diff --git a/internal/test/schemas/nullable/nullable.gen.go b/internal/test/schemas/nullable/nullable.gen.go
index 940611a65..9a45381fc 100644
--- a/internal/test/schemas/nullable/nullable.gen.go
+++ b/internal/test/schemas/nullable/nullable.gen.go
@@ -37,6 +37,15 @@ type Container struct {
 	MayBeNull []nullable.Nullable[string] `json:"may-be-null"`
 }
 
+// DecoratableValue defines model for DecoratableValue.
+type DecoratableValue = string
+
+// DecoratedRef defines model for DecoratedRef.
+type DecoratedRef struct {
+	OptionalNullableRef nullable.Nullable[string] `json:"optional_nullable_ref,omitempty"`
+	RequiredNullableRef nullable.Nullable[string] `json:"required_nullable_ref"`
+}
+
 // PatchRequest A request to patch an existing user object.
 type PatchRequest struct {
 	// ComplexOptionalNullable Complex, optional and nullable
diff --git a/internal/test/schemas/nullable/nullable_test.go b/internal/test/schemas/nullable/nullable_test.go
index ca9f7f2e9..e8aa4d562 100644
--- a/internal/test/schemas/nullable/nullable_test.go
+++ b/internal/test/schemas/nullable/nullable_test.go
@@ -219,6 +219,46 @@ func TestContainer_UsesNullableType(t *testing.T) {
 	require.True(t, c.MayBeNull[0].IsNull())
 }
 
+// ---- issue #1898: allOf decorating a $ref with `nullable: true` ----
+
+// TestDecoratedRef_AllOfNullable covers the OpenAPI 3.0 idiom of making a
+// referenced schema nullable by wrapping it in an allOf next to an inline
+// `{nullable: true}` (issue #1898). Before the fix this failed generation
+// with "merging two schemas with different Nullable"; now the decorated
+// $ref is generated as a nullable.Nullable[T] field under nullable-type:true,
+// for both required and optional properties.
+func TestDecoratedRef_AllOfNullable(t *testing.T) {
+	// Compile-time proof of the field types: these only assign if both
+	// fields are nullable.Nullable[string].
+	d := DecoratedRef{
+		RequiredNullableRef: nullable.NewNullableWithValue("present"),
+		OptionalNullableRef: nullable.NewNullNullable[string](),
+	}
+
+	val, err := d.RequiredNullableRef.Get()
+	require.NoError(t, err)
+	assert.Equal(t, "present", val)
+	assert.True(t, d.OptionalNullableRef.IsNull())
+
+	// Explicit null on the required field marshals to JSON null; the
+	// optional-but-unset field is omitted.
+	d = DecoratedRef{
+		RequiredNullableRef: nullable.NewNullNullable[string](),
+	}
+	actual, err := json.Marshal(d)
+	require.NoError(t, err)
+	assert.JSONEq(t, `{"required_nullable_ref":null}`, string(actual))
+
+	// A value on the required field round-trips.
+	d = DecoratedRef{
+		RequiredNullableRef: nullable.NewNullableWithValue("hello"),
+		OptionalNullableRef: nullable.NewNullableWithValue("world"),
+	}
+	actual, err = json.Marshal(d)
+	require.NoError(t, err)
+	assert.JSONEq(t, `{"required_nullable_ref":"hello","optional_nullable_ref":"world"}`, string(actual))
+}
+
 // ---- openapi31_nullable: 3.0 vs 3.1 nullable idiom equivalence ----
 
 // TestNicknameIsPointer_3_0 asserts that the 3.0 spec's `nullable: true`
diff --git a/internal/test/schemas/nullable/spec.yaml b/internal/test/schemas/nullable/spec.yaml
index d3c2742d9..1e3995d25 100644
--- a/internal/test/schemas/nullable/spec.yaml
+++ b/internal/test/schemas/nullable/spec.yaml
@@ -96,3 +96,27 @@ components:
           items:
             type: string
             nullable: true
+
+    # issue #1898: decorate a $ref with `nullable: true` via allOf. OpenAPI 3.0
+    # forbids siblings next to $ref, so allOf is the only way to add nullability
+    # to a referenced schema. Before the fix this errored with "merging two
+    # schemas with different Nullable". The inline member carries no structural
+    # content, so the merged type is the referenced value made nullable.
+    DecoratedRef:
+      type: object
+      required:
+        - required_nullable_ref
+      properties:
+        required_nullable_ref:
+          # required + nullable(via allOf) -> nullable.Nullable[...]
+          allOf:
+            - $ref: "#/components/schemas/DecoratableValue"
+            - nullable: true
+        optional_nullable_ref:
+          # optional + nullable(via allOf) -> nullable.Nullable[...]
+          allOf:
+            - $ref: "#/components/schemas/DecoratableValue"
+            - nullable: true
+
+    DecoratableValue:
+      type: string
diff --git a/pkg/codegen/merge_schemas.go b/pkg/codegen/merge_schemas.go
index 537737913..0585044a0 100644
--- a/pkg/codegen/merge_schemas.go
+++ b/pkg/codegen/merge_schemas.go
@@ -356,11 +356,24 @@ func mergeOpenapiSchemas(s1, s2 openapi3.Schema, allOf bool, seenSchemaRef map[s
 	// without needing to touch result.Nullable. The result.Nullable copy
 	// below is a no-op in 3.1 (s1.Nullable is always false there) but kept
 	// for 3.0 correctness, where Nullable is the only nullability carrier.
-	if schemaIsNullable(&s1) != schemaIsNullable(&s2) {
-		return openapi3.Schema{}, errors.New("merging two schemas with different Nullable")
-
+	//
+	// Nullability is UNIONed rather than required to match: if any member
+	// is nullable, the merged schema is nullable. This supports the common
+	// OpenAPI 3.0 idiom of decorating a $ref with nullability, which is only
+	// expressible through allOf because 3.0 forbids siblings next to $ref
+	// (issue #1898):
+	//
+	//   allOf:
+	//     - $ref: "#/components/schemas/user"
+	//     - nullable: true
+	//
+	// kin-openapi represents Nullable as a plain bool, so an unset value is
+	// indistinguishable from an explicit `nullable: false`; erroring on a
+	// mismatch made this widely-used idiom unusable. Union is also
+	// consistent with how Required is merged below.
+	if schemaIsNullable(&s1) || schemaIsNullable(&s2) {
+		result.Nullable = true
 	}
-	result.Nullable = s1.Nullable
 
