diff --git a/src/schema_compile.c b/src/schema_compile.c
index 58d458a..600646e 100644
--- a/src/schema_compile.c
+++ b/src/schema_compile.c
@@ -1523,6 +1523,11 @@
 
         v = 0;
         while ((lref = lys_type_leafref_next(l->node, &v))) {
+            if (!lref->require_instance) {
+                /* the target may be disabled without consequences */
+                continue;
+            }
+
             ret = ly_path_compile_leafref(cctx.ctx, l->node, NULL, lref->path,
                     (l->node->flags & LYS_IS_OUTPUT) ? LY_PATH_OPER_OUTPUT : LY_PATH_OPER_INPUT, LY_PATH_TARGET_MANY,
                     LY_VALUE_SCHEMA_RESOLVED, lref->prefixes, &path);