diff --git a/app/services/projects/create_service.rb b/app/services/projects/create_service.rb
index 9bc8bb428fb05ed8d0ab53f561bd5058c6f3d7ff..6381ee67ce750cb6e8756ea1ade24f48272f3167 100644
--- a/app/services/projects/create_service.rb
+++ b/app/services/projects/create_service.rb
@@ -26,7 +26,7 @@ def execute
         return ::Projects::CreateFromTemplateService.new(current_user, params).execute
       end
 
-      @project = Project.new(params)
+      @project = Project.new(params.merge(creator: current_user))
 
       validate_import_source_enabled!
 
@@ -45,20 +45,14 @@ def execute
       set_project_name_from_path
 
       # get namespace id
-      namespace_id = params[:namespace_id]
-
-      if namespace_id
-        # Find matching namespace and check if it allowed
-        # for current user if namespace_id passed.
-        unless current_user.can?(:create_projects, parent_namespace)
-          @project.namespace_id = nil
-          deny_namespace
-          return @project
-        end
-      else
-        # Set current user namespace if namespace_id is nil
-        @project.namespace_id = current_user.namespace_id
-      end
+      namespace_id = params[:namespace_id] || current_user.namespace_id
+      @project.namespace_id = namespace_id.to_i
+
+      @project.check_personal_projects_limit
+      return @project if @project.errors.any?
+
+      validate_create_permissions
+      return @project if @project.errors.any?
 
       @relations_block&.call(@project)
       yield(@project) if block_given?
@@ -92,7 +86,9 @@ def execute
 
     protected
 
-    def deny_namespace
+    def validate_create_permissions
+      return if current_user.can?(:create_projects, parent_namespace)
+
       @project.errors.add(:namespace, "is not valid")
     end
 
diff --git a/spec/services/projects/create_service_spec.rb b/spec/services/projects/create_service_spec.rb
index 59dee209ff99d0776046a71f8a16f6ccc2f2c8ed..9694ce40fdb4f1fa32822a3729f1a6586eb123d8 100644
--- a/spec/services/projects/create_service_spec.rb
+++ b/spec/services/projects/create_service_spec.rb
@@ -254,6 +254,39 @@
     end
   end
 
+  context 'user with project limit' do
+    let_it_be(:user_with_projects_limit) { create(:user, projects_limit: 0) }
+
+    let(:params) { opts.merge!(namespace_id: target_namespace.id) }
+
+    subject(:project) { create_project(user_with_projects_limit, params) }
+
+    context 'under personal namespace' do
+      let(:target_namespace) { user_with_projects_limit.namespace }
+
+      it 'cannot create a project' do
+        expect(project.errors.errors.length).to eq 1
+        expect(project.errors.messages[:limit_reached].first).to eq(_('Personal project creation is not allowed. Please contact your administrator with questions'))
+      end
+    end
+
+    context 'under group namespace' do
+      let_it_be(:group) do
+        create(:group).tap do |group|
+          group.add_owner(user_with_projects_limit)
+        end
+      end
+
+      let(:target_namespace) { group }
+
+      it 'can create a project' do
+        expect(project).to be_valid
+        expect(project).to be_saved
+        expect(project.errors.errors.length).to eq 0
+      end
+    end
+  end
+
   context 'membership overrides', :sidekiq_inline do
     let_it_be(:group) { create(:group, :private) }
     let_it_be(:subgroup_for_projects) { create(:group, :private, parent: group) }