diff --git a/config/config.go b/config/config.go
index e0733081f5..b4b405107e 100644
--- a/config/config.go
+++ b/config/config.go
@@ -127,7 +127,7 @@ func (c *Config) Validate() error {
 			"Unknown root level key: %s", k))
 	}
 
-	vars := c.allVariables()
+	vars := c.InterpolatedVariables()
 	varMap := make(map[string]*Variable)
 	for _, v := range c.Variables {
 		varMap[v.Name] = v
@@ -302,10 +302,10 @@ func (c *Config) Validate() error {
 	return nil
 }
 
-// allVariables is a helper that returns a mapping of all the interpolated
+// InterpolatedVariables is a helper that returns a mapping of all the interpolated
 // variables within the configuration. This is used to verify references
 // are valid in the Validate step.
-func (c *Config) allVariables() map[string][]InterpolatedVariable {
+func (c *Config) InterpolatedVariables() map[string][]InterpolatedVariable {
 	result := make(map[string][]InterpolatedVariable)
 	for _, pc := range c.ProviderConfigs {
 		source := fmt.Sprintf("provider config '%s'", pc.Name)
diff --git a/config/module/test-fixtures/validate-bad-output/child/main.tf b/config/module/test-fixtures/validate-bad-output/child/main.tf
new file mode 100644
index 0000000000..e69de29bb2
diff --git a/config/module/test-fixtures/validate-bad-output/main.tf b/config/module/test-fixtures/validate-bad-output/main.tf
new file mode 100644
index 0000000000..a19233e12d
--- /dev/null
+++ b/config/module/test-fixtures/validate-bad-output/main.tf
@@ -0,0 +1,7 @@
+module "child" {
+    source = "./child"
+}
+
+resource "aws_instance" "foo" {
+    memory = "${module.child.memory}"
+}
diff --git a/config/module/test-fixtures/validate-child-good/child/main.tf b/config/module/test-fixtures/validate-child-good/child/main.tf
index 618ae3c42e..2cfd2a80f5 100644
--- a/config/module/test-fixtures/validate-child-good/child/main.tf
+++ b/config/module/test-fixtures/validate-child-good/child/main.tf
@@ -1 +1,3 @@
 variable "memory" {}
+
+output "result" {}
diff --git a/config/module/test-fixtures/validate-child-good/main.tf b/config/module/test-fixtures/validate-child-good/main.tf
index 7c70782f1b..5f3ad8da5b 100644
--- a/config/module/test-fixtures/validate-child-good/main.tf
+++ b/config/module/test-fixtures/validate-child-good/main.tf
@@ -2,3 +2,7 @@ module "child" {
     source = "./child"
     memory = "1G"
 }
+
+resource "aws_instance" "foo" {
+    memory = "${module.child.result}"
+}
diff --git a/config/module/tree.go b/config/module/tree.go
index 867f812c84..ed1b2b3dea 100644
--- a/config/module/tree.go
+++ b/config/module/tree.go
@@ -267,6 +267,37 @@ func (t *Tree) Validate() error {
 		}
 	}
 
+	// Go over all the variables used and make sure that any module
+	// variables represent outputs properly.
+	for source, vs := range t.config.InterpolatedVariables() {
+		for _, v := range vs {
+			mv, ok := v.(*config.ModuleVariable)
+			if !ok {
+				continue
+			}
+
+			tree, ok := children[mv.Name]
+			if !ok {
+				// This should never happen because Load watches us
+				panic("module not found in children: " + mv.Name)
+			}
+
+			found := false
+			for _, o := range tree.config.Outputs {
+				if o.Name == mv.Field {
+					found = true
+					break
+				}
+			}
+			if !found {
+				newErr.Err = fmt.Errorf(
+					"%s: %s is not a valid output for module %s",
+					source, mv.Field, mv.Name)
+				return newErr
+			}
+		}
+	}
+
 	return nil
 }
 
diff --git a/config/module/tree_test.go b/config/module/tree_test.go
index 3fbad23d73..d2fc41a5e9 100644
--- a/config/module/tree_test.go
+++ b/config/module/tree_test.go
@@ -92,6 +92,18 @@ func TestTreeValidate_badChild(t *testing.T) {
 	}
 }
 
+func TestTreeValidate_badChildOutput(t *testing.T) {
+	tree := NewTree(testConfig(t, "validate-bad-output"))
+
+	if err := tree.Load(testStorage(t), GetModeGet); err != nil {
+		t.Fatalf("err: %s", err)
+	}
+
+	if err := tree.Validate(); err == nil {
+		t.Fatal("should error")
+	}
+}
+
 func TestTreeValidate_badChildVar(t *testing.T) {
 	tree := NewTree(testConfig(t, "validate-bad-var"))