diff --git a/.changeset/happy-boxes-melt.md b/.changeset/happy-boxes-melt.md
new file mode 100644
index 0000000000..c478e783d3
--- /dev/null
+++ b/.changeset/happy-boxes-melt.md
@@ -0,0 +1,6 @@
+---
+'@techdocs/cli': patch
+'@backstage/plugin-techdocs-node': patch
+---
+
+Fix the flag parsing for `legacyCopyReadmeMdToIndexMd` in `techdocs-cli generate` command, and decouple it's logic from the `techdocs-ref` flag.
diff --git a/packages/techdocs-cli/src/commands/generate/generate.ts b/packages/techdocs-cli/src/commands/generate/generate.ts
index 309b9c7969..1e4ed220d9 100644
--- a/packages/techdocs-cli/src/commands/generate/generate.ts
+++ b/packages/techdocs-cli/src/commands/generate/generate.ts
@@ -57,8 +57,8 @@ export default async function generate(opts: OptionValues) {
         runIn: opts.docker ? 'docker' : 'local',
         dockerImage,
         pullImage,
-        legacyCopyReadmeMdToIndexMd,
         mkdocs: {
+          legacyCopyReadmeMdToIndexMd,
           omitTechdocsCorePlugin,
         },
       },
diff --git a/plugins/techdocs-node/src/stages/generate/techdocs.ts b/plugins/techdocs-node/src/stages/generate/techdocs.ts
index 660b8e8cb5..e3debab526 100644
--- a/plugins/techdocs-node/src/stages/generate/techdocs.ts
+++ b/plugins/techdocs-node/src/stages/generate/techdocs.ts
@@ -111,10 +111,10 @@ export class TechdocsGenerator implements GeneratorBase {
         parsedLocationAnnotation,
         this.scmIntegrations,
       );
+    }
 
-      if (this.options.legacyCopyReadmeMdToIndexMd) {
-        await patchIndexPreBuild({ inputDir, logger: childLogger, docsDir });
-      }
+    if (this.options.legacyCopyReadmeMdToIndexMd) {
+      await patchIndexPreBuild({ inputDir, logger: childLogger, docsDir });
     }
 
     if (!this.options.omitTechdocsCoreMkdocsPlugin) {