diff --git a/app/models/project.rb b/app/models/project.rb
index a66ed6736ca..5439f94c4a9 100644
--- a/app/models/project.rb
+++ b/app/models/project.rb
@@ -73,7 +73,7 @@ class Project < ActiveRecord::Base
   delegate :no_import?, to: :import_state, allow_nil: true
 
   default_value_for :archived, false
-  default_value_for :visibility_level, gitlab_config_features.visibility_level
+  default_value_for(:visibility_level) { Gitlab::CurrentSettings.default_project_visibility }
   default_value_for :resolve_outdated_diff_discussions, false
   default_value_for :container_registry_enabled, gitlab_config_features.container_registry
   default_value_for(:repository_storage) { Gitlab::CurrentSettings.pick_repository_storage }
diff --git a/changelogs/unreleased/45779-fix-default-visibility-level-for-projects.yml b/changelogs/unreleased/45779-fix-default-visibility-level-for-projects.yml
new file mode 100644
index 00000000000..b4cba5041d1
--- /dev/null
+++ b/changelogs/unreleased/45779-fix-default-visibility-level-for-projects.yml
@@ -0,0 +1,5 @@
+---
+title: Fix default visibility_level for new projects
+merge_request: 24120
+author: Fabian Schneider @fabsrc
+type: fixed
diff --git a/spec/models/project_spec.rb b/spec/models/project_spec.rb
index 3044150bca8..ffbf0960c95 100644
--- a/spec/models/project_spec.rb
+++ b/spec/models/project_spec.rb
@@ -1413,6 +1413,24 @@ describe Project do
     end
   end
 
+  describe '#visibility_level' do
+    let(:project) { build(:project) }
+
+    subject { project.visibility_level }
+
+    context 'by default' do
+      it { is_expected.to eq(Gitlab::VisibilityLevel::PRIVATE) }
+    end
+
+    context 'when set to INTERNAL in application settings' do
+      before do
+        stub_application_setting(default_project_visibility: Gitlab::VisibilityLevel::INTERNAL)
+      end
+
+      it { is_expected.to eq(Gitlab::VisibilityLevel::INTERNAL) }
+    end
+  end
+
   describe '#visibility_level_allowed?' do
     let(:project) { create(:project, :internal) }