=local, and
+    boot_index=0, which should result in a failure.
+    """
+    microversion = 'latest'
+
+    # TODO(stephenfin): We should eventually fail regardless of the value of
+    # imageRef, but that requires an API microversion
+    def test_image_to_local_bdm__empty_image(self):
+        """Assert behaviour when booting with imageRef set to empty string"""
+        server = {
+            'name': 'test_image_to_local_bdm__null_image',
+            'imageRef': '',
+            'flavorRef': '1',   # m1.tiny from DefaultFlavorsFixture,
+            'networks': 'none',
+            'block_device_mapping_v2': [{
+                'boot_index': 0,
+                'uuid': uuids.image,
+                'source_type': 'image',
+                'destination_type': 'local'}],
+        }
+        # NOTE(stephenfin): This should always fail as we don't allow users to
+        # set this as it would conflict with the flavor definition.
+        ex = self.assertRaises(
+            client.OpenStackApiException, self.api.post_server,
+            {'server': server})
+        self.assertEqual(400, ex.response.status_code)
+        self.assertIn("Mapping image to local is not supported.", str(ex))