OpenTofu vs Terraform: Navigating the Future of Infrastructure as Code

Infrastructure as Code (IaC) has transformed how modern teams build, scale, and manage cloud infrastructure. Among the leading tools in this space, Terraform has long been the standard for declarative infrastructure provisioning. However, recent changes to its licensing model prompted the open-source community to respond with OpenTofu, a fully open alternative.

Why OpenTofu Was Created

Terraform, originally licensed under the open-source Mozilla Public License (MPL), enabled developers, organizations, and platforms to freely use, modify, and distribute the software. This open model was a cornerstone of its widespread adoption.

In August 2023, HashiCorp announced a shift to the Business Source License (BSL) for Terraform. This license limits usage in commercial offerings that compete with HashiCorp’s business, introducing legal and operational uncertainties for many companies.

In response, the community created opentofu vs terraform fork governed by the Linux Foundation and licensed under the permissive MPL 2.0. Its mission: preserve an open, community-driven path for infrastructure as code.

Key Differences: OpenTofu vs Terraform

Although OpenTofu started as a direct fork of Terraform and remains compatible today, key differences are emerging across governance, licensing, and future direction.

1. Licensing and Legal Clarity

• Terraform now operates under the BSL, restricting commercial redistribution and usage in certain contexts.

• OpenTofu retains a permissive open-source license (MPL 2.0), ensuring long-term freedom for all use cases.

Kapstan’s Perspective: Organizations building platforms or internal tooling benefit from OpenTofu’s clear, open licensing, avoiding potential legal ambiguity introduced by the BSL.

2. Governance and Community Involvement

• Terraform is governed solely by HashiCorp, with decisions aligned to their commercial priorities.

• OpenTofu is community-governed, with oversight from the Linux Foundation, promoting transparency and collaboration.

Why It Matters: OpenTofu empowers users and contributors to influence development direction, which is critical for long-term innovation and trust in open infrastructure tools.

3. Compatibility and Ecosystem

At present, OpenTofu maintains full compatibility with the Terraform provider and module ecosystem. Most Terraform configurations can be used with OpenTofu without modification.

However, as the projects evolve, future divergences may occur. Proprietary Terraform features or enterprise modules may not be adopted by OpenTofu, while OpenTofu could develop its own community-driven enhancements.

Kapstan’s Guidance: Teams should monitor the roadmap of both tools and evaluate ecosystem support, especially if their workflows depend on specific providers or features.

4. Roadmap and Development Priorities

• Terraform’s roadmap is designed to support HashiCorp’s commercial offerings, such as Terraform Cloud and Terraform Enterprise.

• OpenTofu is focused on maintaining an open, community-led roadmap that prioritizes developer needs, vendor neutrality, and cloud interoperability.

Strategic Consideration: OpenTofu may be more aligned with organizations that prioritize flexibility, openness, and control over their infrastructure tooling.

Choosing Between OpenTofu and Terraform

The decision to adopt OpenTofu or remain with Terraform depends on your organization’s priorities, use cases, and risk tolerance.

Choose OpenTofu if:

• You require clear, unencumbered open-source licensing.

• You’re developing commercial tools or platforms that embed IaC functionality.

• You prefer a transparent and community-driven development model.

• You want to avoid vendor lock-in or reliance on proprietary tools.

Choose Terraform if:

• You already rely heavily on HashiCorp’s commercial ecosystem (e.g., Vault, Consul, Terraform Enterprise).

• Your organization is comfortable with the BSL and does not distribute Terraform commercially.

• You prefer the stability and support associated with a single-vendor tool.

Migrating from Terraform to OpenTofu

Because OpenTofu is a drop-in replacement for Terraform, migration is generally straightforward:

1. Replace the CLI: Install the OpenTofu binary in place of the Terraform CLI.

2. Run a Plan: Validate your existing configurations and state files.

3. Test Thoroughly: Ensure your workflows and automation pipelines function as expected, especially in CI/CD environments.

4. Monitor Community Modules: Watch for updates or enhancements unique to OpenTofu’s ecosystem.

Kapstan Offers Support: If your organization is considering a migration to OpenTofu, Kapstan provides strategic advisory, implementation support, and infrastructure audits to ensure a seamless transition.

Looking Ahead: The Future of IaC is Open

The emergence of OpenTofu represents more than just a fork in code—it’s a reflection of the broader desire for open, transparent, and community-driven infrastructure tooling. While Terraform remains a mature and widely adopted solution, OpenTofu is gaining momentum as the open-source community rallies behind its mission.

At Kapstan, we believe that the future of infrastructure automation lies in open, flexible, and cloud-agnostic tooling. Whether you're building a platform, optimizing your DevOps pipelines, or planning a migration strategy, our team is here to help you navigate the evolving landscape of Infrastructure as Code.