diff --git a/CHANGES.rst b/CHANGES.rst
index dc3f5cbf..eeba61ab 100644
--- a/CHANGES.rst
+++ b/CHANGES.rst
@@ -19,6 +19,8 @@ Unreleased
     :issue:`4157`
 -   Correctly handle raising deferred errors in CLI lazy loading.
     :issue:`4096`
+-   The CLI loader handles ``**kwargs`` in a ``create_app`` function.
+    :issue:`4170`
 
 
 Version 2.0.1
diff --git a/src/flask/cli.py b/src/flask/cli.py
index 81191a1a..0d101d0a 100644
--- a/src/flask/cli.py
+++ b/src/flask/cli.py
@@ -103,18 +103,21 @@ def call_factory(script_info, app_factory, args=None, kwargs=None):
         )
         kwargs["script_info"] = script_info
 
-    if (
-        not args
-        and len(sig.parameters) == 1
-        and next(iter(sig.parameters.values())).default is inspect.Parameter.empty
-    ):
-        warnings.warn(
-            "Script info is deprecated and will not be passed as the"
-            " single argument to the app factory function in Flask"
-            " 2.1.",
-            DeprecationWarning,
-        )
-        args.append(script_info)
+    if not args and len(sig.parameters) == 1:
+        first_parameter = next(iter(sig.parameters.values()))
+
+        if (
+            first_parameter.default is inspect.Parameter.empty
+            # **kwargs is reported as an empty default, ignore it
+            and first_parameter.kind is not inspect.Parameter.VAR_KEYWORD
+        ):
+            warnings.warn(
+                "Script info is deprecated and will not be passed as the"
+                " single argument to the app factory function in Flask"
+                " 2.1.",
+                DeprecationWarning,
+            )
+            args.append(script_info)
 
     return app_factory(*args, **kwargs)
 
diff --git a/tests/test_cli.py b/tests/test_cli.py
index 5a666d8a..e7462bde 100644
--- a/tests/test_cli.py
+++ b/tests/test_cli.py
@@ -74,6 +74,15 @@ def test_find_best_app(test_apps):
     assert isinstance(app, Flask)
     assert app.name == "appname"
 
+    class Module:
+        @staticmethod
+        def create_app(**kwargs):
+            return Flask("appname")
+
+    app = find_best_app(script_info, Module)
+    assert isinstance(app, Flask)
+    assert app.name == "appname"
+
     class Module:
         @staticmethod
         def create_app(foo):