diff --git a/.changeset/angry-ties-kiss.md b/.changeset/angry-ties-kiss.md
new file mode 100644
index 000000000..52018c225
--- /dev/null
+++ b/.changeset/angry-ties-kiss.md
@@ -0,0 +1,5 @@
+---
+'@graphprotocol/graph-cli': patch
+---
+
+Fix empty source name for substreams subgraphs #1868
diff --git a/packages/cli/src/commands/init.ts b/packages/cli/src/commands/init.ts
index f1f45bc67..4c35dfd8c 100644
--- a/packages/cli/src/commands/init.ts
+++ b/packages/cli/src/commands/init.ts
@@ -32,6 +32,7 @@ const protocolChoices = Array.from(Protocol.availableProtocols().keys());
 const initDebugger = debugFactory('graph-cli:commands:init');
 
 const DEFAULT_EXAMPLE_SUBGRAPH = 'ethereum-gravatar';
+const DEFAULT_CONTRACT_NAME = 'Contract';
 
 export default class InitCommand extends Command {
   static description = 'Creates a new subgraph with basic scaffolding.';
@@ -61,7 +62,7 @@ export default class InitCommand extends Command {
       description: 'Creates a scaffold based on an example subgraph.',
       // TODO: using a default sets the value and therefore requires not to have --from-contract
       // default: 'Contract',
-      exclusive: ['from-contract'],
+      exclusive: ['from-contract', 'spkg'],
     }),
 
     'contract-name': Flags.string({
@@ -103,7 +104,6 @@ export default class InitCommand extends Command {
       summary: 'Network the contract is deployed to.',
       description:
         'Refer to https://github.com/graphprotocol/networks-registry/ for supported networks',
-      dependsOn: ['from-contract'],
     }),
 
     ipfs: Flags.string({
@@ -143,17 +143,14 @@ export default class InitCommand extends Command {
         'The --skip-git flag will be removed in the next major version. By default we will stop initializing a Git repository.',
       );
     }
+    if ((!fromContract || !spkgPath) && !network && !fromExample) {
+      this.error('--network is required when using --from-contract or --spkg');
+    }
 
     const { node } = chooseNodeUrl({
       node: nodeFlag,
     });
 
-    if (fromContract && fromExample) {
-      this.error('Only one of "--from-example" and "--from-contract" can be used at a time.', {
-        exit: 1,
-      });
-    }
-
     // Detect git
     const git = system.which('git');
     if (!git) {
@@ -200,7 +197,7 @@ export default class InitCommand extends Command {
 
     // If all parameters are provided from the command-line,
     // go straight to creating the subgraph from an existing contract
-    if (fromContract && protocol && subgraphName && directory && network && node) {
+    if ((fromContract || spkgPath) && protocol && subgraphName && directory && network && node) {
       const registry = await loadRegistry();
       const contractService = new ContractService(registry);
 
@@ -225,7 +222,7 @@ export default class InitCommand extends Command {
           }
         } else {
           try {
-            abi = await contractService.getABI(ABI, network, fromContract);
+            abi = await contractService.getABI(ABI, network, fromContract!);
           } catch (e) {
             this.exit(1);
           }
@@ -237,11 +234,11 @@ export default class InitCommand extends Command {
           protocolInstance,
           abi,
           directory,
-          source: fromContract,
+          source: fromContract!,
           indexEvents,
           network,
           subgraphName,
-          contractName,
+          contractName: contractName || DEFAULT_CONTRACT_NAME,
           node,
           startBlock,
           spkgPath,
@@ -303,7 +300,7 @@ export default class InitCommand extends Command {
           network: answers.network,
           source: answers.source,
           indexEvents: answers.indexEvents,
-          contractName: answers.contractName,
+          contractName: answers.contractName || DEFAULT_CONTRACT_NAME,
           node,
           startBlock: answers.startBlock,
           spkgPath: answers.spkgPath,
diff --git a/packages/cli/src/scaffold/index.ts b/packages/cli/src/scaffold/index.ts
index 1d570b514..66a14cee0 100644
--- a/packages/cli/src/scaffold/index.ts
+++ b/packages/cli/src/scaffold/index.ts
@@ -118,6 +118,7 @@ export default class Scaffold {
 
