diff --git a/mmv1/products/compute/terraform.yaml b/mmv1/products/compute/terraform.yaml
index 9f48d0c89612..6866ebf15e62 100644
--- a/mmv1/products/compute/terraform.yaml
+++ b/mmv1/products/compute/terraform.yaml
@@ -1440,6 +1440,8 @@ overrides: !ruby/object:Overrides::ResourceOverrides
       zone: !ruby/object:Overrides::Terraform::PropertyOverride
         required: false
         default_from_api: true
+      subnetwork: !ruby/object:Overrides::Terraform::PropertyOverride
+        diff_suppress_func: 'compareOptionalSubnet'
   GlobalNetworkEndpoint: !ruby/object:Overrides::Terraform::ResourceOverride
     id_format: "{{project}}/{{global_network_endpoint_group}}/{{ip_address}}/{{fqdn}}/{{port}}"
     mutex: networkEndpoint/{{project}}/{{global_network_endpoint_group}}
diff --git a/mmv1/third_party/terraform/tests/resource_compute_network_endpoint_group_test.go b/mmv1/third_party/terraform/tests/resource_compute_network_endpoint_group_test.go
new file mode 100644
index 000000000000..6e1510bcdf6d
--- /dev/null
+++ b/mmv1/third_party/terraform/tests/resource_compute_network_endpoint_group_test.go
@@ -0,0 +1,48 @@
+package google
+
+import (
+	"testing"
+
+	"github.com/hashicorp/terraform-plugin-sdk/v2/helper/resource"
+)
+
+func TestAccComputeNetworkEndpointGroup_networkEndpointGroup(t *testing.T) {
+	t.Parallel()
+
+	context := map[string]interface{}{
+		"random_suffix": randString(t, 10),
+	}
+
+	vcrTest(t, resource.TestCase{
+		PreCheck:     func() { testAccPreCheck(t) },
+		Providers:    testAccProviders,
+		CheckDestroy: testAccCheckComputeNetworkEndpointGroupDestroyProducer(t),
+		Steps: []resource.TestStep{
+			{
+				Config: testAccComputeNetworkEndpointGroup_networkEndpointGroup(context),
+			},
+			{
+				ResourceName:            "google_compute_network_endpoint_group.neg",
+				ImportState:             true,
+				ImportStateVerify:       true,
+				ImportStateVerifyIgnore: []string{"network", "subnetwork", "zone"},
+			},
+		},
+	})
+}
+
+func testAccComputeNetworkEndpointGroup_networkEndpointGroup(context map[string]interface{}) string {
+	return Nprintf(`
+resource "google_compute_network_endpoint_group" "neg" {
+  name         = "tf-test-my-lb-neg%{random_suffix}"
+  network      = google_compute_network.default.id
+  default_port = "90"
+  zone         = "us-central1-a"
+}
+
+resource "google_compute_network" "default" {
+  name                    = "tf-test-neg-network%{random_suffix}"
+  auto_create_subnetworks = true
+}
+`, context)
+}
diff --git a/mmv1/third_party/terraform/utils/common_diff_suppress.go.erb b/mmv1/third_party/terraform/utils/common_diff_suppress.go.erb
index b5cb1c3e2c35..a40fdb1041d3 100644
--- a/mmv1/third_party/terraform/utils/common_diff_suppress.go.erb
+++ b/mmv1/third_party/terraform/utils/common_diff_suppress.go.erb
@@ -200,3 +200,13 @@ func alwaysDiffSuppress(_, _, _ string, _ *schema.ResourceData) bool {
 	return true
 }
 <% end -%>
+
+// Use this method when subnet is optioanl and auto_create_subnetworks = true
+// API sometimes choose a subnet so the diff needs to be ignored
+func compareOptionalSubnet(_, old, new string, _ *schema.ResourceData) bool {
+	if isEmptyValue(reflect.ValueOf(new)) {
+		return true
+	}
+	// otherwise compare as self links
+	return compareSelfLinkOrResourceName("", old, new, nil)
+}