diff --git a/packages/bruno-app/src/providers/ReduxStore/slices/collections/index.js b/packages/bruno-app/src/providers/ReduxStore/slices/collections/index.js
index 24655f4f0..68658f6ee 100644
--- a/packages/bruno-app/src/providers/ReduxStore/slices/collections/index.js
+++ b/packages/bruno-app/src/providers/ReduxStore/slices/collections/index.js
@@ -217,6 +217,19 @@ export const collectionsSlice = createSlice({
 
             if (variable) {
               variable.value = value;
+            } else {
+              // __name__ is a private variable used to store the name of the environment
+              // this is not a user defined variable and hence should not be updated
+              if (key !== '__name__') {
+                activeEnvironment.variables.push({
+                  name: key,
+                  value,
+                  secret: false,
+                  enabled: true,
+                  type: 'text',
+                  uid: uuid()
+                });
+              }
             }
           });
         }
diff --git a/packages/bruno-js/src/bru.js b/packages/bruno-js/src/bru.js
index 70139985f..ffab6ec1b 100644
--- a/packages/bruno-js/src/bru.js
+++ b/packages/bruno-js/src/bru.js
@@ -48,11 +48,6 @@ class Bru {
       throw new Error('Creating a env variable without specifying a name is not allowed.');
     }
 
-    // gracefully ignore if key is not present in environment
-    if (!this.envVariables.hasOwnProperty(key)) {
-      return;
-    }
-
     this.envVariables[key] = value;
   }