diff --git a/CHANGELOG.md b/CHANGELOG.md
index d06518f036e..105f7ec6889 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -57,6 +57,10 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 * [#7093](https://github.com/osmosis-labs/osmosis/pull/7093),[#7100](https://github.com/osmosis-labs/osmosis/pull/7100),[#7172](https://github.com/osmosis-labs/osmosis/pull/7172) Lower CPU overheads of the Osmosis epoch.
 * [#7203](https://github.com/osmosis-labs/osmosis/pull/7203) Make a maximum number of pools of 100 billion.
 
+### Bug Fixes
+
+* [#7233](https://github.com/osmosis-labs/osmosis/pull/7233) fix: config overwrite ignores app.toml values 
+
 ## v21.1.5
 
 * [#7210](https://github.com/osmosis-labs/osmosis/pull/7210) Arb filter for new authz exec swap.
diff --git a/cmd/osmosisd/cmd/root.go b/cmd/osmosisd/cmd/root.go
index 4bc7b1be47e..35490dbc08d 100644
--- a/cmd/osmosisd/cmd/root.go
+++ b/cmd/osmosisd/cmd/root.go
@@ -16,6 +16,7 @@ import (
 
 	rosettaCmd "cosmossdk.io/tools/rosetta/cmd"
 	"github.com/prometheus/client_golang/prometheus"
+	"github.com/spf13/viper"
 
 	cometbftdb "github.com/cometbft/cometbft-db"
 
@@ -92,11 +93,17 @@ type DenomUnitMap struct {
 	Exponent uint64 `json:"exponent"`
 }
 
+const (
+	consensusConfigName     = "consensus"
+	timeoutCommitConfigName = "timeout_commit"
+)
+
 var (
 	//go:embed "osmosis-1-assetlist.json" "osmo-test-5-assetlist.json"
-	assetFS   embed.FS
-	mainnetId = "osmosis-1"
-	testnetId = "osmo-test-5"
+	assetFS           embed.FS
+	mainnetId         = "osmosis-1"
+	testnetId         = "osmo-test-5"
+	fiveSecondsString = (5 * time.Second).String()
 )
 
 func loadAssetList(initClientCtx client.Context, cmd *cobra.Command, basedenomToIBC, IBCtoBasedenom bool) (map[string]DenomUnitMap, map[string]string) {
@@ -402,7 +409,7 @@ func NewRootCmd() (*cobra.Command, params.EncodingConfig) {
 }
 
 // overwrites config.toml values if it exists, otherwise it writes the default config.toml
-func overwriteConfigTomlValues(serverCtx *server.Context) (*tmcfg.Config, error) {
+func overwriteConfigTomlValues(serverCtx *server.Context) error {
 	// Get paths to config.toml and config parent directory
 	rootDir := serverCtx.Viper.GetString(tmcli.HomeFlag)
 
@@ -416,7 +423,7 @@ func overwriteConfigTomlValues(serverCtx *server.Context) (*tmcfg.Config, error)
 	if err != nil {
 		// something besides a does not exist error
 		if !os.IsNotExist(err) {
-			return nil, fmt.Errorf("failed to read in %s: %w", configFilePath, err)
+			return fmt.Errorf("failed to read in %s: %w", configFilePath, err)
 		}
 
 		// It does not exist, so we update the default config.toml to update
@@ -426,22 +433,32 @@ func overwriteConfigTomlValues(serverCtx *server.Context) (*tmcfg.Config, error)
 	} else {
 		// config.toml exists
 
-		serverCtx.Viper.SetConfigType("toml")
-		serverCtx.Viper.SetConfigName("config")
-		serverCtx.Viper.AddConfigPath(configParentDirPath)
+		// Create a copy since the original viper from serverCtx
+		// contains app.toml config values that would get overwritten
+		// by ReadInConfig below.
+		viperCopy := viper.New()
+
+		viperCopy.SetConfigType("toml")
+		viperCopy.SetConfigName("config")
+		viperCopy.AddConfigPath(configParentDirPath)
 
 		// We read it in and modify the consensus timeout commit
 		// and write it back.
-		if err := serverCtx.Viper.ReadInConfig(); err != nil {
-			return nil, fmt.Errorf("failed to read in %s: %w", configFilePath, err)
+		if err := viperCopy.ReadInConfig(); err != nil {
+			return fmt.Errorf("failed to read in %s: %w", configFilePath, err)
+		}
+
+		consensusValues := viperCopy.GetStringMapString(consensusConfigName)
+		timeoutCommitValue, ok := consensusValues[timeoutCommitConfigName]
+		if !ok {
+			return fmt.Errorf("failed to get %s.%s from %s: %w", consensusConfigName, timeoutCommitValue, configFilePath, err)
 		}
 
 		// The original default is 5s and is set in Cosmos SDK.
 		// We lower it to 4s for faster block times.
-		if serverCtx.Config.Consensus.TimeoutCommit == 5*time.Second {
+		if timeoutCommitValue == fiveSecondsString {
 			serverCtx.Config.Consensus.TimeoutCommit = 4 * time.Second
 		}
-		tmcConfig = serverCtx.Config
 
 		defer func() {
 			if err := recover(); err != nil {
@@ -452,7 +469,7 @@ func overwriteConfigTomlValues(serverCtx *server.Context) (*tmcfg.Config, error)
 		// this may panic for permissions issues. So we catch the panic.
 		tmcfg.WriteConfigFile(configFilePath, serverCtx.Config)
 	}
-	return tmcConfig, nil
+	return nil
 }
 
 func getHomeEnvironment() string {
@@ -635,7 +652,7 @@ func initRootCmd(rootCmd *cobra.Command, encodingConfig params.EncodingConfig) {
 				serverCtx := server.GetServerContextFromCmd(cmd)
 
 				// overwrite config.toml values
-				_, err := overwriteConfigTomlValues(serverCtx)
+				err := overwriteConfigTomlValues(serverCtx)
 				if err != nil {
 					return err
 				}