diff --git a/changelogs/fragments/include_vars_error_hang_fix.yaml b/changelogs/fragments/include_vars_error_hang_fix.yaml
new file mode 100644
index 00000000000..ec129495f60
--- /dev/null
+++ b/changelogs/fragments/include_vars_error_hang_fix.yaml
@@ -0,0 +1,2 @@
+bugfixes:
+- include_vars - Call DataLoader.load with the correct signature to prevent hang on error processing (https://github.com/ansible/ansible/pull/38194)
diff --git a/lib/ansible/plugins/action/include_vars.py b/lib/ansible/plugins/action/include_vars.py
index 7ef24e9b3a6..8897f87af11 100644
--- a/lib/ansible/plugins/action/include_vars.py
+++ b/lib/ansible/plugins/action/include_vars.py
@@ -236,7 +236,7 @@ class ActionModule(ActionBase):
             data = to_text(b_data, errors='surrogate_or_strict')
 
             self.show_content = show_content
-            data = self._loader.load(data, show_content)
+            data = self._loader.load(data, file_name=filename, show_content=show_content)
             if not data:
                 data = dict()
             if not isinstance(data, dict):