diff --git a/packages/hoppscotch-common/src/components/environments/my/Details.vue b/packages/hoppscotch-common/src/components/environments/my/Details.vue
index 47d7b2e4..44b7a947 100644
--- a/packages/hoppscotch-common/src/components/environments/my/Details.vue
+++ b/packages/hoppscotch-common/src/components/environments/my/Details.vue
@@ -492,21 +492,12 @@ const saveEnvironment = () => {
 
   const variables = pipe(
     filteredVariables,
-    A.map((e) =>
-      e.secret
-        ? {
-            key: e.key,
-            secret: e.secret,
-            initialValue: e.initialValue,
-            currentValue: "",
-          }
-        : {
-            key: e.key,
-            secret: e.secret,
-            initialValue: e.initialValue,
-            currentValue: "",
-          }
-    )
+    A.map((e) => ({
+      key: e.key,
+      secret: e.secret,
+      initialValue: e.initialValue || "",
+      currentValue: "",
+    }))
   )
 
   const environmentUpdated: Environment = {
diff --git a/packages/hoppscotch-common/src/components/environments/teams/Details.vue b/packages/hoppscotch-common/src/components/environments/teams/Details.vue
index 3759da77..1d696fb4 100644
--- a/packages/hoppscotch-common/src/components/environments/teams/Details.vue
+++ b/packages/hoppscotch-common/src/components/environments/teams/Details.vue
@@ -437,7 +437,7 @@ const saveEnvironment = async () => {
     A.map((e) => ({
       key: e.key,
       secret: e.secret,
-      initialValue: e.initialValue,
+      initialValue: e.initialValue || "",
       currentValue: "",
     }))
   )
diff --git a/packages/hoppscotch-common/src/helpers/RequestRunner.ts b/packages/hoppscotch-common/src/helpers/RequestRunner.ts
index eebd69b1..a9a45fb3 100644
--- a/packages/hoppscotch-common/src/helpers/RequestRunner.ts
+++ b/packages/hoppscotch-common/src/helpers/RequestRunner.ts
@@ -100,6 +100,16 @@ export const getTestableBody = (
   return x
 }
 
+/**
+ * Combines the environment variables from the request and the selected, global, and temporary environments.
+ * The priority is as follows:
+ * 1. Request variables
+ * 2. Temporary variables (if any)
+ * 3. Selected environment variables
+ * 4. Global environment variables
+ * @param variables The environment variables to combine
+ * @returns The combined environment variables
+ */
 export const combineEnvVariables = (variables: {
   environments: {
     selected: Environment["variables"]
@@ -119,8 +129,8 @@ export const executedResponses$ = new Subject<
 >()
 
 /**
- * Used to update the environment schema with the secret variables
- * and store the secret variable values in the secret environment service
+ * This will update the environment variables in the current environment
+ * and secret environment service.
  * @param envs The environment variables to update
  * @param type Whether the environment variables are global or selected
  * @returns the updated environment variables
@@ -216,8 +226,24 @@ const getEnvironmentVariableValue = (
   )
 }
 
+/**
+ * Set currentValue as initialValue if currentValue is empty
+ * This is set just for request runtime and it will not be persisted.
+ * @param env The environment variable to be transformed
+ * @returns The transformed environment variable with currentValue set to initialValue if empty
+ */
+const getTransformedEnvs = (
+  env: Environment["variables"][number]
+): Environment["variables"][number] => {
+  return {
+    ...env,
+    currentValue: env.currentValue || env.initialValue,
+  }
+}
+
 /**
  * Transforms the environment list to a list with unique keys with value
+ * and set currentValue as initialValue if currentValue is empty.
  * @param envs The environment list to be transformed
  * @returns The transformed environment list with keys with value
  */
@@ -226,21 +252,21 @@ const filterNonEmptyEnvironmentVariables = (
 ): Environment["variables"] => {
   const envsMap = new Map<string, Environment["variables"][number]>()
   envs.forEach((env) => {
-    if (env.secret) {
-      envsMap.set(env.key, env)
-    } else if (envsMap.has(env.key)) {
-      const existingEnv = envsMap.get(env.key)
+    const transformedEnv = getTransformedEnvs(env)
+
+    if (envsMap.has(transformedEnv.key)) {
+      const existingEnv = envsMap.get(transformedEnv.key)
 
       if (
         existingEnv &&
         "currentValue" in existingEnv &&
         existingEnv.currentValue === "" &&
-        env.currentValue !== ""
+        transformedEnv.currentValue !== ""
       ) {
-        envsMap.set(env.key, env)
+        envsMap.set(transformedEnv.key, transformedEnv)
       }
     } else {
-      envsMap.set(env.key, env)
+      envsMap.set(transformedEnv.key, transformedEnv)
     }
   })
 
