diff --git a/app/services/base_services/set_attributes.rb b/app/services/base_services/set_attributes.rb
index f1564b606979..2f99ec17453d 100644
--- a/app/services/base_services/set_attributes.rb
+++ b/app/services/base_services/set_attributes.rb
@@ -69,14 +69,14 @@ def set_default_attributes(_params)
     def set_custom_values_to_validate(params)
       return model.deactivate_custom_field_validations! if contract_options[:skip_custom_field_validation]
 
-      custom_field_ids = custom_field_ids_from(params)
+      custom_field_ids = custom_field_ids_to_validate(params)
 
-      # Only update custom_values_to_validate when custom field params are provided.
+      # Only update custom_values_to_validate when the custom field params are provided.
       # Otherwise keep them intact, so other services can still set them.
-      return if custom_field_ids.empty?
+      return unless custom_field_ids.any?
 
-      # Validate only the custom values being updated via the params.
-      model.custom_values_to_validate = model.custom_values.filter do |cv|
+      # Validate the custom values updated via the params only.
+      model.custom_values_to_validate = model.custom_field_values.filter do |cv|
         custom_field_ids.include?(cv.custom_field_id)
       end
     end
@@ -98,6 +98,13 @@ def prepare_model(model)
       model
     end
 
+    def custom_field_ids_to_validate(params)
+      # Leave custom_field_ids_to_validate empty when the model is not persisted,
+      # allowing the default behaviour to set the id's to be validated in the
+      # model.custom_values_to_validate method.
+      model.persisted? ? custom_field_ids_from(params) : []
+    end
+
     def custom_field_ids_from(params)
       # 1. Retrieve custom fields set via the accessor `wp.custom_field_1 = 1`
       custom_field_ids = params.keys.filter_map { |k| k[/^custom_field_(\d+)$/, 1]&.to_i }
diff --git a/app/services/projects/set_attributes_service.rb b/app/services/projects/set_attributes_service.rb
index 938ec6b95369..f24600b7c2e1 100644
--- a/app/services/projects/set_attributes_service.rb
+++ b/app/services/projects/set_attributes_service.rb
@@ -30,7 +30,6 @@
 
 module Projects
   class SetAttributesService < ::BaseServices::SetAttributes
-
     private
 
     def set_attributes(params)
@@ -111,5 +110,15 @@ def faulty_code?(status_code)
     def first_not_set_code
       (Project.status_codes.keys - [model.status_code]).first
     end
+
+    def custom_field_ids_to_validate(params)
+      # In case of new records, validate custom fields that are enabled for all projects
+      # and also required.
+      if model.new_record?
+        model.available_custom_fields.for_all.required.pluck(:id)
+      else
+        custom_field_ids_from(params)
+      end
+    end
   end
 end
diff --git a/spec/requests/api/v3/projects/create_resource_spec.rb b/spec/requests/api/v3/projects/create_resource_spec.rb
index 0b8d30085923..aafa45c8fe30 100644
--- a/spec/requests/api/v3/projects/create_resource_spec.rb
+++ b/spec/requests/api/v3/projects/create_resource_spec.rb
@@ -302,6 +302,58 @@
 
         it_behaves_like "creates a project with a custom value", "Engineering"
       end
+
+      context "with another custom field present" do
+        shared_let(:other_custom_field) do
+          create(:text_project_custom_field,
+                 name: "Other CF")
+        end
+
+        context "when a value for the other cf is provided but the required one is missing (regression #70107)" do
+          let(:body) do
+            {
+              identifier: "new_project_identifier",
+              name: "Project name",
+              other_custom_field.attribute_name(:camel_case) => {
+                raw: "Other value"
+              }
+            }.to_json
+          end
+
+          it "responds with 422 and explains the custom field error" do
+            expect(last_response).to have_http_status(:unprocessable_entity)
+
+            expect(last_response.body)
+              .to be_json_eql("Department can't be blank.".to_json)
+                    .at_path("message")
+          end
+        end
+      end
+
+      context "with another custom field present that is required but not for_all" do
+        shared_let(:required_not_for_all_custom_field) do
+          create(:text_project_custom_field,
+                 name: "Not for all CF",
+                 is_required: true,
+                 is_for_all: false)
+        end
+
+        context "when a value for the required field is provided, but no value for the required not for_all custom_field" do
+          let(:body) do
+            {
+              identifier: "new_project_identifier",
+              name: "Project name",
+              shared_custom_field.attribute_name(:camel_case) => {
+                raw: "Engineering"
+              }
+            }.to_json
+          end
+
+          it "responds with 201 and does not validate the required not for_all custom_field" do
+            expect(last_response).to have_http_status(:created)
+          end
+        end
+      end
     end
 
     context "with a visible custom field" do