Variables can be defined in a locals block. Let's say you have the following files on your Terraform server.

├── locals.tf
├── modules.tf
├── outputs.tf
├── provider.tf
├── terraform.tfstate
├── variables.tf
├── child (directory, child module)
│   ├── data.tf
│   ├── outputs.tf
│   ├── resources.tf

And let's say locals.tf has the following.

locals {
  environment = "dev"
}

And let's say resources.tf in your child module has the following. In this example, the "environment" variable contains a value of "dev" to create an Amazon Web Services (AWS) Virtual Private Cloud (VPC) named dev-my-vpc.

resource "aws_vpc" "my-vpc" {
  cidr_block = "10.0.0.0/16"
  tags = {
    Name = "${local.environment}-my-vpc"
  }
}