diff --git a/packages/nuxt-cli/src/dev/pool.ts b/packages/nuxt-cli/src/dev/pool.ts
index de1df23a8..ff8e0c3fc 100644
--- a/packages/nuxt-cli/src/dev/pool.ts
+++ b/packages/nuxt-cli/src/dev/pool.ts
@@ -130,7 +130,7 @@ export class ForkPool {
       execArgv: ['--enable-source-maps'],
       stdio: pipeOutput ? ['ignore', 'pipe', 'pipe', 'ipc'] : undefined,
       env: {
-        ...process.env,
+        ...withoutDotenvVars(process.env),
         __NUXT__FORK: 'true',
         ...pipeOutput
           ? {
@@ -250,6 +250,14 @@ function trackServing(child: ChildProcess): Promise<void> {
   })
 }
 
+function withoutDotenvVars(env: NodeJS.ProcessEnv): NodeJS.ProcessEnv {
+  const dotenvVars = (globalThis as { __c12_dotenv_vars__?: Map<object, Set<string>> }).__c12_dotenv_vars__?.get(env)
+  if (!dotenvVars?.size) {
+    return env
+  }
+  return Object.fromEntries(Object.entries(env).filter(([key]) => !dotenvVars.has(key)))
+}
+
 /** Colour settings for a piped fork, which cannot detect colour support itself. */
 function forcedColorEnv(): Record<string, string> {
   if (process.env.NO_COLOR || process.env.FORCE_COLOR) {
diff --git a/packages/nuxt-cli/test/e2e/dev-dotenv.spec.ts b/packages/nuxt-cli/test/e2e/dev-dotenv.spec.ts
new file mode 100644
index 000000000..ac1ac5ca7
--- /dev/null
+++ b/packages/nuxt-cli/test/e2e/dev-dotenv.spec.ts
@@ -0,0 +1,73 @@
+import { spawn } from 'node:child_process'
+import { once } from 'node:events'
+import { writeFile } from 'node:fs/promises'
+import { join } from 'node:path'
+import process from 'node:process'
+import { fileURLToPath } from 'node:url'
+import { getPort } from 'get-port-please'
+import { expect, it, vi } from 'vitest'
+import { createDevFixture } from '../utils'
+
+const fixtureDir = await createDevFixture('dev-dotenv')
+const nuxi = fileURLToPath(new URL('../../bin/nuxi.mjs', import.meta.url))
+
+it('should reload dotenv values across successive fork restarts while preserving shell variables', { timeout: 180_000 }, async () => {
+  await writeFile(join(fixtureDir, 'nuxt.config.ts'), `export default defineNuxtConfig({
+  runtimeConfig: { public: { marker: 'default', shell: 'default' } },
+})
+`)
+  await writeFile(join(fixtureDir, 'server/api/dotenv.ts'), `export default defineEventHandler(() => ({
+  pid: process.pid,
+  ...useRuntimeConfig().public,
+}))
+`)
+  const dotenv = join(fixtureDir, '.env')
+  await writeFile(dotenv, 'NUXT_PUBLIC_MARKER=before\nNUXT_PUBLIC_SHELL=file\n')
+
+  const host = '127.0.0.1'
+  const port = await getPort({ host })
+  const server = spawn(process.execPath, [nuxi, 'dev', fixtureDir, '--host', host, '--port', String(port), '--no-tui'], {
+    env: { ...process.env, NODE_ENV: 'development', TEST: '', CI: '1', NUXT_PUBLIC_MARKER: undefined, NUXT_PUBLIC_SHELL: 'shell' },
+    stdio: ['ignore', 'pipe', 'pipe'],
+  })
+  const exited = once(server, 'exit')
+  let output = ''
+  server.stdout.on('data', (chunk) => {
+    output += chunk
+  })
+  server.stderr.on('data', (chunk) => {
+    output += chunk
+  })
+
+  async function waitForMarker(marker: string, previousPid?: number): Promise<number> {
+    let pid = 0
+    await vi.waitFor(async () => {
+      expect(server.exitCode, output).toBeNull()
+      const response = await fetch(`http://${host}:${port}/api/dotenv`, { signal: AbortSignal.timeout(5000) })
+      expect(response.status).toBe(200)
+      const value = await response.json() as { pid: number, marker: string, shell: string }
+      expect(value).toMatchObject({ marker, shell: 'shell' })
+      expect(value.pid).not.toBe(previousPid)
+      pid = value.pid
+    }, { timeout: 45_000, interval: 250 })
+    return pid
+  }
+
+  try {
+    let pid = await waitForMarker('before')
+    for (const marker of ['after', 'third']) {
+      await writeFile(dotenv, `NUXT_PUBLIC_MARKER=${marker}\nNUXT_PUBLIC_SHELL=file\n`)
+      pid = await waitForMarker(marker, pid)
+    }
+    await writeFile(dotenv, '')
+    await waitForMarker('default', pid)
+  }
+  catch (error) {
+    console.error(output)
+    throw error
+  }
+  finally {
+    server.kill('SIGTERM')
+    await exited
+  }
+})