   async generateManifest() {
     const protocolManifest = this.protocol.getManifestScaffold();
+    const name = this.contractName || getSubgraphBasename(String(this.subgraphName));
 
     return await prettier.format(
       `
@@ -128,7 +129,7 @@ schema:
   file: ./schema.graphql
 dataSources:
   - kind: ${this.protocol.name}
-    name: ${this.contractName}
+    name: ${name}
     network: ${this.network}
     source: ${protocolManifest.source({ ...this, spkgPath: './substreams.spkg', spkgModule: 'graph_out' })}
     mapping: ${protocolManifest.mapping(this)}
diff --git a/packages/cli/tests/cli/__snapshots__/init.test.ts.snap b/packages/cli/tests/cli/__snapshots__/init.test.ts.snap
index 17fbfbbc3..a9fb74ba3 100644
--- a/packages/cli/tests/cli/__snapshots__/init.test.ts.snap
+++ b/packages/cli/tests/cli/__snapshots__/init.test.ts.snap
@@ -285,3 +285,35 @@ Next steps:
 Make sure to visit the documentation on https://thegraph.com/docs/ for further information.
 "
 `;
+
+exports[`Init > Substreams > From package 1`] = `
+" ›   Warning: The --skip-git flag will be removed in the next major version. By
+ ›    default we will stop initializing a Git repository.
+- Create subgraph scaffold
+  Generate subgraph
+- Create subgraph scaffold
+  Write subgraph to directory
+- Create subgraph scaffold
+✔ Create subgraph scaffold
+- Install dependencies with yarn
+✔ Install dependencies with yarn
+"
+`;
+
+exports[`Init > Substreams > From package 2`] = `0`;
+
+exports[`Init > Substreams > From package 3`] = `
+"
+Subgraph user/subgraph-from-substreams created in from-package
+
+Next steps:
+
+  1. Run \`graph auth\` to authenticate with your deploy key.
+
+  2. Type \`cd from-package\` to enter the subgraph.
+
+  3. Run \`yarn deploy\` to deploy the subgraph.
+
+Make sure to visit the documentation on https://thegraph.com/docs/ for further information.
+"
+`;
diff --git a/packages/cli/tests/cli/init.test.ts b/packages/cli/tests/cli/init.test.ts
index efcacb183..874659a24 100644
--- a/packages/cli/tests/cli/init.test.ts
+++ b/packages/cli/tests/cli/init.test.ts
@@ -210,6 +210,33 @@ describe.sequential(
         },
       );
     });
+
+    describe('Substreams', () => {
+      const substreamsBaseDir = path.join(baseDir, 'substreams');
+
+      cliTest(
+        'From package',
+        [
+          'init',
+          '--skip-git',
+          '--protocol',
+          'substreams',
+          '--spkg',
+          path.join(substreamsBaseDir, 'substreams.spkg'),
+          '--network',
+          'mainnet',
+          'user/subgraph-from-substreams',
+          path.join(substreamsBaseDir, 'from-package'),
+        ],
+        path.join('init', 'substreams', 'from-package'),
+        {
+          exitCode: 0,
+          timeout: 100_000,
+          cwd: substreamsBaseDir,
+          deleteDir: true,
+        },
+      );
+    });
   },
   {
     timeout: 60_000,
diff --git a/packages/cli/tests/cli/init/substreams/substreams.spkg b/packages/cli/tests/cli/init/substreams/substreams.spkg
new file mode 100644
index 000000000..0884a0c13
--- /dev/null
+++ b/packages/cli/tests/cli/init/substreams/substreams.spkg
@@ -0,0 +1 @@
+test file, nothing to see here