diff --git a/library/CHANGELOG.md b/library/CHANGELOG.md
index 92f1ce498..3c6164303 100644
--- a/library/CHANGELOG.md
+++ b/library/CHANGELOG.md
@@ -6,6 +6,7 @@ All notable changes to the library will be documented in this file.
 
 - Add `nanoid` action to validate Nano IDs (pull request #789)
 - Add `undefinedable` and `undefinedableAsync` schema (issue #385)
+- Fix invalid output type for transformed optional object entries (issue #806)
 
 ## v0.39.0 (August 24, 2024)
 
diff --git a/library/src/schemas/looseObject/looseObject.test-d.ts b/library/src/schemas/looseObject/looseObject.test-d.ts
index 05284b2eb..adc1f72f6 100644
--- a/library/src/schemas/looseObject/looseObject.test-d.ts
+++ b/library/src/schemas/looseObject/looseObject.test-d.ts
@@ -1,5 +1,5 @@
 import { describe, expectTypeOf, test } from 'vitest';
-import type { ReadonlyAction } from '../../actions/index.ts';
+import type { ReadonlyAction, TransformAction } from '../../actions/index.ts';
 import type { SchemaWithPipe } from '../../methods/index.ts';
 import type { InferInput, InferIssue, InferOutput } from '../../types/index.ts';
 import type { NullishSchema } from '../nullish/index.ts';
@@ -48,6 +48,12 @@ describe('looseObject', () => {
         key4: ObjectSchema<{ key: NumberSchema<undefined> }, never>;
         key5: SchemaWithPipe<[StringSchema<undefined>, ReadonlyAction<string>]>;
         key6: UndefinedableSchema<StringSchema<undefined>, 'bar'>;
+        key7: SchemaWithPipe<
+          [
+            OptionalSchema<StringSchema<undefined>, never>,
+            TransformAction<undefined | string, string>,
+          ]
+        >;
       },
       undefined
     >;
@@ -61,6 +67,7 @@ describe('looseObject', () => {
           key4: { key: number };
           key5: string;
           key6: string | undefined;
+          key7?: string;
         } & { [key: string]: unknown }
       >();
     });
@@ -74,6 +81,7 @@ describe('looseObject', () => {
           key4: { key: number };
           readonly key5: string;
           key6: string;
+          key7: string;
         } & { [key: string]: unknown }
       >();
     });
diff --git a/library/src/schemas/looseObject/looseObjectAsync.test-d.ts b/library/src/schemas/looseObject/looseObjectAsync.test-d.ts
index 44b56bfa6..f16257b8e 100644
--- a/library/src/schemas/looseObject/looseObjectAsync.test-d.ts
+++ b/library/src/schemas/looseObject/looseObjectAsync.test-d.ts
@@ -1,5 +1,5 @@
 import { describe, expectTypeOf, test } from 'vitest';
-import type { ReadonlyAction } from '../../actions/index.ts';
+import type { ReadonlyAction, TransformAction } from '../../actions/index.ts';
 import type { SchemaWithPipe } from '../../methods/index.ts';
 import type { InferInput, InferIssue, InferOutput } from '../../types/index.ts';
 import type { NullishSchema } from '../nullish/index.ts';
@@ -53,6 +53,12 @@ describe('looseObjectAsync', () => {
         key4: ObjectSchema<{ key: NumberSchema<undefined> }, never>;
         key5: SchemaWithPipe<[StringSchema<undefined>, ReadonlyAction<string>]>;
         key6: UndefinedableSchema<StringSchema<undefined>, 'bar'>;
+        key7: SchemaWithPipe<
+          [
+            OptionalSchema<StringSchema<undefined>, never>,
+            TransformAction<undefined | string, string>,
+          ]
+        >;
       },
       undefined
     >;
@@ -66,6 +72,7 @@ describe('looseObjectAsync', () => {
           key4: { key: number };
           key5: string;
           key6: string | undefined;
+          key7?: string;
         } & { [key: string]: unknown }
       >();
     });
@@ -79,6 +86,7 @@ describe('looseObjectAsync', () => {
           key4: { key: number };
           readonly key5: string;
           key6: string;
+          key7: string;
         } & { [key: string]: unknown }
       >();
     });
diff --git a/library/src/schemas/object/object.test-d.ts b/library/src/schemas/object/object.test-d.ts
index 51e13c917..7592be303 100644
--- a/library/src/schemas/object/object.test-d.ts
+++ b/library/src/schemas/object/object.test-d.ts
@@ -1,5 +1,5 @@
 import { describe, expectTypeOf, test } from 'vitest';
-import type { ReadonlyAction } from '../../actions/index.ts';
+import type { ReadonlyAction, TransformAction } from '../../actions/index.ts';
 import type { SchemaWithPipe } from '../../methods/index.ts';
 import type { InferInput, InferIssue, InferOutput } from '../../types/index.ts';
 import type { NullishSchema } from '../nullish/index.ts';
@@ -47,6 +47,12 @@ describe('object', () => {
         key4: ObjectSchema<{ key: NumberSchema<undefined> }, never>;
         key5: SchemaWithPipe<[StringSchema<undefined>, ReadonlyAction<string>]>;
         key6: UndefinedableSchema<StringSchema<undefined>, 'bar'>;
+        key7: SchemaWithPipe<
+          [
+            OptionalSchema<StringSchema<undefined>, never>,
+            TransformAction<undefined | string, string>,
+          ]
+        >;
       },
       undefined
     >;
@@ -59,6 +65,7 @@ describe('object', () => {
         key4: { key: number };
         key5: string;
         key6: string | undefined;
+        key7?: string;
       }>();
     });
 
