diff --git a/.nextchanges/bundles/merge-null-target-override.md b/.nextchanges/bundles/merge-null-target-override.md
new file mode 100644
index 00000000000..fd545e97e3f
--- /dev/null
+++ b/.nextchanges/bundles/merge-null-target-override.md
@@ -0,0 +1 @@
+* Fix a target override setting a field to `null` (e.g. `autoscale: null`) being ignored; the field now drops the value inherited from the base configuration instead of keeping it ([#5701](https://github.com/databricks/cli/issues/5701)).
diff --git a/acceptance/bundle/override/clusters/databricks.yml b/acceptance/bundle/override/clusters/databricks.yml
index 65afcca00c6..6bd8fbbb9d6 100644
--- a/acceptance/bundle/override/clusters/databricks.yml
+++ b/acceptance/bundle/override/clusters/databricks.yml
@@ -31,3 +31,10 @@ targets:
           spark_conf:
             "spark.executor.memory": "4g"
             "spark.executor.memory2": "4g"
+
+  # Setting autoscale to null in a target drops the inherited autoscale block.
+  no_autoscale:
+    resources:
+      clusters:
+        foo:
+          autoscale: null
diff --git a/acceptance/bundle/override/clusters/output.txt b/acceptance/bundle/override/clusters/output.txt
index 1c26581d399..2366ebd52ba 100644
--- a/acceptance/bundle/override/clusters/output.txt
+++ b/acceptance/bundle/override/clusters/output.txt
@@ -31,3 +31,16 @@
   },
   "spark_version": "15.2.x-scala2.12"
 }
+
+>>> [CLI] bundle validate -o json -t no_autoscale
+{
+  "autoscale": null,
+  "autotermination_minutes": 60,
+  "cluster_name": "foo",
+  "node_type_id": "[NODE_TYPE_ID]",
+  "num_workers": 2,
+  "spark_conf": {
+    "spark.executor.memory": "2g"
+  },
+  "spark_version": "13.3.x-scala2.12"
+}
diff --git a/acceptance/bundle/override/clusters/script b/acceptance/bundle/override/clusters/script
index 4a73dd93e0b..e8386e81658 100644
--- a/acceptance/bundle/override/clusters/script
+++ b/acceptance/bundle/override/clusters/script
@@ -1,2 +1,3 @@
 trace $CLI bundle validate -o json -t default | jq .resources.clusters.foo
 trace $CLI bundle validate -o json -t development | jq .resources.clusters.foo
+trace $CLI bundle validate -o json -t no_autoscale | jq .resources.clusters.foo
diff --git a/libs/dyn/merge/merge.go b/libs/dyn/merge/merge.go
index 374450ef240..85fb9298043 100644
--- a/libs/dyn/merge/merge.go
+++ b/libs/dyn/merge/merge.go
@@ -10,7 +10,7 @@ import (
 //
 // Semantics are as follows:
 // * Merging x with nil or nil with x always yields x.
-// * Merging maps a and b means entries from map b take precedence.
+// * Merging maps a and b means entries from map b take precedence. A nil entry in b clears the corresponding entry in a.
 // * Merging sequences a and b means concatenating them.
 //
 // Merging retains and accumulates the locations metadata associated with the values.
@@ -84,6 +84,13 @@ func mergeMap(a, b dyn.Value) (dyn.Value, error) {
 		key := pk.MustString()
 		pv := pair.Value
 		if ov, ok := out.Get(pk); ok {
+			// An explicit nil in the incoming map clears the existing value instead
+			// of being ignored, so a target can drop an inherited field (e.g. set
+			// `autoscale: null` to remove an inherited autoscale block).
+			if pv.Kind() == dyn.KindNil {
+				out.SetLoc(key, pair.Key.Locations(), pv.AppendLocationsFromValue(ov))
+				continue
+			}
 			// If the key already exists, merge the values.
 			merged, err := merge(ov, pv)
 			if err != nil {
diff --git a/libs/dyn/merge/merge_test.go b/libs/dyn/merge/merge_test.go
index 43e0e08c182..81cc136259d 100644
--- a/libs/dyn/merge/merge_test.go
+++ b/libs/dyn/merge/merge_test.go
@@ -117,6 +117,40 @@ func TestMergeMapsNil(t *testing.T) {
 	}
 }
 
+func TestMergeMapsNilEntryClearsExisting(t *testing.T) {
+	l1 := dyn.Location{File: "base", Line: 1, Column: 2}
+	base := dyn.NewValue(map[string]dyn.Value{
+		"foo": dyn.NewValue("bar", []dyn.Location{l1}),
+		"autoscale": dyn.NewValue(map[string]dyn.Value{
+			"min_workers": dyn.NewValue(1, []dyn.Location{l1}),
+			"max_workers": dyn.NewValue(2, []dyn.Location{l1}),
+		}, []dyn.Location{l1}),
+	}, []dyn.Location{l1})
+
+	l2 := dyn.Location{File: "target", Line: 3, Column: 4}
+	override := dyn.NewValue(map[string]dyn.Value{
+		"autoscale": dyn.NewValue(nil, []dyn.Location{l2}),
+	}, []dyn.Location{l2})
+
+	out, err := Merge(base, override)
+	assert.NoError(t, err)
+
+	// An explicit nil in the override clears the inherited value rather than
+	// leaving the base in place.
+	assert.Equal(t, map[string]any{
+		"foo":       "bar",
+		"autoscale": nil,
+	}, out.AsAny())
+	assert.Equal(t, dyn.KindNil, out.Get("autoscale").Kind())
+
+	// The override's location wins and the base location is accumulated.
+	assert.Equal(t, l2, out.Get("autoscale").Location())
+	assert.Equal(t, []dyn.Location{l2, l1}, out.Get("autoscale").Locations())
+
+	// Keys not present in the override are untouched.
+	assert.Equal(t, "bar", out.Get("foo").AsAny())
+}
+
 func TestMergeMapsError(t *testing.T) {
 	v := dyn.V(map[string]dyn.Value{
 		"foo": dyn.V("bar"),