diff --git a/packages/nuxt/src/app/composables/fetch.ts b/packages/nuxt/src/app/composables/fetch.ts
index c4c1d2b083..a3cb38fc51 100644
--- a/packages/nuxt/src/app/composables/fetch.ts
+++ b/packages/nuxt/src/app/composables/fetch.ts
@@ -13,7 +13,7 @@ type AvailableRouterMethod<R extends NitroFetchRequest> = _AvailableRouterMethod
 export type FetchResult<ReqT extends NitroFetchRequest, M extends AvailableRouterMethod<ReqT>> = TypedInternalResponse<ReqT, unknown, Lowercase<M>>
 
 type ComputedOptions<T extends Record<string, any>> = {
-  [K in keyof T]: T[K] extends Function ? T[K] : T[K] extends Record<string, any> ? ComputedOptions<T[K]> | Ref<T[K]> | T[K] : Ref<T[K]> | T[K]
+  [K in keyof T]: T[K] extends Function ? T[K] : ComputedOptions<T[K]> | Ref<T[K]> | T[K]
 }
 
 interface NitroFetchOptions<R extends NitroFetchRequest, M extends AvailableRouterMethod<R> = AvailableRouterMethod<R>> extends FetchOptions {
diff --git a/test/fixtures/basic-types/types.ts b/test/fixtures/basic-types/types.ts
index 11baf9366f..3f692400c1 100644
--- a/test/fixtures/basic-types/types.ts
+++ b/test/fixtures/basic-types/types.ts
@@ -406,6 +406,17 @@ describe('composables', () => {
     expectTypeOf(test).toEqualTypeOf<string | undefined>()
   })
 
+  it('allows passing reactive values in useFetch', () => {
+    useFetch('/api/hey', {
+      headers: {
+        key: ref('test')
+      },
+      query: {
+        param: computed(() => 'thing')
+      }
+    })
+  })
+
   it('correctly types returns with key signatures', () => {
     interface TestType {
       id: string