diff --git a/changelog.d/14361.bugfix b/changelog.d/14361.bugfix
new file mode 100644
index 0000000000..33ba1d92af
--- /dev/null
+++ b/changelog.d/14361.bugfix
@@ -0,0 +1 @@
+Fix a bug introduced in v1.71.0rc1 where the power level event was incorrectly created during initial room creation.
\ No newline at end of file
diff --git a/synapse/handlers/room.py b/synapse/handlers/room.py
index f10cfca073..66a50bca6e 100644
--- a/synapse/handlers/room.py
+++ b/synapse/handlers/room.py
@@ -1080,6 +1080,19 @@ class RoomCreationHandler:
             for_batch: bool,
             **kwargs: Any,
         ) -> Tuple[EventBase, synapse.events.snapshot.EventContext]:
+            """
+            Creates an event and associated event context.
+            Args:
+                etype: the type of event to be created
+                content: content of the event
+                for_batch: whether the event is being created for batch persisting. If
+                bool for_batch is true, this will create an event using the prev_event_ids,
+                and will create an event context for the event using the parameters state_map
+                and current_state_group, thus these parameters must be provided in this
+                case if for_batch is True. The subsequently created event and context
+                are suitable for being batched up and bulk persisted to the database
+                with other similarly created events.
+            """
             nonlocal depth
             nonlocal prev_event
 
@@ -1139,13 +1152,21 @@ class RoomCreationHandler:
         depth += 1
         state_map[(EventTypes.Member, creator.user.to_string())] = member_event_id
 
+        # we need the state group of the membership event as it is the current state group
+        event_to_state = (
+            await self._storage_controllers.state.get_state_group_for_events(
+                [member_event_id]
+            )
+        )
+        current_state_group = event_to_state[member_event_id]
+
         events_to_send = []
         # We treat the power levels override specially as this needs to be one
         # of the first events that get sent into a room.
         pl_content = initial_state.pop((EventTypes.PowerLevels, ""), None)
         if pl_content is not None:
             power_event, power_context = await create_event(
-                EventTypes.PowerLevels, pl_content, False
+                EventTypes.PowerLevels, pl_content, True
             )
             current_state_group = power_context._state_group
             events_to_send.append((power_event, power_context))
@@ -1194,7 +1215,7 @@ class RoomCreationHandler:
             pl_event, pl_context = await create_event(
                 EventTypes.PowerLevels,
                 power_level_content,
-                False,
+                True,
             )
             current_state_group = pl_context._state_group
             events_to_send.append((pl_event, pl_context))
diff --git a/tests/rest/client/test_rooms.py b/tests/rest/client/test_rooms.py
index 1084d4ad9d..e919e089cb 100644
--- a/tests/rest/client/test_rooms.py
+++ b/tests/rest/client/test_rooms.py
@@ -715,7 +715,7 @@ class RoomsCreateTestCase(RoomBase):
         self.assertEqual(HTTPStatus.OK, channel.code, channel.result)
         self.assertTrue("room_id" in channel.json_body)
         assert channel.resource_usage is not None
-        self.assertEqual(34, channel.resource_usage.db_txn_count)
+        self.assertEqual(33, channel.resource_usage.db_txn_count)
 
     def test_post_room_initial_state(self) -> None:
         # POST with initial_state config key, expect new room id
@@ -728,7 +728,7 @@ class RoomsCreateTestCase(RoomBase):
         self.assertEqual(HTTPStatus.OK, channel.code, channel.result)
         self.assertTrue("room_id" in channel.json_body)
         assert channel.resource_usage is not None
-        self.assertEqual(37, channel.resource_usage.db_txn_count)
+        self.assertEqual(36, channel.resource_usage.db_txn_count)
 
     def test_post_room_visibility_key(self) -> None:
         # POST with visibility config key, expect new room id