diff --git a/.changes/unreleased/BUG FIXES-20231027-092614.yaml b/.changes/unreleased/BUG FIXES-20231027-092614.yaml
new file mode 100644
index 00000000..42020253
--- /dev/null
+++ b/.changes/unreleased/BUG FIXES-20231027-092614.yaml	
@@ -0,0 +1,5 @@
+kind: BUG FIXES
+body: Fixed malformed stdout when wrapper is enabled
+time: 2023-10-27T09:26:14.675402-04:00
+custom:
+  Issue: "367"
diff --git a/.changes/unreleased/NOTES-20231027-134331.yaml b/.changes/unreleased/NOTES-20231027-134331.yaml
new file mode 100644
index 00000000..6833002c
--- /dev/null
+++ b/.changes/unreleased/NOTES-20231027-134331.yaml
@@ -0,0 +1,10 @@
+kind: NOTES
+body: The wrapper around the installed Terraform binary has been fixed to return the
+  exact STDOUT and STDERR from Terraform when executing commands. Previous versions
+  of setup-terraform may have required workarounds to process the STDOUT in bash,
+  such as filtering out the first line or selectively parsing STDOUT with jq. These
+  workarounds may need to be adjusted with `v3.0.0`, which will now return just the
+  STDOUT/STDERR from Terraform with no errant characters/statements.
+time: 2023-10-27T13:43:31.430759-04:00
+custom:
+  Issue: "367"
diff --git a/.github/workflows/data/local/main.tf b/.github/workflows/data/local/main.tf
index 77ea07a9..81ea3447 100644
--- a/.github/workflows/data/local/main.tf
+++ b/.github/workflows/data/local/main.tf
@@ -1,5 +1,5 @@
-resource "null_resource" "null" {
-  triggers = {
-    value = timestamp()
-  }
+resource "random_pet" "pet" {}
+
+output "pet" {
+  value = random_pet.pet.id
 }
diff --git a/.github/workflows/setup-terraform.yml b/.github/workflows/setup-terraform.yml
index 4dc826e8..ce77aac3 100644
--- a/.github/workflows/setup-terraform.yml
+++ b/.github/workflows/setup-terraform.yml
@@ -1,4 +1,4 @@
-name: 'Setup Terraform'
+name: 'setup-terraform tests'
 
 on:
   push:
@@ -303,3 +303,70 @@ jobs:
     - name: Terraform Plan
       id: plan
       run: terraform plan
+
+
+  terraform-stdout-wrapper:
+    name: 'Terraform STDOUT'
+    runs-on: ${{ matrix.os }}
+    strategy:
+      matrix:
+        os: [ubuntu-latest, windows-latest, macos-latest]
+    defaults:
+      run:
+        shell: bash
+        working-directory: ./.github/workflows/data/local
+    steps:
+    - name: Checkout
+      uses: actions/checkout@8ade135a41bc03ea155e62e844d188df1ea18608 # v4.1.0
+
+    - name: Setup Terraform
+      uses: ./
+      with:
+        terraform_wrapper: true
+
+    - name: Terraform Init
+      run: terraform init
+
+    - name: Terraform Format
+      run: terraform fmt -check
+
+    - name: Terraform Apply
+      id: apply
+      run: terraform apply -auto-approve
+
+    - name: Terraform Output to JQ
+      id: output
+      run: terraform output -json | jq '.pet.value'
+
+  terraform-stdout-no-wrapper:
+    name: 'Terraform STDOUT No Wrapper'
+    runs-on: ${{ matrix.os }}
+    strategy:
+      matrix:
+        os: [ubuntu-latest, windows-latest, macos-latest]
+    defaults:
+      run:
+        shell: bash
+        working-directory: ./.github/workflows/data/local
+    steps:
+    - name: Checkout
+      uses: actions/checkout@8ade135a41bc03ea155e62e844d188df1ea18608 # v4.1.0
+
+    - name: Setup Terraform
+      uses: ./
+      with:
+        terraform_wrapper: false
+
+    - name: Terraform Init
+      run: terraform init
+
+    - name: Terraform Format
+      run: terraform fmt -check
+
+    - name: Terraform Apply
+      id: apply
+      run: terraform apply -auto-approve
+
+    - name: Terraform Output to JQ
+      id: output
+      run: terraform output -json | jq '.pet.value'
diff --git a/dist/index1.js b/dist/index1.js
index 42444df7..56af6568 100755
--- a/dist/index1.js
+++ b/dist/index1.js
@@ -27221,13 +27221,14 @@ async function checkTerraform () {
   const args = process.argv.slice(2);
   const options = {
     listeners,
-    ignoreReturnCode: true
+    ignoreReturnCode: true,
+    silent: true, // avoid printing command in stdout: https://github.com/actions/toolkit/issues/649
   };
   const exitCode = await exec(pathToCLI, args, options);
-  core.debug(`Terraform exited with code ${exitCode}.`);
-  core.debug(`stdout: ${stdout.contents}`);
-  core.debug(`stderr: ${stderr.contents}`);
-  core.debug(`exitcode: ${exitCode}`);
+
+  // Pass-through stdout/err as `exec` won't due to `silent: true` option
+  process.stdout.write(stdout.contents);
+  process.stderr.write(stderr.contents);
 
   // Set outputs, result, exitcode, and stderr
   core.setOutput('stdout', stdout.contents);
diff --git a/wrapper/terraform.js b/wrapper/terraform.js
index eddcb35f..a64a4c22 100755
--- a/wrapper/terraform.js
+++ b/wrapper/terraform.js
@@ -33,13 +33,14 @@ async function checkTerraform () {
   const args = process.argv.slice(2);
   const options = {
     listeners,
-    ignoreReturnCode: true
+    ignoreReturnCode: true,
+    silent: true, // avoid printing command in stdout: https://github.com/actions/toolkit/issues/649
   };
   const exitCode = await exec(pathToCLI, args, options);
-  core.debug(`Terraform exited with code ${exitCode}.`);
-  core.debug(`stdout: ${stdout.contents}`);
-  core.debug(`stderr: ${stderr.contents}`);
-  core.debug(`exitcode: ${exitCode}`);
+
+  // Pass-through stdout/err as `exec` won't due to `silent: true` option
+  process.stdout.write(stdout.contents);
+  process.stderr.write(stderr.contents);
 
   // Set outputs, result, exitcode, and stderr
   core.setOutput('stdout', stdout.contents);