diff --git a/pkg/chart/common/util/coalesce.go b/pkg/chart/common/util/coalesce.go
index 07794a04a..6c72b3d56 100644
--- a/pkg/chart/common/util/coalesce.go
+++ b/pkg/chart/common/util/coalesce.go
@@ -302,6 +302,15 @@ func coalesceTablesFullKey(printf printFn, dst, src map[string]interface{}, pref
 	if dst == nil {
 		return src
 	}
+	// Track original non-nil src keys before modifying src
+	// This lets us distinguish between user nullifying a chart default vs
+	// user setting nil for a key not in chart defaults.
+	srcOriginalNonNil := make(map[string]bool)
+	for key, val := range src {
+		if val != nil {
+			srcOriginalNonNil[key] = true
+		}
+	}
 	for key, val := range dst {
 		if val == nil {
 			src[key] = nil
@@ -311,9 +320,13 @@ func coalesceTablesFullKey(printf printFn, dst, src map[string]interface{}, pref
 	// values.
 	for key, val := range src {
 		fullkey := concatPrefix(prefix, key)
-		if dv, ok := dst[key]; ok && !merge && dv == nil {
+		if dv, ok := dst[key]; ok && !merge && dv == nil && srcOriginalNonNil[key] {
+			// When coalescing (not merging), if dst has nil and src has a non-nil
+			// value, the user is nullifying a chart default - remove the key.
+			// But if src also has nil (or key not in src), preserve the nil
 			delete(dst, key)
 		} else if !ok {
+			// key not in user values, preserve src value (including nil)
 			dst[key] = val
 		} else if istable(val) {
 			if istable(dv) {
diff --git a/pkg/chart/common/util/coalesce_test.go b/pkg/chart/common/util/coalesce_test.go
index 871bfa8da..4eaf4be2b 100644
--- a/pkg/chart/common/util/coalesce_test.go
+++ b/pkg/chart/common/util/coalesce_test.go
@@ -731,3 +731,37 @@ func TestConcatPrefix(t *testing.T) {
 	assert.Equal(t, "b", concatPrefix("", "b"))
 	assert.Equal(t, "a.b", concatPrefix("a", "b"))
 }
+
+// TestCoalesceValuesEmptyMapWithNils tests the full CoalesceValues scenario
+// from issue #31643 where chart has data: {} and user provides data: {foo: bar, baz: ~}
+func TestCoalesceValuesEmptyMapWithNils(t *testing.T) {
+	is := assert.New(t)
+
+	c := &chart.Chart{
+		Metadata: &chart.Metadata{Name: "test"},
+		Values: map[string]any{
+			"data": map[string]any{}, // empty map in chart defaults
+		},
+	}
+
+	vals := map[string]any{
+		"data": map[string]any{
+			"foo": "bar",
+			"baz": nil, // explicit nil from user
+		},
+	}
+
+	v, err := CoalesceValues(c, vals)
+	is.NoError(err)
+
+	data, ok := v["data"].(map[string]any)
+	is.True(ok, "data is not a map")
+
+	// "foo" should be preserved
+	is.Equal("bar", data["foo"])
+
+	// "baz" should be preserved with nil value since it wasn't in chart defaults
+	_, ok = data["baz"]
+	is.True(ok, "Expected data.baz key to be present but it was removed")
+	is.Nil(data["baz"], "Expected data.baz key to be nil but it is not")
+}