diff --git a/cosmos/dbt/selector.py b/cosmos/dbt/selector.py
index d067d77b77..fc10482207 100644
--- a/cosmos/dbt/selector.py
+++ b/cosmos/dbt/selector.py
@@ -1,5 +1,6 @@
 from __future__ import annotations
 from pathlib import Path
+import copy
 
 from typing import TYPE_CHECKING
 
@@ -43,6 +44,10 @@ def __init__(self, project_dir: Path, statement: str):
         self.other: list[str] = []
         self.load_from_statement(statement)
 
+    @property
+    def is_empty(self) -> bool:
+        return not (self.paths or self.tags or self.config or self.other)
+
     def load_from_statement(self, statement: str) -> None:
         """
         Load in-place select parameters.
@@ -84,27 +89,30 @@ def select_nodes_ids_by_intersection(nodes: dict[str, DbtNode], config: Selector
     https://docs.getdbt.com/reference/node-selection/yaml-selectors
     """
     selected_nodes = set()
-    for node_id, node in nodes.items():
-        if config.tags and not (sorted(node.tags) == sorted(config.tags)):
-            continue
 
-        supported_node_config = {key: value for key, value in node.config.items() if key in SUPPORTED_CONFIG}
-        if config.config:
-            config_tag = config.config.get("tags")
-            if config_tag and config_tag not in supported_node_config.get("tags", []):
+    if not config.is_empty:
+        for node_id, node in nodes.items():
+            if config.tags and not (sorted(node.tags) == sorted(config.tags)):
                 continue
 
-            # Remove 'tags' as they've already been filtered for
-            config.config.pop("tags", None)
-            supported_node_config.pop("tags", None)
+            supported_node_config = {key: value for key, value in node.config.items() if key in SUPPORTED_CONFIG}
+            config_tag = config.config.get("tags")
+            if config.config:
+                if config_tag and config_tag not in supported_node_config.get("tags", []):
+                    continue
+
+                # Remove 'tags' as they've already been filtered for
+                config_copy = copy.deepcopy(config.config)
+                config_copy.pop("tags", None)
+                supported_node_config.pop("tags", None)
 
-            if not (config.config.items() <= supported_node_config.items()):
-                continue
+                if not (config_copy.items() <= supported_node_config.items()):
+                    continue
 
-        if config.paths and not (set(config.paths).issubset(set(node.file_path.parents))):
-            continue
+            if config.paths and not (set(config.paths).issubset(set(node.file_path.parents))):
+                continue
 
-        selected_nodes.add(node_id)
+            selected_nodes.add(node_id)
 
     return selected_nodes
 
@@ -166,9 +174,10 @@ def select_nodes(
 
     nodes_ids = set(nodes.keys())
 
+    exclude_ids: set[str] = set()
     for statement in exclude:
         config = SelectorConfig(project_dir, statement)
-        exclude_ids = select_nodes_ids_by_intersection(nodes, config)
+        exclude_ids = exclude_ids.union(set(select_nodes_ids_by_intersection(nodes, config)))
         subset_ids = set(nodes_ids) - set(exclude_ids)
 
     return {id_: nodes[id_] for id_ in subset_ids}
diff --git a/tests/dbt/test_selector.py b/tests/dbt/test_selector.py
index ac404b14a6..7c6ff32922 100644
--- a/tests/dbt/test_selector.py
+++ b/tests/dbt/test_selector.py
@@ -2,6 +2,7 @@
 
 import pytest
 
+from cosmos.dbt.selector import SelectorConfig
 from cosmos.constants import DbtResourceType
 from cosmos.dbt.graph import DbtNode
 from cosmos.dbt.selector import select_nodes
@@ -9,6 +10,34 @@
 
 SAMPLE_PROJ_PATH = Path("/home/user/path/dbt-proj/")
 
+
+@pytest.fixture
+def selector_config():
+    project_dir = Path("/path/to/project")
+    statement = ""
+    return SelectorConfig(project_dir, statement)
+
+
+@pytest.mark.parametrize(
+    "paths, tags, config, other, expected",
+    [
+        ([], [], {}, [], True),
+        ([Path("path1")], [], {}, [], False),
+        ([], ["tag:has_child"], {}, [], False),
+        ([], [], {"config.tags:test"}, [], False),
+        ([], [], {}, ["other"], False),
+        ([Path("path1")], ["tag:has_child"], {"config.tags:test"}, ["other"], False),
+    ],
+)
+def test_is_empty_config(selector_config, paths, tags, config, other, expected):
+    selector_config.paths = paths
+    selector_config.tags = tags
+    selector_config.config = config
+    selector_config.other = other
+
+    assert selector_config.is_empty == expected
+
+
 grandparent_node = DbtNode(
     name="grandparent",
     unique_id="grandparent",
@@ -37,10 +66,32 @@
     config={"materialized": "table", "tags": ["is_child"]},
 )
 