@@ -502,7 +528,7 @@ function updateEnvsAfterTestScript(runResult: E.Right<SandboxTestResult>) {
     v: 2,
     variables: globalEnvVariables,
   })
-  updateEnvironments(
+  const selectedEnvVariables = updateEnvironments(
     // @ts-expect-error Typescript can't figure out this inference for some reason
     cloneDeep(runResult.right.envs.selected),
     "selected"
@@ -516,7 +542,7 @@ function updateEnvsAfterTestScript(runResult: E.Right<SandboxTestResult>) {
       name: env.name,
       v: 2,
       id: "id" in env ? env.id : "",
-      variables: runResult.right.envs.selected,
+      variables: selectedEnvVariables,
     })
   } else if (
     environmentsStore.value.selectedEnvironmentIndex.type === "TEAM_ENV"
@@ -526,7 +552,7 @@ function updateEnvsAfterTestScript(runResult: E.Right<SandboxTestResult>) {
     })
     pipe(
       updateTeamEnvironment(
-        JSON.stringify(runResult.right.envs.selected),
+        JSON.stringify(selectedEnvVariables),
         environmentsStore.value.selectedEnvironmentIndex.teamEnvID,
         env.name
       )
@@ -565,13 +591,15 @@ export function runTestRunnerRequest(
       id: "env-id",
       v: 2,
       name: "Env",
-      variables: combineEnvVariables({
-        environments: {
-          ...preRequestScriptResult.right.envs,
-          temp: !persistEnv ? getTemporaryVariables() : [],
-        },
-        requestVariables: [],
-      }),
+      variables: filterNonEmptyEnvironmentVariables(
+        combineEnvVariables({
+          environments: {
+            ...preRequestScriptResult.right.envs,
+            temp: !persistEnv ? getTemporaryVariables() : [],
+          },
+          requestVariables: [],
+        })
+      ),
     })
 
     const [stream] = createRESTNetworkRequestStream(effectiveRequest)
diff --git a/packages/hoppscotch-common/src/helpers/editor/extensions/HoppEnvironment.ts b/packages/hoppscotch-common/src/helpers/editor/extensions/HoppEnvironment.ts
index 1c817f62..a335fc74 100644
--- a/packages/hoppscotch-common/src/helpers/editor/extensions/HoppEnvironment.ts
+++ b/packages/hoppscotch-common/src/helpers/editor/extensions/HoppEnvironment.ts
@@ -57,7 +57,11 @@ const filterNonEmptyEnvironmentVariables = (
     if (envsMap.has(env.key)) {
       const existingEnv = envsMap.get(env.key)
 
-      if (existingEnv?.currentValue === "" && env.currentValue !== "") {
+      if (
+        existingEnv?.currentValue === "" &&
+        existingEnv?.initialValue === "" &&
+        (env.currentValue || env.initialValue)
+      ) {
         envsMap.set(env.key, env)
       }
     } else {
diff --git a/packages/hoppscotch-common/src/helpers/utils/environments.ts b/packages/hoppscotch-common/src/helpers/utils/environments.ts
index 2d952fc0..d197c384 100644
--- a/packages/hoppscotch-common/src/helpers/utils/environments.ts
+++ b/packages/hoppscotch-common/src/helpers/utils/environments.ts
@@ -40,10 +40,7 @@ const unWrapEnvironments = (
     }
     return {
       ...globalVar,
-      currentValue:
-        currentVar?.currentValue ??
-        globalVar.currentValue ??
-        globalVar.initialValue,
+      currentValue: currentVar?.currentValue || globalVar.currentValue || "",
     }
   })
 
@@ -66,9 +63,7 @@ const unWrapEnvironments = (
       return {
         ...selectedVar,
         currentValue:
-          currentVar?.currentValue ??
-          selectedVar.currentValue ??
-          selectedVar.initialValue,
+          currentVar?.currentValue || selectedVar.currentValue || "",
       }
     }
   )
diff --git a/packages/hoppscotch-common/src/newstore/environments.ts b/packages/hoppscotch-common/src/newstore/environments.ts
index 80f7d1d6..f8b43ce1 100644
--- a/packages/hoppscotch-common/src/newstore/environments.ts
+++ b/packages/hoppscotch-common/src/newstore/environments.ts
@@ -427,6 +427,10 @@ export type AggregateEnvironment = {
  * Stream returning all the environment variables accessible in
  * the current state (Global + The Selected Environment).
  * NOTE: The source environment attribute will be "Global" for Global Env as source.
+ * The priority of the variables is as follows:
+ * 1. Pre-defined variables
+ * 2. Selected Environment Variables
+ * 3. Global Environment Variables
  */
 export const aggregateEnvs$: Observable<AggregateEnvironment[]> = combineLatest(
   [currentEnvironment$, globalEnv$]
@@ -492,7 +496,7 @@ export function getAggregateEnvs() {
   const currentEnv = getCurrentEnvironment()
   return [
     ...currentEnv.variables.map((x) => {
-      let currentValue
+      let currentValue = ""
       if (!x.secret) {
         currentValue = x.currentValue
       }
@@ -506,7 +510,7 @@ export function getAggregateEnvs() {
       }
     }),
     ...getGlobalVariables().map((x) => {
-      let currentValue
+      let currentValue = ""
       if (!x.secret) {
         currentValue = x.currentValue
       }
@@ -567,6 +571,7 @@ export const aggregateEnvsWithSecrets$: Observable<AggregateEnvironment[]> =
   combineLatest([currentEnvironment$, globalEnv$]).pipe(
     map(([selectedEnv, globalEnv]) => {
       const results: AggregateEnvironment[] = []
+
       selectedEnv?.variables.map((x, index) => {
         let currentValue = x.currentValue
         if (x.secret) {