diff --git a/src/systems/parameter_buffer.jl b/src/systems/parameter_buffer.jl
index 7ccd38c990..96ae828d7f 100644
--- a/src/systems/parameter_buffer.jl
+++ b/src/systems/parameter_buffer.jl
@@ -38,6 +38,11 @@ function MTKParameters(
     elseif u0 === nothing || isempty(u0)
         u0 = Dict()
     end
+    for sym in keys(u0)
+        if is_parameter(sys, sym)
+            error("Encountered parameter $sym in initial conditions")
+        end
+    end
     defs = merge(defs, u0)
     defs = merge(Dict(eq.lhs => eq.rhs for eq in observed(sys)), defs)
     p = merge(defs, p)
diff --git a/test/mtkparameters.jl b/test/mtkparameters.jl
index 86ae4dd78a..f26d96a002 100644
--- a/test/mtkparameters.jl
+++ b/test/mtkparameters.jl
@@ -224,3 +224,15 @@ function loss(x)
 end
 
 @test_nowarn ForwardDiff.gradient(loss, collect(tunables))
+
+# Issue#2692
+@variables x(t)
+@parameters p d
+@mtkbuild osys = ODESystem(D(x) ~ p - d * x, t)
+u0 = [x => 5.0, d => 0.2]
+ps = [p => 5.0]
+@test_throws "Encountered parameter $d in initial conditions" ODEProblem(
+    osys, u0, (0.0, 1.0), ps)
+u0 = [x => 5.0]
+ps = [p => 5.0, d => 0.2]
+@test_nowarn ODEProblem(osys, u0, (0.0, 1.0), ps)