+grandchild_1_test_node = DbtNode(
+    name="grandchild_1",
+    unique_id="grandchild_1",
+    resource_type=DbtResourceType.MODEL,
+    depends_on=["parent"],
+    file_path=SAMPLE_PROJ_PATH / "gen3/models/grandchild_1.sql",
+    tags=["nightly"],
+    config={"materialized": "table", "tags": ["deprecated", "test"]},
+)
+
+grandchild_2_test_node = DbtNode(
+    name="grandchild_2",
+    unique_id="grandchild_2",
+    resource_type=DbtResourceType.MODEL,
+    depends_on=["parent"],
+    file_path=SAMPLE_PROJ_PATH / "gen3/models/grandchild_2.sql",
+    tags=["nightly"],
+    config={"materialized": "table", "tags": ["deprecated", "test2"]},
+)
+
 sample_nodes = {
     grandparent_node.unique_id: grandparent_node,
     parent_node.unique_id: parent_node,
     child_node.unique_id: child_node,
+    grandchild_1_test_node.unique_id: grandchild_1_test_node,
+    grandchild_2_test_node.unique_id: grandchild_2_test_node,
 }
 
 
@@ -52,13 +103,19 @@ def test_select_nodes_by_select_tag():
 
 def test_select_nodes_by_select_config():
     selected = select_nodes(project_dir=SAMPLE_PROJ_PATH, nodes=sample_nodes, select=["config.materialized:table"])
-    expected = {child_node.unique_id: child_node}
+    expected = {
+        child_node.unique_id: child_node,
+        grandchild_1_test_node.unique_id: grandchild_1_test_node,
+        grandchild_2_test_node.unique_id: grandchild_2_test_node,
+    }
     assert selected == expected
 
 
 def test_select_nodes_by_select_config_tag():
     selected = select_nodes(project_dir=SAMPLE_PROJ_PATH, nodes=sample_nodes, select=["config.tags:is_child"])
-    expected = {child_node.unique_id: child_node}
+    expected = {
+        child_node.unique_id: child_node,
+    }
     assert selected == expected
 
 
@@ -74,6 +131,21 @@ def test_select_nodes_by_select_union_config_tag():
     assert selected == expected
 
 
+def test_select_nodes_by_select_union_config_test_tags():
+    selected = select_nodes(
+        project_dir=SAMPLE_PROJ_PATH,
+        nodes=sample_nodes,
+        select=["config.tags:test", "config.tags:test2", "config.materialized:view"],
+    )
+    expected = {
+        grandparent_node.unique_id: grandparent_node,
+        parent_node.unique_id: parent_node,
+        grandchild_1_test_node.unique_id: grandchild_1_test_node,
+        grandchild_2_test_node.unique_id: grandchild_2_test_node,
+    }
+    assert selected == expected
+
+
 def test_select_nodes_by_select_intersection_config_tag():
     selected = select_nodes(
         project_dir=SAMPLE_PROJ_PATH, nodes=sample_nodes, select=["config.tags:is_child,config.materialized:view"]
@@ -95,6 +167,8 @@ def test_select_nodes_by_select_union():
         grandparent_node.unique_id: grandparent_node,
         parent_node.unique_id: parent_node,
         child_node.unique_id: child_node,
+        grandchild_1_test_node.unique_id: grandchild_1_test_node,
+        grandchild_2_test_node.unique_id: grandchild_2_test_node,
     }
     assert selected == expected
 
@@ -106,7 +180,11 @@ def test_select_nodes_by_select_intersection():
 
 def test_select_nodes_by_exclude_tag():
     selected = select_nodes(project_dir=SAMPLE_PROJ_PATH, nodes=sample_nodes, exclude=["tag:has_child"])
-    expected = {child_node.unique_id: child_node}
+    expected = {
+        child_node.unique_id: child_node,
+        grandchild_1_test_node.unique_id: grandchild_1_test_node,
+        grandchild_2_test_node.unique_id: grandchild_2_test_node,
+    }
     assert selected == expected
 
 
@@ -122,3 +200,15 @@ def test_select_nodes_by_select_union_exclude_tags():
     )
     expected = {}
     assert selected == expected
+
+
+def test_select_nodes_by_exclude_union_config_test_tags():
+    selected = select_nodes(
+        project_dir=SAMPLE_PROJ_PATH, nodes=sample_nodes, exclude=["config.tags:test", "config.tags:test2"]
+    )
+    expected = {
+        grandparent_node.unique_id: grandparent_node,
+        parent_node.unique_id: parent_node,
+        child_node.unique_id: child_node,
+    }
+    assert selected == expected