diff --git a/packages/next/client/components/layout-router.client.tsx b/packages/next/client/components/layout-router.client.tsx
index f79d188ef0b7..ed96a6fb390f 100644
--- a/packages/next/client/components/layout-router.client.tsx
+++ b/packages/next/client/components/layout-router.client.tsx
@@ -278,11 +278,14 @@ export function InnerLayoutRouter({
 function LoadingBoundary({
   children,
   loading,
+  hasLoading,
 }: {
   children: React.ReactNode
   loading?: React.ReactNode
+  hasLoading: boolean
 }): JSX.Element {
-  if (loading) {
+  if (hasLoading) {
+    // @ts-expect-error TODO-APP: React.Suspense fallback type is wrong
     return <React.Suspense fallback={loading}>{children}</React.Suspense>
   }
 
@@ -450,6 +453,7 @@ export default function OuterLayoutRouter({
   childProp,
   error,
   loading,
+  hasLoading,
   template,
   notFound,
   rootLayoutIncluded,
@@ -460,6 +464,7 @@ export default function OuterLayoutRouter({
   error: ErrorComponent
   template: React.ReactNode
   loading: React.ReactNode | undefined
+  hasLoading: boolean
   notFound: React.ReactNode | undefined
   rootLayoutIncluded: boolean
 }) {
@@ -510,7 +515,7 @@ export default function OuterLayoutRouter({
             key={preservedSegment}
             value={
               <ErrorBoundary errorComponent={error}>
-                <LoadingBoundary loading={loading}>
+                <LoadingBoundary hasLoading={hasLoading} loading={loading}>
                   <NotFoundBoundary notFound={notFound}>
                     <RedirectBoundary>
                       <InnerLayoutRouter
diff --git a/packages/next/server/app-render.tsx b/packages/next/server/app-render.tsx
index 3d1120d96590..6b1f8d9572ff 100644
--- a/packages/next/server/app-render.tsx
+++ b/packages/next/server/app-render.tsx
@@ -942,6 +942,7 @@ export async function renderToHTMLOrFlight(
                   parallelRouterKey={parallelRouteKey}
                   segmentPath={createSegmentPath(currentSegmentPath)}
                   loading={Loading ? <Loading /> : undefined}
+                  hasLoading={Boolean(Loading)}
                   error={ErrorComponent}
                   template={
                     <Template>
@@ -982,6 +983,8 @@ export async function renderToHTMLOrFlight(
                 segmentPath={segmentPath}
                 error={ErrorComponent}
                 loading={Loading ? <Loading /> : undefined}
+                // TODO-APP: Add test for loading returning `undefined`. This currently can't be tested as the `webdriver()` tab will wait for the full page to load before returning.
+                hasLoading={Boolean(Loading)}
                 template={
                   <Template>
                     <RenderFromTemplateContext />