diff --git a/modelrunner/model.py b/modelrunner/model.py
index 69e7ca5..21226f9 100644
--- a/modelrunner/model.py
+++ b/modelrunner/model.py
@@ -18,11 +18,14 @@
     Any,
     Callable,
     Dict,
+    Literal,
     Optional,
     Sequence,
     Type,
     TypeVar,
     Union,
+    get_args,
+    get_origin,
 )
 
 from .parameters import (
@@ -329,14 +332,21 @@ def make_model_class(func: Callable, *, default: bool = False) -> Type[ModelBase
             # all remaining parameters are treated as model parameters
             if param.annotation is param.empty:
                 cls = object
+                choices = None
+            elif get_origin(param.annotation) is Literal:
+                cls = object
+                choices = get_args(param.annotation)
             else:
                 cls = param.annotation
+                choices = None
             if param.default is param.empty:
                 default_value = NoValue
             else:
                 default_value = param.default
 
-            parameter = Parameter(name, default_value=default_value, cls=cls)
+            parameter = Parameter(
+                name, default_value=default_value, cls=cls, choices=choices
+            )
             parameters_default.append(parameter)
 
     def __call__(self, *args, **kwargs):
diff --git a/modelrunner/parameters.py b/modelrunner/parameters.py
index d992c01..7c44781 100644
--- a/modelrunner/parameters.py
+++ b/modelrunner/parameters.py
@@ -124,7 +124,8 @@ def __post_init__(self):
                 converted_value = self.cls(self.default_value)
             except TypeError as err:
                 raise TypeError(
-                    f"Parameter {self.name} has invalid default: {self.default_value}"
+                    f"Parameter {self.name} of type {self.cls} has invalid default "
+                    f"value: {self.default_value}"
                 ) from err
 
             self._check_value(converted_value)
diff --git a/tests/test_model.py b/tests/test_model.py
index 363d1f1..e22133d 100644
--- a/tests/test_model.py
+++ b/tests/test_model.py
@@ -3,7 +3,7 @@
 """
 
 from pathlib import Path
-from typing import List  # @UnusedImport
+from typing import Literal
 
 import pytest
 
@@ -206,6 +206,25 @@ def model_func(a=2):
     assert model({"a": 4}).get_result().data == 16
 
 
+def test_make_model_class_literal_args():
+    """test the make_model_class function"""
+
+    def model_func(a: Literal["a", 2] = 2):
+        return a * 2
+
+    model = make_model_class(model_func)
+    assert model.parameters_default[0].choices == ("a", 2)
+
+    assert model()() == 4
+    assert model({"a": "a"})() == "aa"
+    with pytest.raises(ValueError):
+        model({"a": 3})
+
+    assert model.run_from_command_line(["--a", "a"]).data == "aa"
+    with pytest.raises(SystemExit):
+        model.run_from_command_line(["--a", "b"])
+
+
 def test_argparse_boolean_arguments():
     """test boolean parameters"""