diff --git a/sway-core/src/transform/to_parsed_lang/convert_parse_tree.rs b/sway-core/src/transform/to_parsed_lang/convert_parse_tree.rs
index 642badfeadf..4144d0b085c 100644
--- a/sway-core/src/transform/to_parsed_lang/convert_parse_tree.rs
+++ b/sway-core/src/transform/to_parsed_lang/convert_parse_tree.rs
@@ -4943,8 +4943,13 @@ pub fn cfg_eval(
                         }
                     },
                     _ => {
-                        // Already checked with `AttributeKind::expected_args_*`
-                        unreachable!("cfg attribute should only have the `target` or the `program_type` argument");
+                        return Err(handler.emit_err(
+                            ConvertParseTreeError::InvalidCfgArg {
+                                span: arg.span(),
+                                value: arg.name.as_str().to_string(),
+                            }
+                            .into(),
+                        ));
                     }
                 }
             }
diff --git a/sway-error/src/convert_parse_tree_error.rs b/sway-error/src/convert_parse_tree_error.rs
index 2fdfdc58d75..6c909e2016e 100644
--- a/sway-error/src/convert_parse_tree_error.rs
+++ b/sway-error/src/convert_parse_tree_error.rs
@@ -119,6 +119,8 @@ pub enum ConvertParseTreeError {
     ExpectedCfgProgramTypeArgValue { span: Span },
     #[error("Expected \"true\" or \"false\" for experimental_new_encoding")]
     ExpectedExperimentalNewEncodingArgValue { span: Span },
+    #[error("Unexpected attribute value: \"{value}\" for attribute: \"cfg\"")]
+    InvalidCfgArg { span: Span, value: String },
 }
 
 impl Spanned for ConvertParseTreeError {
@@ -182,6 +184,7 @@ impl Spanned for ConvertParseTreeError {
             ConvertParseTreeError::InvalidCfgProgramTypeArgValue { span, .. } => span.clone(),
             ConvertParseTreeError::ExpectedCfgProgramTypeArgValue { span } => span.clone(),
             ConvertParseTreeError::ExpectedExperimentalNewEncodingArgValue { span } => span.clone(),
+            ConvertParseTreeError::InvalidCfgArg { span, .. } => span.clone(),
         }
     }
 }
diff --git a/test/src/e2e_vm_tests/test_programs/should_fail/invalid_cfg_arg/Forc.lock b/test/src/e2e_vm_tests/test_programs/should_fail/invalid_cfg_arg/Forc.lock
new file mode 100644
index 00000000000..1cef6b3f7a1
--- /dev/null
+++ b/test/src/e2e_vm_tests/test_programs/should_fail/invalid_cfg_arg/Forc.lock
@@ -0,0 +1,3 @@
+[[package]]
+name = "invalid_cfg_arg"
+source = "member"
diff --git a/test/src/e2e_vm_tests/test_programs/should_fail/invalid_cfg_arg/Forc.toml b/test/src/e2e_vm_tests/test_programs/should_fail/invalid_cfg_arg/Forc.toml
new file mode 100644
index 00000000000..582fa8b5e47
--- /dev/null
+++ b/test/src/e2e_vm_tests/test_programs/should_fail/invalid_cfg_arg/Forc.toml
@@ -0,0 +1,6 @@
+[project]
+name = "invalid_cfg_arg"
+authors = ["Fuel Labs <contact@fuel.sh>"]
+entry = "main.sw"
+license = "Apache-2.0"
+implicit-std = false
diff --git a/test/src/e2e_vm_tests/test_programs/should_fail/invalid_cfg_arg/src/main.sw b/test/src/e2e_vm_tests/test_programs/should_fail/invalid_cfg_arg/src/main.sw
new file mode 100644
index 00000000000..c9ad0835d76
--- /dev/null
+++ b/test/src/e2e_vm_tests/test_programs/should_fail/invalid_cfg_arg/src/main.sw
@@ -0,0 +1,2 @@
+predicate;
+#[cfg(c)] a
diff --git a/test/src/e2e_vm_tests/test_programs/should_fail/invalid_cfg_arg/test.toml b/test/src/e2e_vm_tests/test_programs/should_fail/invalid_cfg_arg/test.toml
new file mode 100644
index 00000000000..1f48bdf0556
--- /dev/null
+++ b/test/src/e2e_vm_tests/test_programs/should_fail/invalid_cfg_arg/test.toml
@@ -0,0 +1,10 @@
+category = "fail"
+
+# check: $()#[cfg(c)] a
+# nextln: $()Unexpected attribute value: "c" for attribute: "cfg" expected value "target" or "program_type" or "experimental_new_encoding"
+
+# check: $()#[cfg(c)] a
+# nextln: $()Expected an item.
+
+# check: $()#[cfg(c)] a
+# nextln: $()Unexpected attribute value: "c" for attribute: "cfg"
\ No newline at end of file