@@ -70,6 +77,7 @@ describe('object', () => {
         key4: { key: number };
         readonly key5: string;
         key6: string;
+        key7: string;
       }>();
     });
 
diff --git a/library/src/schemas/object/objectAsync.test-d.ts b/library/src/schemas/object/objectAsync.test-d.ts
index ea891e200..8439246d3 100644
--- a/library/src/schemas/object/objectAsync.test-d.ts
+++ b/library/src/schemas/object/objectAsync.test-d.ts
@@ -1,5 +1,5 @@
 import { describe, expectTypeOf, test } from 'vitest';
-import type { ReadonlyAction } from '../../actions/index.ts';
+import type { ReadonlyAction, TransformAction } from '../../actions/index.ts';
 import type { SchemaWithPipe } from '../../methods/index.ts';
 import type { InferInput, InferIssue, InferOutput } from '../../types/index.ts';
 import type { NullishSchema } from '../nullish/index.ts';
@@ -47,6 +47,12 @@ describe('objectAsync', () => {
         key4: ObjectSchemaAsync<{ key: NumberSchema<undefined> }, never>;
         key5: SchemaWithPipe<[StringSchema<undefined>, ReadonlyAction<string>]>;
         key6: UndefinedableSchema<StringSchema<undefined>, 'bar'>;
+        key7: SchemaWithPipe<
+          [
+            OptionalSchema<StringSchema<undefined>, never>,
+            TransformAction<undefined | string, string>,
+          ]
+        >;
       },
       undefined
     >;
@@ -59,6 +65,7 @@ describe('objectAsync', () => {
         key4: { key: number };
         key5: string;
         key6: string | undefined;
+        key7?: string;
       }>();
     });
 
