diff --git a/tests/unit/test_configloader.py b/tests/unit/test_configloader.py
index 6857035e9d..2840c94924 100644
--- a/tests/unit/test_configloader.py
+++ b/tests/unit/test_configloader.py
@@ -1427,6 +1427,10 @@ class TestNodepoolConfig(ZuulTestCase):
             - section:
                 name: badsection
                 parent: aws-base
+            - provider:
+                name: badprovider
+                section: badsection
+                region: foo
             """)
         file_dict = {'zuul.yaml': in_repo_conf}
         A = self.fake_gerrit.addFakeChange('org/project', 'master', 'A',
@@ -1436,3 +1440,8 @@ class TestNodepoolConfig(ZuulTestCase):
         self.assertEqual(A.reported, 1)
         self.assertEqual(A.patchsets[-1]['approvals'][0]['value'], '-1')
         self.assertIn('references a section', A.messages[0])
+        A.setMerged()
+        self.fake_gerrit.addEvent(A.getChangeMergedEvent())
+        self.waitUntilSettled()
+        tenant = self.scheds.first.sched.abide.tenants.get('tenant-one')
+        self.assertFalse('badprovider' in tenant.layout.providers)
diff --git a/zuul/model.py b/zuul/model.py
index f442ef9ac4..0ba726dd40 100644
--- a/zuul/model.py
+++ b/zuul/model.py
@@ -1834,12 +1834,21 @@ class ProviderConfig(ConfigObject):
     def flattenConfig(self, layout):
         config = copy.deepcopy(Freezable.thaw(self.config))
         parent_name = self.section
+        previous_section = None
         while parent_name:
             parent_section = layout.sections[parent_name]
+            # Prevent sections from referencing sections in other projects
+            if (previous_section and
+                parent_section.source_context.project_canonical_name !=
+                previous_section.source_context.project_canonical_name):
+                raise Exception(
+                    f'The section "{previous_section.name}" references a '
+                    'section in a different project.')
             parent_config = copy.deepcopy(Freezable.thaw(
                 parent_section.config))
             config = ProviderConfig._mergeDict(parent_config, config)
             parent_name = parent_section.parent
+            previous_section = parent_section
         # Provide defaults from the images/flavors/labels objects
         for image in config.get('images', []):
             layout_image = self._dropNone(