 	if s1.ReadOnly != s2.ReadOnly {
 		return openapi3.Schema{}, errors.New("merging two schemas with different ReadOnly")
diff --git a/pkg/codegen/merge_schemas_test.go b/pkg/codegen/merge_schemas_test.go
index 61fcbef12..15d2b1364 100644
--- a/pkg/codegen/merge_schemas_test.go
+++ b/pkg/codegen/merge_schemas_test.go
@@ -66,3 +66,44 @@ func TestMergeOpenapiSchemas_DiscriminatorPropagation(t *testing.T) {
 		require.Error(t, err)
 	})
 }
+
+// TestMergeOpenapiSchemas_NullableUnion covers the OpenAPI 3.0 idiom of
+// decorating a $ref with `nullable: true` via allOf (issue #1898). Members
+// disagreeing on nullability must merge (union) rather than error.
+func TestMergeOpenapiSchemas_NullableUnion(t *testing.T) {
+	t.Run("nullable on s2 propagates to result", func(t *testing.T) {
+		s1 := openapi3.Schema{}
+		s2 := openapi3.Schema{Nullable: true}
+
+		result, err := mergeOpenapiSchemas(s1, s2, true, make(map[string]bool))
+		require.NoError(t, err)
+		assert.True(t, result.Nullable)
+	})
+
+	t.Run("nullable on s1 propagates to result", func(t *testing.T) {
+		s1 := openapi3.Schema{Nullable: true}
+		s2 := openapi3.Schema{}
+
+		result, err := mergeOpenapiSchemas(s1, s2, true, make(map[string]bool))
+		require.NoError(t, err)
+		assert.True(t, result.Nullable)
+	})
+
+	t.Run("both nullable stays nullable", func(t *testing.T) {
+		s1 := openapi3.Schema{Nullable: true}
+		s2 := openapi3.Schema{Nullable: true}
+
+		result, err := mergeOpenapiSchemas(s1, s2, true, make(map[string]bool))
+		require.NoError(t, err)
+		assert.True(t, result.Nullable)
+	})
+
+	t.Run("neither nullable stays non-nullable", func(t *testing.T) {
+		s1 := openapi3.Schema{}
+		s2 := openapi3.Schema{}
+
+		result, err := mergeOpenapiSchemas(s1, s2, true, make(map[string]bool))
+		require.NoError(t, err)
+		assert.False(t, result.Nullable)
+	})
+}
diff --git a/pkg/codegen/schema.go b/pkg/codegen/schema.go
index 5d517eb26..0972159cc 100644
--- a/pkg/codegen/schema.go
+++ b/pkg/codegen/schema.go
@@ -468,9 +468,41 @@ func PropertiesEqual(a, b Property) bool {
 // using `type: [..., "null"]`) is documented as invalid input -- this
 // helper trusts its input to use the version-appropriate idiom.
 func schemaIsNullable(s *openapi3.Schema) bool {
+	return schemaIsNullableRec(s, nil)
+}
+
+// schemaIsNullableRec is schemaIsNullable's implementation, carrying a
+// `seen` set of already-visited schema values so that a cyclic allOf (a
+// $ref member resolving back to an ancestor — the same cycles
+// mergeOpenapiSchemas guards against) cannot cause unbounded recursion.
+// The set is allocated lazily: the common case (no allOf) never touches it.
+func schemaIsNullableRec(s *openapi3.Schema, seen map[*openapi3.Schema]bool) bool {
 	if s == nil {
 		return false
 	}
+	// A nullable member inside an allOf makes the whole schema nullable.
+	// In OpenAPI 3.0, allOf is the only place a sibling (`nullable: true`)
+	// may sit next to a $ref, so wrapping a $ref in allOf is the idiomatic
+	// way to decorate a referenced schema as nullable (issue #1898). This
+	// is where the flag lives — the outer schema's own Nullable is unset —
+	// so descend into the members. Descent is transitive to match the
+	// transitive allOf flattening in mergeOpenapiSchemas, and equally valid
+	// under 3.1's type-array idiom, hence checked before the version
+	// branch. mergeOpenapiSchemas unions nullability into the merged type;
+	// this surfaces it at the use site so the field is wrapped in a pointer
+	// / nullable.Nullable[T].
+	for _, member := range s.AllOf {
+		if member == nil || member.Value == nil || seen[member.Value] {
+			continue
+		}
+		if seen == nil {
+			seen = make(map[*openapi3.Schema]bool)
+		}
+		seen[member.Value] = true
+		if schemaIsNullableRec(member.Value, seen) {
+			return true
+		}
+	}
 	if globalState.is31 {
 		if s.Type != nil && s.Type.Includes("null") {
 			return true