diff --git a/public/app/plugins/datasource/loki/querySplitting.test.ts b/public/app/plugins/datasource/loki/querySplitting.test.ts
index e57c3053c32..82a585739aa 100644
--- a/public/app/plugins/datasource/loki/querySplitting.test.ts
+++ b/public/app/plugins/datasource/loki/querySplitting.test.ts
@@ -72,6 +72,21 @@ describe('runSplitQuery()', () => {
     });
   });
 
+  test('Interpolates queries before execution', async () => {
+    const request = createRequest([{ expr: 'count_over_time({a="b"}[$__auto])', refId: 'A', step: '$step' }]);
+    datasource = createLokiDatasource({
+      replace: (input = '') => {
+        return input.replace('$__auto', '5m').replace('$step', '5m');
+      },
+      getVariables: () => [],
+    });
+    jest.spyOn(datasource, 'runQuery').mockReturnValue(of({ data: [] }));
+    await expect(runSplitQuery(datasource, request)).toEmitValuesWith(() => {
+      expect(jest.mocked(datasource.runQuery).mock.calls[0][0].targets[0].expr).toBe('count_over_time({a="b"}[5m])');
+      expect(jest.mocked(datasource.runQuery).mock.calls[0][0].targets[0].step).toBe('5m');
+    });
+  });
+
   test('Skips partial updates as an option', async () => {
     await expect(runSplitQuery(datasource, request, { skipPartialUpdates: true })).toEmitValuesWith((emitted) => {
       // 3 days, 3 chunks, 3 requests.
diff --git a/public/app/plugins/datasource/loki/querySplitting.ts b/public/app/plugins/datasource/loki/querySplitting.ts
index 069ed4e7b90..d0fd1678455 100644
--- a/public/app/plugins/datasource/loki/querySplitting.ts
+++ b/public/app/plugins/datasource/loki/querySplitting.ts
@@ -293,7 +293,10 @@ export function runSplitQuery(
   request: DataQueryRequest<LokiQuery>,
   options: QuerySplittingOptions = {}
 ) {
-  const queries = request.targets.filter((query) => !query.hide).filter((query) => query.expr);
+  const queries = request.targets
+    .filter((query) => !query.hide)
+    .filter((query) => query.expr)
+    .map((query) => datasource.applyTemplateVariables(query, request.scopedVars, request.filters));
   const [nonSplittingQueries, normalQueries] = partition(queries, (query) => !querySupportsSplitting(query));
   const [logQueries, metricQueries] = partition(normalQueries, (query) => isLogsQuery(query.expr));
 
diff --git a/public/app/plugins/datasource/loki/shardQuerySplitting.test.ts b/public/app/plugins/datasource/loki/shardQuerySplitting.test.ts
index 566eddeae81..04cb8c15055 100644
--- a/public/app/plugins/datasource/loki/shardQuerySplitting.test.ts
+++ b/public/app/plugins/datasource/loki/shardQuerySplitting.test.ts
@@ -53,11 +53,9 @@ describe('runShardSplitQuery()', () => {
     request = createRequest([{ expr: '$SELECTOR', refId: 'A', direction: LokiQueryDirection.Scan }]);
     datasource = createLokiDatasource();
     datasource.languageProvider.fetchLabelValues = jest.fn();
-    datasource.interpolateVariablesInQueries = jest.fn().mockImplementation((queries: LokiQuery[]) => {
-      return queries.map((query) => {
-        query.expr = query.expr.replace('$SELECTOR', '{a="b"}');
-        return query;
-      });
+    datasource.applyTemplateVariables = jest.fn().mockImplementation((query: LokiQuery) => {
+      query.expr = query.expr.replace('$SELECTOR', '{a="b"}');
+      return query;
     });
     jest.mocked(datasource.languageProvider.fetchLabelValues).mockResolvedValue(['1', '10', '2', '20', '3']);
     const { metricFrameA } = getMockFrames();
@@ -83,6 +81,25 @@ describe('runShardSplitQuery()', () => {
     });
   });
 
+  test('Interpolates queries before execution', async () => {
+    const request = createRequest([{ expr: 'count_over_time({a="b"}[$__auto])', refId: 'A', step: '$step' }]);
+    datasource = createLokiDatasource({
+      replace: (input = '') => {
+        return input.replace('$__auto', '5m').replace('$step', '5m');
+      },
+      getVariables: () => [],
+    });
+    jest.spyOn(datasource, 'runQuery').mockReturnValue(of({ data: [] }));
+    datasource.languageProvider.fetchLabelValues = jest.fn();
+    jest.mocked(datasource.languageProvider.fetchLabelValues).mockResolvedValue(['1', '10', '2', '20', '3']);
+    await expect(runShardSplitQuery(datasource, request)).toEmitValuesWith(() => {
+      expect(jest.mocked(datasource.runQuery).mock.calls[0][0].targets[0].expr).toBe(
+        'count_over_time({a="b", __stream_shard__=~"20|10"} | drop __stream_shard__[5m])'
+      );
+      expect(jest.mocked(datasource.runQuery).mock.calls[0][0].targets[0].step).toBe('5m');
+    });
+  });
+
   test('Users query splitting for querying over a day', async () => {
     await expect(runShardSplitQuery(datasource, request)).toEmitValuesWith(() => {
       // 5 shards, 3 groups + empty shard group, 4 requests
@@ -92,7 +109,7 @@ describe('runShardSplitQuery()', () => {
 
   test('Interpolates queries before running', async () => {
     await expect(runShardSplitQuery(datasource, request)).toEmitValuesWith(() => {
-      expect(datasource.interpolateVariablesInQueries).toHaveBeenCalledTimes(1);
+      expect(datasource.applyTemplateVariables).toHaveBeenCalledTimes(5);
 
       expect(datasource.runQuery).toHaveBeenCalledWith({
         intervalMs: expect.any(Number),
@@ -153,11 +170,9 @@ describe('runShardSplitQuery()', () => {
   });
 
   test('Sends the whole stream selector to fetch values', async () => {
-    datasource.interpolateVariablesInQueries = jest.fn().mockImplementation((queries: LokiQuery[]) => {
-      return queries.map((query) => {
-        query.expr = query.expr.replace('$SELECTOR', '{service_name="test", filter="true"}');
-        return query;
-      });
+    datasource.applyTemplateVariables = jest.fn().mockImplementation((query: LokiQuery) => {
+      query.expr = query.expr.replace('$SELECTOR', '{service_name="test", filter="true"}');
+      return query;
     });
 
     await expect(runShardSplitQuery(datasource, request)).toEmitValuesWith(() => {
diff --git a/public/app/plugins/datasource/loki/shardQuerySplitting.ts b/public/app/plugins/datasource/loki/shardQuerySplitting.ts
index 9f8dc397b8d..6a949ece553 100644
--- a/public/app/plugins/datasource/loki/shardQuerySplitting.ts
+++ b/public/app/plugins/datasource/loki/shardQuerySplitting.ts
@@ -46,10 +46,10 @@ import { LokiQuery } from './types';
  */
 
 export function runShardSplitQuery(datasource: LokiDatasource, request: DataQueryRequest<LokiQuery>) {
-  const queries = datasource
-    .interpolateVariablesInQueries(request.targets, request.scopedVars)
+  const queries = request.targets
     .filter((query) => query.expr)
-    .filter((query) => !query.hide);
+    .filter((query) => !query.hide)
+    .map((query) => datasource.applyTemplateVariables(query, request.scopedVars, request.filters));
 
   return splitQueriesByStreamShard(datasource, request, queries);
 }