diff --git a/arrow/src/util/decimal.rs b/arrow/src/util/decimal.rs
index e5fa70d877a..67e68496326 100644
--- a/arrow/src/util/decimal.rs
+++ b/arrow/src/util/decimal.rs
@@ -19,7 +19,7 @@
 
 use crate::error::{ArrowError, Result};
 use num::bigint::BigInt;
-use std::cmp::Ordering;
+use std::cmp::{min, Ordering};
 
 pub trait BasicDecimal: PartialOrd + Ord + PartialEq + Eq {
     /// The bit-width of the internal representation.
@@ -36,6 +36,13 @@ pub trait BasicDecimal: PartialOrd + Ord + PartialEq + Eq {
     where
         Self: Sized,
     {
+        if precision < scale {
+            return Err(ArrowError::InvalidArgumentError(format!(
+                "Precision {} is less than scale {}",
+                precision, scale
+            )));
+        }
+
         if bytes.len() == Self::BIT_WIDTH / 8 {
             Ok(Self::new(precision, scale, bytes))
         } else {
@@ -64,6 +71,8 @@ pub trait BasicDecimal: PartialOrd + Ord + PartialEq + Eq {
     fn scale(&self) -> usize;
 
     /// Returns the string representation of the decimal.
+    /// If the string representation cannot be fitted with the precision of the decimal,
+    /// the string will be truncated.
     fn as_string(&self) -> String {
         let raw_bytes = self.raw_value();
         let integer = BigInt::from_signed_bytes_le(raw_bytes);
@@ -77,6 +86,11 @@ pub trait BasicDecimal: PartialOrd + Ord + PartialEq + Eq {
 
             if rest.len() > self.scale() {
                 // Decimal separator is in the middle of the string
+                let mut bound = min(self.precision(), rest.len());
+                if sign.len() == 1 {
+                    bound += 1;
+                }
+                let value_str = value_str[0..bound].to_string();
                 let (whole, decimal) = value_str.split_at(value_str.len() - self.scale());
                 format!("{}.{}", whole, decimal)
             } else {
@@ -99,7 +113,7 @@ pub struct Decimal128 {
 
 impl Decimal128 {
     /// Creates `Decimal128` from an `i128` value.
-    pub fn new_from_i128(precision: usize, scale: usize, value: i128) -> Self {
+    pub(crate) fn new_from_i128(precision: usize, scale: usize, value: i128) -> Self {
         Decimal128 {
             precision,
             scale,
@@ -208,6 +222,13 @@ mod tests {
         assert_eq!(value.as_string(), "0.100");
     }
 
+    #[test]
+    fn decimal_invalid_precision_scale() {
+        let bytes = 100_i128.to_le_bytes();
+        let err = Decimal128::try_new_from_bytes(5, 6, &bytes);
+        assert!(err.is_err());
+    }
+
     #[test]
     fn decimal_128_from_bytes() {
         let mut bytes = 100_i128.to_le_bytes();
@@ -219,18 +240,24 @@ mod tests {
         assert_eq!(value.as_string(), "-0.01");
 
         bytes = i128::MAX.to_le_bytes();
-        let value = Decimal128::try_new_from_bytes(5, 2, &bytes).unwrap();
-        assert_eq!(
-            value.as_string(),
-            "1701411834604692317316873037158841057.27"
-        );
+        let value = Decimal128::try_new_from_bytes(38, 2, &bytes).unwrap();
+        assert_eq!(value.as_string(), "170141183460469231731687303715884105.72");
 
         bytes = i128::MIN.to_le_bytes();
-        let value = Decimal128::try_new_from_bytes(5, 2, &bytes).unwrap();
+        let value = Decimal128::try_new_from_bytes(38, 2, &bytes).unwrap();
         assert_eq!(
             value.as_string(),
-            "-1701411834604692317316873037158841057.28"
+            "-170141183460469231731687303715884105.72"
         );
+
+        // Truncated
+        bytes = 12345_i128.to_le_bytes();
+        let value = Decimal128::try_new_from_bytes(3, 2, &bytes).unwrap();
+        assert_eq!(value.as_string(), "1.23");
+
+        bytes = (-12345_i128).to_le_bytes();
+        let value = Decimal128::try_new_from_bytes(3, 2, &bytes).unwrap();
+        assert_eq!(value.as_string(), "-1.23");
     }
 
     #[test]
@@ -241,7 +268,7 @@ mod tests {
         assert_eq!(value.as_string(), "1.00");
 
         bytes[0..16].clone_from_slice(&i128::MAX.to_le_bytes());
-        let value = Decimal256::try_new_from_bytes(5, 4, &bytes).unwrap();
+        let value = Decimal256::try_new_from_bytes(40, 4, &bytes).unwrap();
         assert_eq!(
             value.as_string(),
             "17014118346046923173168730371588410.5727"