diff --git a/packages/create-nx-workspace/bin/create-nx-workspace.ts b/packages/create-nx-workspace/bin/create-nx-workspace.ts
index 2e315217d33b7..770daf66659fe 100644
--- a/packages/create-nx-workspace/bin/create-nx-workspace.ts
+++ b/packages/create-nx-workspace/bin/create-nx-workspace.ts
@@ -10,7 +10,7 @@ import { nxVersion } from '../src/utils/nx/nx-version';
 import { pointToTutorialAndCourse } from '../src/utils/preset/point-to-tutorial-and-course';
 
 import { yargsDecorator } from './decorator';
-import { getThirdPartyPreset } from '../src/utils/preset/get-third-party-preset';
+import { getPackageNameFromThirdPartyPreset } from '../src/utils/preset/get-third-party-preset';
 import {
   determineDefaultBase,
   determineNxCloud,
@@ -26,6 +26,7 @@ import {
 import { showNxWarning } from '../src/utils/nx/show-nx-warning';
 import { printNxCloudSuccessMessage } from '../src/utils/nx/nx-cloud';
 import { messages, recordStat } from '../src/utils/nx/ab-testing';
+import { mapErrorToBodyLines } from '../src/utils/error-utils';
 import { existsSync } from 'fs';
 
 interface BaseArguments extends CreateWorkspaceOptions {
@@ -256,29 +257,25 @@ async function normalizeArgsMiddleware(
   });
 
   try {
-    let thirdPartyPreset: string | null;
-
-    try {
-      thirdPartyPreset = await getThirdPartyPreset(argv.preset);
-    } catch (e) {
-      output.error({
-        title: `Could not find preset "${argv.preset}"`,
-      });
-      process.exit(1);
-    }
-
     argv.name = await determineFolder(argv);
-
-    if (thirdPartyPreset) {
-      Object.assign(argv, {
-        preset: thirdPartyPreset,
-        appName: '',
-        style: '',
-      });
-    } else {
+    if (isKnownPreset(argv.preset)) {
       argv.stack = await determineStack(argv);
       const presetOptions = await determinePresetOptions(argv);
       Object.assign(argv, presetOptions);
+    } else {
+      try {
+        getPackageNameFromThirdPartyPreset(argv.preset);
+      } catch (e) {
+        if (e instanceof Error) {
+          output.error({
+            title: `Could not find preset "${argv.preset}"`,
+            bodyLines: mapErrorToBodyLines(e),
+          });
+        } else {
+          console.error(e);
+        }
+        process.exit(1);
+      }
     }
 
     const packageManager = await determinePackageManager(argv);
diff --git a/packages/create-nx-workspace/src/create-workspace.ts b/packages/create-nx-workspace/src/create-workspace.ts
index 54e8f3e3c3f7d..dbb0bd9da3f56 100644
--- a/packages/create-nx-workspace/src/create-workspace.ts
+++ b/packages/create-nx-workspace/src/create-workspace.ts
@@ -6,7 +6,7 @@ import { createEmptyWorkspace } from './create-empty-workspace';
 import { createPreset } from './create-preset';
 import { setupCI } from './utils/ci/setup-ci';
 import { initializeGitRepo } from './utils/git/git';
-import { getThirdPartyPreset } from './utils/preset/get-third-party-preset';
+import { getPackageNameFromThirdPartyPreset } from './utils/preset/get-third-party-preset';
 import { mapErrorToBodyLines } from './utils/error-utils';
 
 export async function createWorkspace<T extends CreateWorkspaceOptions>(
@@ -40,9 +40,14 @@ export async function createWorkspace<T extends CreateWorkspaceOptions>(
   // If the preset is a third-party preset, we need to call createPreset to install it
   // For first-party presets, it will be created by createEmptyWorkspace instead.
   // In createEmptyWorkspace, it will call `nx new` -> `@nx/workspace newGenerator` -> `@nx/workspace generatePreset`.
-  const thirdPartyPreset = await getThirdPartyPreset(preset);
-  if (thirdPartyPreset) {
-    await createPreset(thirdPartyPreset, options, packageManager, directory);
+  const thirdPartyPackageName = getPackageNameFromThirdPartyPreset(preset);
+  if (thirdPartyPackageName) {
+    await createPreset(
+      thirdPartyPackageName,
+      options,
+      packageManager,
+      directory
+    );
   }
 
