diff --git a/lib/schema/SubdocumentPath.js b/lib/schema/SubdocumentPath.js
index d3066839831..9486a302248 100644
--- a/lib/schema/SubdocumentPath.js
+++ b/lib/schema/SubdocumentPath.js
@@ -17,6 +17,7 @@ const geospatial = require('./operators/geospatial');
 const getConstructor = require('../helpers/discriminator/getConstructor');
 const handleIdOption = require('../helpers/schema/handleIdOption');
 const internalToObjectOptions = require('../options').internalToObjectOptions;
+const isExclusive = require('../helpers/projection/isExclusive');
 const utils = require('../utils');
 
 let Subdocument;
@@ -173,7 +174,8 @@ SubdocumentPath.prototype.cast = function(val, doc, init, priorVal, options) {
     subdoc = new Constructor(void 0, selected, doc, false, { defaults: false });
     delete subdoc.$__.defaults;
     subdoc.$init(val);
-    applyDefaults(subdoc, selected);
+    const exclude = isExclusive(selected);
+    applyDefaults(subdoc, selected, exclude);
   } else {
     options = Object.assign({}, options, { priorDoc: priorVal });
     if (Object.keys(val).length === 0) {
diff --git a/test/document.test.js b/test/document.test.js
index 5eb33c0f86f..f81adace7dc 100644
--- a/test/document.test.js
+++ b/test/document.test.js
@@ -12296,6 +12296,22 @@ describe('document', function() {
     assert.strictEqual(test.polluted, undefined);
     assert.strictEqual(Object.prototype.polluted, undefined);
   });
+
+  it('sets defaults on subdocs with subdoc projection (gh-13720)', async function() {
+    const subSchema = new mongoose.Schema({
+      propertyA: { type: String, default: 'A' },
+      propertyB: { type: String, default: 'B' }
+    });
+    const userSchema = new mongoose.Schema({
+      name: String,
+      sub: { type: subSchema, default: () => ({}) }
+    });
+    const User = db.model('User', userSchema);
+    await User.insertMany([{ name: 'user' }]);
+    await User.updateMany({}, { $unset: { 'sub.propertyA': '' } });
+    const nestedProjectionDoc = await User.findOne({}, { name: 1, 'sub.propertyA': 1, 'sub.propertyB': 1 });
+    assert.strictEqual(nestedProjectionDoc.sub.propertyA, 'A');
+  });
 });
 
 describe('Check if instance function that is supplied in schema option is availabe', function() {
diff --git a/types/augmentations.d.ts b/types/augmentations.d.ts
index fe72cb1aa3f..82aca589ff8 100644
--- a/types/augmentations.d.ts
+++ b/types/augmentations.d.ts
@@ -6,4 +6,4 @@ declare module 'bson' {
     /** Mongoose automatically adds a conveniency "_id" getter on the base ObjectId class */
     _id: this;
   }
-}
\ No newline at end of file
+}