@@ -70,6 +77,7 @@ describe('objectAsync', () => {
         key4: { key: number };
         readonly key5: string;
         key6: string;
+        key7: string;
       }>();
     });
 
diff --git a/library/src/schemas/objectWithRest/objectWithRest.test-d.ts b/library/src/schemas/objectWithRest/objectWithRest.test-d.ts
index 6464c4ee8..17dbbfbf0 100644
--- a/library/src/schemas/objectWithRest/objectWithRest.test-d.ts
+++ b/library/src/schemas/objectWithRest/objectWithRest.test-d.ts
@@ -1,5 +1,5 @@
 import { describe, expectTypeOf, test } from 'vitest';
-import type { ReadonlyAction } from '../../actions/index.ts';
+import type { ReadonlyAction, TransformAction } from '../../actions/index.ts';
 import type { SchemaWithPipe } from '../../methods/index.ts';
 import type { InferInput, InferIssue, InferOutput } from '../../types/index.ts';
 import type { BooleanIssue, BooleanSchema } from '../boolean/index.ts';
@@ -57,6 +57,12 @@ describe('objectWithRest', () => {
         key4: ObjectSchema<{ key: NumberSchema<undefined> }, never>;
         key5: SchemaWithPipe<[StringSchema<undefined>, ReadonlyAction<string>]>;
         key6: UndefinedableSchema<StringSchema<undefined>, 'bar'>;
+        key7: SchemaWithPipe<
+          [
+            OptionalSchema<StringSchema<undefined>, never>,
+            TransformAction<undefined | string, string>,
+          ]
+        >;
       },
       BooleanSchema<undefined>,
       undefined
@@ -71,6 +77,7 @@ describe('objectWithRest', () => {
           key4: { key: number };
           key5: string;
           key6: string | undefined;
+          key7?: string;
         } & { [key: string]: boolean }
       >();
     });
@@ -84,6 +91,7 @@ describe('objectWithRest', () => {
           key4: { key: number };
           readonly key5: string;
           key6: string;
+          key7: string;
         } & { [key: string]: boolean }
       >();
     });
diff --git a/library/src/schemas/objectWithRest/objectWithRestAsync.test-d.ts b/library/src/schemas/objectWithRest/objectWithRestAsync.test-d.ts
index fd75024a5..bb5d11195 100644
--- a/library/src/schemas/objectWithRest/objectWithRestAsync.test-d.ts
+++ b/library/src/schemas/objectWithRest/objectWithRestAsync.test-d.ts
@@ -1,5 +1,5 @@
 import { describe, expectTypeOf, test } from 'vitest';
-import type { ReadonlyAction } from '../../actions/index.ts';
+import type { ReadonlyAction, TransformAction } from '../../actions/index.ts';
 import type { SchemaWithPipe } from '../../methods/index.ts';
 import type { InferInput, InferIssue, InferOutput } from '../../types/index.ts';
 import type { BooleanIssue, BooleanSchema } from '../boolean/index.ts';
@@ -60,6 +60,12 @@ describe('objectWithRestAsync', () => {
         key4: ObjectSchema<{ key: NumberSchema<undefined> }, never>;
         key5: SchemaWithPipe<[StringSchema<undefined>, ReadonlyAction<string>]>;
         key6: UndefinedableSchema<StringSchema<undefined>, 'bar'>;
+        key7: SchemaWithPipe<
+          [
+            OptionalSchema<StringSchema<undefined>, never>,
+            TransformAction<undefined | string, string>,
+          ]
+        >;
       },
       BooleanSchema<undefined>,
       undefined
@@ -74,6 +80,7 @@ describe('objectWithRestAsync', () => {
           key4: { key: number };
           key5: string;
           key6: string | undefined;
+          key7?: string;
         } & { [key: string]: boolean }
       >();
     });
@@ -87,6 +94,7 @@ describe('objectWithRestAsync', () => {
           key4: { key: number };
           readonly key5: string;
           key6: string;
+          key7: string;
         } & { [key: string]: boolean }
       >();
     });
diff --git a/library/src/schemas/strictObject/strictObject.test-d.ts b/library/src/schemas/strictObject/strictObject.test-d.ts
index 174b2abfb..b8cbe80e7 100644
--- a/library/src/schemas/strictObject/strictObject.test-d.ts
+++ b/library/src/schemas/strictObject/strictObject.test-d.ts
@@ -1,5 +1,5 @@
 import { describe, expectTypeOf, test } from 'vitest';
-import type { ReadonlyAction } from '../../actions/index.ts';
+import type { ReadonlyAction, TransformAction } from '../../actions/index.ts';
 import type { SchemaWithPipe } from '../../methods/index.ts';
 import type { InferInput, InferIssue, InferOutput } from '../../types/index.ts';
 import type { NullishSchema } from '../nullish/index.ts';
@@ -48,6 +48,12 @@ describe('strictObject', () => {
         key4: ObjectSchema<{ key: NumberSchema<undefined> }, never>;
         key5: SchemaWithPipe<[StringSchema<undefined>, ReadonlyAction<string>]>;
         key6: UndefinedableSchema<StringSchema<undefined>, 'bar'>;
+        key7: SchemaWithPipe<
+          [
+            OptionalSchema<StringSchema<undefined>, never>,
+            TransformAction<undefined | string, string>,
+          ]
+        >;
       },
       undefined
     >;
@@ -60,6 +66,7 @@ describe('strictObject', () => {
         key4: { key: number };
         key5: string;
         key6: string | undefined;
+        key7?: string;
       }>();
     });
 
