diff --git a/dlt/destinations/impl/duckdb/configuration.py b/dlt/destinations/impl/duckdb/configuration.py
index 06ae8482ef..bc04552078 100644
--- a/dlt/destinations/impl/duckdb/configuration.py
+++ b/dlt/destinations/impl/duckdb/configuration.py
@@ -1,15 +1,17 @@
 import os
 import dataclasses
 import threading
-from pathvalidate import is_valid_filepath
+
 from typing import Any, ClassVar, Dict, Final, List, