diff --git a/src/compiler/build_context/target_info.rs b/src/compiler/build_context/target_info.rs
index de4b197a07f..6788e1c65c9 100644
--- a/src/compiler/build_context/target_info.rs
+++ b/src/compiler/build_context/target_info.rs
@@ -574,9 +574,10 @@ impl TargetInfo {
         target_kind: &TargetKind,
         target_triple: &str,
         gctx: &GlobalContext,
+        rustc: &Rustc,
     ) -> CargoResult<(Vec<FileType>, Vec<CrateType>)> {
         match mode {
-            CompileMode::Build => self.calc_rustc_outputs(target_kind, target_triple, gctx),
+            CompileMode::Build => self.calc_rustc_outputs(target_kind, target_triple, gctx, rustc),
             CompileMode::Test => {
                 match self.file_types(&CrateType::Bin, FileFlavor::Normal, target_triple)? {
                     Some(fts) => Ok((fts, Vec::new())),
@@ -598,6 +599,7 @@ impl TargetInfo {
         target_kind: &TargetKind,
         target_triple: &str,
         gctx: &GlobalContext,
+        rustc: &Rustc,
     ) -> CargoResult<(Vec<FileType>, Vec<CrateType>)> {
         let mut unsupported = Vec::new();
         let mut result = Vec::new();
@@ -619,7 +621,7 @@ impl TargetInfo {
             }
         }
         if !result.is_empty() {
-            if !gctx.should_embed_metadata()
+            if !gctx.should_embed_metadata(rustc)
                 && crate_types
                     .iter()
                     .any(|ct| ct.benefits_from_no_embed_metadata())
diff --git a/src/compiler/build_runner/compilation_files.rs b/src/compiler/build_runner/compilation_files.rs
index 8a6be2cdf9f..ff2850d865d 100644
--- a/src/compiler/build_runner/compilation_files.rs
+++ b/src/compiler/build_runner/compilation_files.rs
@@ -421,6 +421,7 @@ impl<'a, 'gctx: 'a> CompilationFiles<'a, 'gctx> {
                 &TargetKind::Bin,
                 bcx.target_data.short_name(&kind),
                 bcx.gctx,
+                bcx.rustc(),
             )
             .expect("target must support `bin`");
 
@@ -664,7 +665,7 @@ impl<'a, 'gctx: 'a> CompilationFiles<'a, 'gctx> {
         let info = bcx.target_data.info(unit.kind);
         let triple = bcx.target_data.short_name(&unit.kind);
         let (file_types, unsupported) =
-            info.rustc_outputs(unit.mode, unit.target.kind(), triple, bcx.gctx)?;
+            info.rustc_outputs(unit.mode, unit.target.kind(), triple, bcx.gctx, bcx.rustc())?;
         if file_types.is_empty() {
             if !unsupported.is_empty() {
                 let unsupported_strs: Vec<_> = unsupported.iter().map(|ct| ct.as_str()).collect();
diff --git a/src/compiler/fingerprint/mod.rs b/src/compiler/fingerprint/mod.rs
index 172165dca40..87af84e984c 100644
--- a/src/compiler/fingerprint/mod.rs
+++ b/src/compiler/fingerprint/mod.rs
@@ -1676,7 +1676,7 @@ fn calculate_normal(
     build_runner
         .bcx
         .gctx
-        .should_embed_metadata()
+        .should_embed_metadata(build_runner.bcx.rustc())
         .not()
         .hash(&mut config);
 
diff --git a/src/compiler/mod.rs b/src/compiler/mod.rs
index d7fa56e1c46..ca5c900fd96 100644
--- a/src/compiler/mod.rs
+++ b/src/compiler/mod.rs
@@ -1320,7 +1320,11 @@ fn build_base_args(
 
     if unit.mode.is_check() {
         cmd.arg("--emit=dep-info,metadata");
-    } else if !build_runner.bcx.gctx.should_embed_metadata() {
+    } else if !build_runner
+        .bcx
+        .gctx
+        .should_embed_metadata(build_runner.bcx.rustc())
+    {
         // Nightly rustc supports the -Zembed-metadata=no flag, which tells it to avoid including
         // full metadata in rlib/dylib artifacts, to save space on disk. In this case, metadata
         // will only be stored in .rmeta files.
@@ -1814,7 +1818,10 @@ pub fn extern_args(
     let mut result = Vec::new();
     let deps = build_runner.unit_deps(unit);
 
-    let no_embed_metadata = !build_runner.bcx.gctx.should_embed_metadata();
+    let no_embed_metadata = !build_runner
+        .bcx
+        .gctx
+        .should_embed_metadata(build_runner.bcx.rustc());
     let public_dependency_enabled = is_public_dependency_enabled(build_runner, unit);
 
     // Closure to add one dependency to `result`.
diff --git a/src/context/mod.rs b/src/context/mod.rs
index b743ea47168..e0763f26da8 100644
--- a/src/context/mod.rs
+++ b/src/context/mod.rs
@@ -1269,8 +1269,19 @@ impl GlobalContext {
         self.extra_verbose
     }
 
-    pub fn should_embed_metadata(&self) -> bool {
-        self.cli_unstable().embed_metadata.unwrap_or(true)
+    pub fn should_embed_metadata(&self, rustc: &Rustc) -> bool {
+        match self.cli_unstable().embed_metadata {
+            Some(v) => v,
+            None => {
+                let cargo_nightly = matches!(
+                    crate::version().release_channel.as_deref(),
+                    Some("nightly" | "dev")
+                );
+                // Enable -Zembed-metadata=no by default if both cargo and rustc are nightly
+                let is_nightly = cargo_nightly && rustc.is_nightly;
+                !is_nightly
+            }
+        }
     }
 
     pub fn network_allowed(&self) -> bool {
diff --git a/src/ops/cargo_clean.rs b/src/ops/cargo_clean.rs
index fa3830775db..82d7d9386df 100644
--- a/src/ops/cargo_clean.rs
+++ b/src/ops/cargo_clean.rs
@@ -298,9 +298,14 @@ fn clean_specs(
                 ] {
                     for (compile_kind, layout) in &layouts {
                         let triple = target_data.short_name(compile_kind);
-                        let (file_types, _unsupported) = target_data
-                            .info(*compile_kind)
-                            .rustc_outputs(mode, target.kind(), triple, clean_ctx.gctx)?;
+                        let (file_types, _unsupported) =
+                            target_data.info(*compile_kind).rustc_outputs(
+                                mode,
+                                target.kind(),
+                                triple,
+                                clean_ctx.gctx,
+                                &target_data.rustc,
+                            )?;
                         let artifact_dir = layout
                             .artifact_dir()
                             .expect("artifact-dir was not locked during clean");
@@ -375,9 +380,14 @@ fn clean_specs(
                 ] {
                     for (compile_kind, layout) in &layouts {
                         let triple = target_data.short_name(compile_kind);
-                        let (file_types, _unsupported) = target_data
-                            .info(*compile_kind)
-                            .rustc_outputs(mode, target.kind(), triple, clean_ctx.gctx)?;
+                        let (file_types, _unsupported) =
+                            target_data.info(*compile_kind).rustc_outputs(
+                                mode,
+                                target.kind(),
+                                triple,
+                                clean_ctx.gctx,
+                                &target_data.rustc,
+                            )?;
                         let artifact_dir = layout
                             .artifact_dir()
                             .expect("artifact-dir was not locked during clean");
diff --git a/src/util/rustc.rs b/src/util/rustc.rs
index 1ab62ae0134..6ed123d7cbf 100644
--- a/src/util/rustc.rs
+++ b/src/util/rustc.rs
@@ -12,7 +12,7 @@ use tracing::{debug, info, warn};
 
 use crate::compiler::apply_env_config;
 use crate::util::interning::InternedString;
-use crate::util::{CargoResult, GlobalContext, StableHasher};
+use crate::util::{CargoResult, GlobalContext, StableHasher, VersionExt};
 
 /// Information on the `rustc` executable
 #[derive(Debug)]
@@ -32,6 +32,8 @@ pub struct Rustc {
     pub host: InternedString,
     /// The rustc full commit hash, this comes from `verbose_version`.
     pub commit_hash: Option<String>,
+    /// Is the rustc on a nightly or a dev channel?
+    pub is_nightly: bool,
     cache: Mutex<Cache>,
 }
 
@@ -88,6 +90,8 @@ impl Rustc {
                 verbose_version
             )
         })?;
+        let is_nightly =
+            version.is_prerelease() && matches!(version.pre.as_str(), "dev" | "nightly");
         let commit_hash = extract("commit-hash: ").ok().map(|hash| {
             // Possible commit-hash values from rustc are SHA hex string and "unknown". See:
             // * https://github.com/rust-lang/rust/blob/531cb83fc/src/bootstrap/src/utils/channel.rs#L73
@@ -114,6 +118,7 @@ impl Rustc {
             version,
             host,
             commit_hash,
+            is_nightly,
             cache: Mutex::new(cache),
         })
     }
diff --git a/tests/testsuite/build.rs b/tests/testsuite/build.rs
index 4f6ad78d869..4901b0c00c8 100644
--- a/tests/testsuite/build.rs
+++ b/tests/testsuite/build.rs
@@ -6539,7 +6539,7 @@ fn embed_metadata_no_invalidate() {
         )
         .build();
 
-    p.cargo("build -Z embed-metadata=no")
+    p.cargo("build -Z embed-metadata=yes")
         .masquerade_as_nightly_cargo(&["-Z embed-metadata"])
         .with_stderr_data(str![[r#"
 [LOCKING] 1 package to highest compatible version
@@ -6552,8 +6552,6 @@ fn embed_metadata_no_invalidate() {
     p.cargo("build")
         .masquerade_as_nightly_cargo(&["-Z embed-metadata"])
         .with_stderr_data(str![[r#"
-[COMPILING] bar v0.5.0 ([ROOT]/foo/bar)
-[COMPILING] foo v0.5.0 ([ROOT]/foo)
 [FINISHED] `dev` profile [unoptimized + debuginfo] target(s) in [ELAPSED]s
 
 "#]])
diff --git a/tests/testsuite/build_script_env.rs b/tests/testsuite/build_script_env.rs
index 6daf9a4dc47..cc09f075f14 100644
--- a/tests/testsuite/build_script_env.rs
+++ b/tests/testsuite/build_script_env.rs
@@ -142,6 +142,7 @@ fn rustc_bootstrap() {
         // NOTE: uses RUSTC_BOOTSTRAP so it will be propagated to rustc
         // (this matters when tests are being run with a beta or stable cargo)
         .env("RUSTC_BOOTSTRAP", "1")
+        .arg("-Zembed-metadata=yes")
         .with_stderr_data(str![[r#"
 [COMPILING] has-dashes v0.0.1 ([ROOT]/foo)
 [WARNING] has-dashes@0.0.1: cannot set `RUSTC_BOOTSTRAP=1` from build script of `has-dashes v0.0.1 ([ROOT]/foo)`.
@@ -187,6 +188,7 @@ fn rustc_bootstrap() {
         // NOTE: uses RUSTC_BOOTSTRAP so it will be propagated to rustc
         // (this matters when tests are being run with a beta or stable cargo)
         .env("RUSTC_BOOTSTRAP", "1")
+        .arg("-Zembed-metadata=yes")
         .with_stderr_data(str![[r#"
 [COMPILING] foo v0.0.1 ([ROOT]/foo)
 [WARNING] foo@0.0.1: cannot set `RUSTC_BOOTSTRAP=1` from build script of `foo v0.0.1 ([ROOT]/foo)`.