diff --git a/changelog/8463.enhancement.md b/changelog/8463.enhancement.md
new file mode 100644
index 000000000000..2875caa62965
--- /dev/null
+++ b/changelog/8463.enhancement.md
@@ -0,0 +1 @@
+Change variables name on `.../shared/core/domain.py` lines `250` and `252`.
diff --git a/rasa/shared/core/domain.py b/rasa/shared/core/domain.py
index 794022ac5116..ce2cdf2ad096 100644
--- a/rasa/shared/core/domain.py
+++ b/rasa/shared/core/domain.py
@@ -257,12 +257,13 @@ def merge_dicts(
             d2: Dict[Text, Any],
             override_existing_values: bool = False,
         ) -> Dict[Text, Any]:
+            dict1_copy, dict2_copy = d1.copy(), d2.copy()
             if override_existing_values:
-                a, b = d1.copy(), d2.copy()
+                dict1_copy.update(dict2_copy)
+                return dict1_copy
             else:
-                a, b = d2.copy(), d1.copy()
-            a.update(b)
-            return a
+                dict2_copy.update(dict1_copy)
+                return dict2_copy
 
         def merge_lists(l1: List[Any], l2: List[Any]) -> List[Any]:
             return sorted(list(set(l1 + l2)))