diff --git a/NEWS.md b/NEWS.md
index a3f71cbe67..7e8b895f2d 100644
--- a/NEWS.md
+++ b/NEWS.md
@@ -149,6 +149,8 @@ rowwiseDT(
 
 11. Deprecation of `fread(autostart=)` has been upgraded to an error. It has been warning since v1.11.0 (6 years ago). The argument will be removed in the next release.
 
+12. Deprecation of `droplevels(in.place=TRUE)` (warning since v1.16.0) has been upgraded from warning to error. The argument will be removed in the next release.
+
 # data.table [v1.16.4](https://github.com/Rdatatable/data.table/milestone/36) 4 December 2024
 
 ## BUG FIXES
diff --git a/R/fdroplevels.R b/R/fdroplevels.R
index 3116a3f85f..642b76e090 100644
--- a/R/fdroplevels.R
+++ b/R/fdroplevels.R
@@ -8,10 +8,9 @@ fdroplevels = function(x, exclude = if (anyNA(levels(x))) NULL else NA, ...) {
   return(ans)
 }
 
-droplevels.data.table = function(x, except=NULL, exclude, in.place=FALSE, ...){
-  stopifnot(is.logical(in.place))
-  if (isTRUE(in.place)) warningf("droplevels() with in.place=TRUE is deprecated. Use setdroplevels() instead.")
-  if (!in.place) x = copy(x)
+droplevels.data.table = function(x, except=NULL, exclude, in.place=NULL, ...){
+  if (!is.null(in.place)) stopf("droplevels() with in.place=TRUE is deprecated. Use setdroplevels() instead.")
+  x = copy(x)
   if (missing(exclude)) exclude = NULL
   setdroplevels(x, except, exclude)[]
 }
diff --git a/inst/tests/tests.Rraw b/inst/tests/tests.Rraw
index 004f6c8ea6..4153b79125 100644
--- a/inst/tests/tests.Rraw
+++ b/inst/tests/tests.Rraw
@@ -17785,7 +17785,7 @@ if (base::getRversion() >= "3.4.0") {
 }
 test(2214.06, droplevels(DT)[["a"]], droplevels(DT[1:5,a]))
 test(2214.07, droplevels(DT, 1)[["a"]], x[1:5])
-test(2214.08, droplevels(DT, in.place=TRUE), DT, warning="droplevels() with in.place=TRUE is deprecated.")
+test(2214.08, droplevels(DT, in.place=TRUE), error="droplevels() with in.place=TRUE is deprecated.")
 # support ordered factors in fdroplevels
 o = factor(letters[1:10], ordered=TRUE)
 test(2214.09, fdroplevels(o[1:5]), droplevels(o[1:5]))
diff --git a/man/fdroplevels.Rd b/man/fdroplevels.Rd
index 724399d20a..4a7423a44c 100644
--- a/man/fdroplevels.Rd
+++ b/man/fdroplevels.Rd
@@ -12,13 +12,13 @@
 fdroplevels(x, exclude = if (anyNA(levels(x))) NULL else NA, \dots)
 setdroplevels(x, except = NULL, exclude = NULL)
 
-\method{droplevels}{data.table}(x, except = NULL, exclude, in.place = FALSE, \dots)
+\method{droplevels}{data.table}(x, except = NULL, exclude, in.place = NULL, \dots)
 }
 \arguments{
   \item{x}{ \code{factor} or \code{data.table} where unused levels should be dropped. }
   \item{exclude}{ A \code{character} vector of factor levels which are dropped no matter of presented or not. }
   \item{except}{ An \code{integer} vector of indices of data.table columns which are not modified by dropping levels. }
-  \item{in.place}{ logical (default is \code{FALSE}). If \code{TRUE} levels of factors of \code{data.table} are modified in-place. }
+  \item{in.place}{ Deprecated. Use \code{setdroplevels} for in-place modification. }
   \item{\dots}{ further arguments passed to methods }
 }