Locals vs Variables: Understanding Scope and Purpose

While seemingly simple, the distinction between locals and variables is a frequent source of confusion.

The Problem

# Attempting to use locals in variable defaults (DOESN'T WORK)
locals {
  environment_prefix = substr(var.environment, 0, 1)
}

variable "resource_name" {
  default = "${local.environment_prefix}-resource" # ERROR: Can't reference locals here
}

The Solution

# Proper use of variables and locals
variable "environment" {
  type = string
}

variable "resource_name_prefix" {
  type    = string
  default = "resource"
}

locals {
  environment_prefix = substr(var.environment, 0, 1)
  resource_name      = "${local.environment_prefix}-${var.resource_name_prefix}"
}

resource "aws_s3_bucket" "example" {
  bucket = local.resource_name
}

Locals are for internal calculations, while variables are for external inputs. Scalr's policy engine can help enforce this distinction by validating the structure of your code.