diff --git a/packages/nuxt/src/core/schema.ts b/packages/nuxt/src/core/schema.ts
index 77fa41f094..ea569c833e 100644
--- a/packages/nuxt/src/core/schema.ts
+++ b/packages/nuxt/src/core/schema.ts
@@ -142,17 +142,18 @@ export default defineNuxtModule({
         _types +
         `
 export type CustomAppConfig = Exclude<NuxtCustomSchema['appConfig'], undefined>
+type _CustomAppConfig = CustomAppConfig
 
 declare module '@nuxt/schema' {
-  interface NuxtConfig extends NuxtCustomSchema {}
-  interface NuxtOptions extends NuxtCustomSchema {}
-  interface CustomAppConfig extends CustomAppConfig {}
+  interface NuxtConfig extends Omit<NuxtCustomSchema, 'appConfig'> {}
+  interface NuxtOptions extends Omit<NuxtCustomSchema, 'appConfig'> {}
+  interface CustomAppConfig extends _CustomAppConfig {}
 }
 
 declare module 'nuxt/schema' {
-  interface NuxtConfig extends NuxtCustomSchema {}
-  interface NuxtOptions extends NuxtCustomSchema {}
-  interface CustomAppConfig extends CustomAppConfig {}
+  interface NuxtConfig extends Omit<NuxtCustomSchema, 'appConfig'> {}
+  interface NuxtOptions extends Omit<NuxtCustomSchema, 'appConfig'> {}
+  interface CustomAppConfig extends _CustomAppConfig {}
 }
 `
       const typesPath = resolve(
diff --git a/packages/nuxt/src/core/templates.ts b/packages/nuxt/src/core/templates.ts
index 76a5aab5fa..c6d70dabad 100644
--- a/packages/nuxt/src/core/templates.ts
+++ b/packages/nuxt/src/core/templates.ts
@@ -194,14 +194,28 @@ export const appConfigDeclarationTemplate: NuxtTemplate = {
   filename: 'types/app.config.d.ts',
   getContents: ({ app, nuxt }) => {
     return `
+import type { CustomAppConfig } from 'nuxt/schema'
 import type { Defu } from 'defu'
 ${app.configs.map((id: string, index: number) => `import ${`cfg${index}`} from ${JSON.stringify(id.replace(/(?<=\w)\.\w+$/g, ''))}`).join('\n')}
 
 declare const inlineConfig = ${JSON.stringify(nuxt.options.appConfig, null, 2)}
 type ResolvedAppConfig = Defu<typeof inlineConfig, [${app.configs.map((_id: string, index: number) => `typeof cfg${index}`).join(', ')}]>
 
+type MergedAppConfig<Resolved extends Record<string, any>, Custom extends Record<string, any>> = {
+  [K in keyof Resolved]: K extends keyof Custom
+    ? Custom[K] extends Record<string, any>
+      ? Resolved[K] extends Record<string, any>
+        ? MergedAppConfig<Resolved[K], Custom[K]>
+        : Exclude<Custom[K], undefined>
+      : Exclude<Custom[K], undefined>
+    : Resolved[K]
+}
+
 declare module 'nuxt/schema' {
-  interface AppConfig extends ResolvedAppConfig { }
+  interface AppConfig extends MergedAppConfig<ResolvedAppConfig, CustomAppConfig> { }
+}
+declare module '@nuxt/schema' {
+  interface AppConfig extends MergedAppConfig<ResolvedAppConfig, CustomAppConfig> { }
 }
 `
   }
diff --git a/packages/schema/src/types/config.ts b/packages/schema/src/types/config.ts
index 047f3cd958..f175e72ed8 100644
--- a/packages/schema/src/types/config.ts
+++ b/packages/schema/src/types/config.ts
@@ -136,7 +136,7 @@ export interface RuntimeConfig extends RuntimeConfigNamespace {
 
 // -- App Config --
 
-export interface CustomAppConfig extends Record<string, any> { }
+export interface CustomAppConfig { }
 
 export interface AppConfigInput extends CustomAppConfig {
   /** @deprecated reserved */
@@ -156,4 +156,4 @@ export interface NuxtAppConfig {
   keepalive: boolean | KeepAliveProps
 }
 
-export interface AppConfig extends CustomAppConfig { }
+export interface AppConfig { }
diff --git a/test/fixtures/basic/nuxt.schema.ts b/test/fixtures/basic/nuxt.schema.ts
index 42ac4eea86..950b325655 100644
--- a/test/fixtures/basic/nuxt.schema.ts
+++ b/test/fixtures/basic/nuxt.schema.ts
@@ -1,6 +1,10 @@
 export default defineNuxtSchema({
   appConfig: {
-    /** This is an example app config defined in custom schema */
+    /**
+     * This is an example app config defined in custom schema
+     *
+     * @type {123 | 456}
+     */
     userConfig: 123
   }
 })
diff --git a/test/fixtures/basic/types.ts b/test/fixtures/basic/types.ts
index f73856d7c1..b0f22dffcc 100644
--- a/test/fixtures/basic/types.ts
+++ b/test/fixtures/basic/types.ts
@@ -246,13 +246,12 @@ describe('composables', () => {
 describe('app config', () => {
   it('merges app config as expected', () => {
     interface ExpectedMergedAppConfig {
-      fromLayer: boolean,
-      fromNuxtConfig: boolean,
+      fromLayer: boolean
+      fromNuxtConfig: boolean
       nested: {
         val: number
-      },
-      userConfig: number
-      [key: string]: any
+      }
+      userConfig: 123 | 456
     }
     expectTypeOf<AppConfig>().toEqualTypeOf<ExpectedMergedAppConfig>()
   })