GLOSSARY / DEFINITION
What is OpenTofu
OpenTofu is the open source fork of Terraform created in 2023 after HashiCorp moved Terraform to the Business Source License. For enterprises that adopted Terraform as open source infrastructure, OpenTofu is the continued open path, and understanding what it is comes first in deciding whether to migrate.
Definition
OpenTofu is a community driven fork of Terraform, the infrastructure as code tool used to define and provision cloud and on premises resources. It was created in 2023, shortly after HashiCorp changed the Terraform license, by taking the last open source Terraform release and continuing development under a new project name. OpenTofu is maintained under the Linux Foundation and is licensed under the Mozilla Public License 2.0, an approved open source license, which keeps it firmly within open source as defined by the Open Source Initiative. In plain terms, OpenTofu is where the open source Terraform lineage continued after the original tool moved to source available terms.
Why OpenTofu exists
OpenTofu exists because of the HashiCorp license change as of August 2023, when HashiCorp moved Terraform, Vault, Consul, Nomad, and Packer to the Business Source License 1.1. The Business Source License is source available, not open source, and it restricts competitive production use for a delay period, commonly four years, after which each version converts to an open license. Contributors and companies that depended on an open source Terraform responded by forking the last open source release and continuing it as OpenTofu under the Linux Foundation. This mirrors the broader relicensing wave, in which Valkey forked from Redis and OpenSearch forked from Elasticsearch. The full fork story is told in the OpenTofu and Valkey fork story, and the license itself is defined in what is the Business Source License.
What it means for license risk
For a buyer, OpenTofu matters because it offers a way out of the Business Source License without abandoning the Terraform workflow. Migrating from Terraform to OpenTofu replaces a source available license with the open source Mozilla Public License 2.0, which removes the competitive use restriction that the Business Source License introduced. Because OpenTofu began as a fork of the last open source Terraform release, it aims to be broadly compatible, and for many deployments it functions as a drop in alternative. The tradeoff is that a migration is still a project, and the two tools can diverge over time, so compatibility should be confirmed for the specific Terraform version, providers, and features in use. The decision therefore weighs a cleaner license posture against engineering effort and the maturity of the fork, a choice examined in Terraform vs OpenTofu compared.
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Questions buyers ask.
What is OpenTofu?
OpenTofu is an open source fork of Terraform created in 2023 after HashiCorp moved Terraform to the Business Source License. It is maintained under the Linux Foundation and licensed under the Mozilla Public License 2.0, an approved open source license, so it remains open source. It is designed as a drop in compatible alternative to the Terraform versions from before the license change.
Why was OpenTofu created?
OpenTofu was created in response to the HashiCorp license change as of August 2023, which moved Terraform and other tools to the Business Source License, a source available license that is not open source. Contributors and companies that relied on an open source Terraform forked the last open source release and continued it as OpenTofu under the Linux Foundation.
Is OpenTofu compatible with Terraform?
OpenTofu began as a fork of the last open source Terraform release and aims to remain broadly compatible, so for many deployments it functions as a drop in alternative. The projects can diverge over time, so a buyer should confirm compatibility for the specific Terraform version, providers, and features in use rather than assume permanent parity.
Does moving to OpenTofu remove the Terraform BSL risk?
Moving to OpenTofu replaces the Business Source License with the open source Mozilla Public License 2.0, which removes the competitive use restriction the BSL introduced. It introduces a migration project and a dependency on a newer fork, so the decision weighs license posture against engineering cost and project maturity.
Is this definition legal advice?
No. This is commercial and licensing risk advisory, not legal advice. For interpretation of the Terraform license, the OpenTofu license, or any migration question, engage your own counsel.