   let nxCloudInstallRes;
diff --git a/packages/create-nx-workspace/src/utils/preset/get-third-party-preset.spec.ts b/packages/create-nx-workspace/src/utils/preset/get-third-party-preset.spec.ts
new file mode 100644
index 0000000000000..3638a63e97d2e
--- /dev/null
+++ b/packages/create-nx-workspace/src/utils/preset/get-third-party-preset.spec.ts
@@ -0,0 +1,21 @@
+import { getPackageNameFromThirdPartyPreset } from './get-third-party-preset';
+
+describe('getPackageNameFromThirdPartyPreset', () => {
+  it('should throw an error if preset is invalid', () => {
+    expect(() => getPackageNameFromThirdPartyPreset('_random')).toThrow();
+  });
+
+  it('should return undefined if preset is known nx preset', () => {
+    expect(getPackageNameFromThirdPartyPreset('react')).toBeUndefined();
+    expect(getPackageNameFromThirdPartyPreset('angular')).toBeUndefined();
+  });
+
+  it('should return package name if it is valid package', () => {
+    expect(getPackageNameFromThirdPartyPreset('@nx-go/nx-go')).toEqual(
+      '@nx-go/nx-go'
+    );
+    expect(getPackageNameFromThirdPartyPreset('@nx-go/nx-go@19.0.0')).toEqual(
+      '@nx-go/nx-go'
+    );
+  });
+});
diff --git a/packages/create-nx-workspace/src/utils/preset/get-third-party-preset.ts b/packages/create-nx-workspace/src/utils/preset/get-third-party-preset.ts
index 4b5aa13a6b532..82def15d14c18 100644
--- a/packages/create-nx-workspace/src/utils/preset/get-third-party-preset.ts
+++ b/packages/create-nx-workspace/src/utils/preset/get-third-party-preset.ts
@@ -1,36 +1,31 @@
-import { output } from '../output';
 import { validateNpmPackage } from '../validate-npm-package';
 import { isKnownPreset } from './preset';
 
 /**
  * This function is used to check if a preset is a third party preset.
  * @param preset
- * @returns null if the preset is a known Nx preset or preset does not exist, the package name of preset otherwise.
+ * @returns
+ * - undefined if the preset is a known Nx preset or invalid.
+ * - packageName if the preset is a third party preset.
+ * - throws an error if the preset is invalid.
  */
-export async function getThirdPartyPreset(
+export function getPackageNameFromThirdPartyPreset(
   preset?: string
-): Promise<string | null> {
-  if (preset && !isKnownPreset(preset)) {
-    // extract the package name from the preset
-    const packageName = preset.match(/.+@/)
-      ? preset[0] + preset.substring(1).split('@')[0]
-      : preset;
-    const validateResult = validateNpmPackage(packageName);
-    if (validateResult.validForNewPackages) {
-      return Promise.resolve(packageName);
-    } else {
-      //! Error here
-      output.error({
-        title: 'Invalid preset npm package',
-        bodyLines: [
-          `There was an error with the preset npm package you provided:`,
-          '',
-          ...(validateResult.errors ?? []),
-        ],
-      });
-      throw new Error('Invalid preset npm package');
-    }
-  } else {
-    return Promise.resolve(null);
+): string | undefined {
+  if (!preset || isKnownPreset(preset)) {
+    return;
   }
+  // extract the package name from the preset
+  const packageName = preset.match(/.+@/)
+    ? preset[0] + preset.substring(1).split('@')[0]
+    : preset;
+
+  const validateResult = validateNpmPackage(packageName);
+  if (!validateResult.validForNewPackages) {
+    throw new Error(
+      `Invalid preset npm package ${packageName}. There was an error with the preset npm package you provided: ` +
+        (validateResult.errors ?? []).join('\n')
+    );
+  }
+  return packageName;
 }