@@ -71,6 +78,7 @@ describe('strictObject', () => {
         key4: { key: number };
         readonly key5: string;
         key6: string;
+        key7: string;
       }>();
     });
 
diff --git a/library/src/schemas/strictObject/strictObjectAsync.test-d.ts b/library/src/schemas/strictObject/strictObjectAsync.test-d.ts
index 6a5ed5c8d..73e0b62a1 100644
--- a/library/src/schemas/strictObject/strictObjectAsync.test-d.ts
+++ b/library/src/schemas/strictObject/strictObjectAsync.test-d.ts
@@ -1,5 +1,5 @@
 import { describe, expectTypeOf, test } from 'vitest';
-import type { ReadonlyAction } from '../../actions/index.ts';
+import type { ReadonlyAction, TransformAction } from '../../actions/index.ts';
 import type { SchemaWithPipe } from '../../methods/index.ts';
 import type { InferInput, InferIssue, InferOutput } from '../../types/index.ts';
 import type { NullishSchema } from '../nullish/index.ts';
@@ -53,6 +53,12 @@ describe('strictObjectAsync', () => {
         key4: ObjectSchema<{ key: NumberSchema<undefined> }, never>;
         key5: SchemaWithPipe<[StringSchema<undefined>, ReadonlyAction<string>]>;
         key6: UndefinedableSchema<StringSchema<undefined>, 'bar'>;
+        key7: SchemaWithPipe<
+          [
+            OptionalSchema<StringSchema<undefined>, never>,
+            TransformAction<undefined | string, string>,
+          ]
+        >;
       },
       undefined
     >;
@@ -65,6 +71,7 @@ describe('strictObjectAsync', () => {
         key4: { key: number };
         key5: string;
         key6: string | undefined;
+        key7?: string;
       }>();
     });
 
@@ -76,6 +83,7 @@ describe('strictObjectAsync', () => {
         key4: { key: number };
         readonly key5: string;
         key6: string;
+        key7: string;
       }>();
     });
 
diff --git a/library/src/types/object.ts b/library/src/types/object.ts
index 17c66d123..de726fe0e 100644
--- a/library/src/types/object.ts
+++ b/library/src/types/object.ts
@@ -165,9 +165,11 @@ type OptionalInputKeys<TEntries extends ObjectEntries | ObjectEntriesAsync> = {
  */
 type OptionalOutputKeys<TEntries extends ObjectEntries | ObjectEntriesAsync> = {
   [TKey in keyof TEntries]: TEntries[TKey] extends QuestionMarkSchema
-    ? HasDefault<TEntries[TKey]> extends true
-      ? never
-      : TKey
+    ? undefined extends InferOutput<TEntries[TKey]>
+      ? HasDefault<TEntries[TKey]> extends false
+        ? TKey
+        : never
+      : never
     : never;
 }[keyof TEntries];