diff --git a/flang/include/flang/Evaluate/type.h b/flang/include/flang/Evaluate/type.h
--- a/flang/include/flang/Evaluate/type.h
+++ b/flang/include/flang/Evaluate/type.h
@@ -91,8 +91,11 @@
     CHECK(IsValidKindOfIntrinsicType(category_, kind_));
   }
   DynamicType(int charKind, const semantics::ParamValue &len);
+  // When a known length is presented, resolve it to its effective
+  // length of zero if it is negative.
   constexpr DynamicType(int k, std::int64_t len)
-      : category_{TypeCategory::Character}, kind_{k}, knownLength_{len} {
+      : category_{TypeCategory::Character}, kind_{k}, knownLength_{
+                                                          len >= 0 ? len : 0} {
     CHECK(IsValidKindOfIntrinsicType(category_, kind_));
   }
   explicit constexpr DynamicType(
diff --git a/flang/lib/Evaluate/type.cpp b/flang/lib/Evaluate/type.cpp
--- a/flang/lib/Evaluate/type.cpp
+++ b/flang/lib/Evaluate/type.cpp
@@ -96,7 +96,7 @@
     : category_{TypeCategory::Character}, kind_{k} {
   CHECK(IsValidKindOfIntrinsicType(category_, kind_));
   if (auto n{ToInt64(pv.GetExplicit())}) {
-    knownLength_ = *n;
+    knownLength_ = *n > 0 ? *n : 0;
   } else {
     charLengthParamValue_ = &pv;
   }
diff --git a/flang/test/Semantics/separate-mp02.f90 b/flang/test/Semantics/separate-mp02.f90
--- a/flang/test/Semantics/separate-mp02.f90
+++ b/flang/test/Semantics/separate-mp02.f90
@@ -305,9 +305,32 @@
     end subroutine
   end interface
 end module
+
 submodule(m8) sm8
  contains
   !Ensure no spurious error about mismatching attributes
   module procedure s1
   end procedure
 end submodule
+
+module m9
+  interface
+    module subroutine sub1(s)
+      character(len=0) s
+    end subroutine
+    module subroutine sub2(s)
+      character(len=0) s
+    end subroutine
+  end interface
+end module
+
+submodule(m9) sm1
+ contains
+  module subroutine sub1(s)
+    character(len=-1) s ! ok
+  end subroutine
+  module subroutine sub2(s)
+    !ERROR: Dummy argument 's' has type CHARACTER(KIND=1,LEN=1_8); the corresponding argument in the interface body has type CHARACTER(KIND=1,LEN=0_8)
+    character(len=1) s
+  end subroutine
+end submodule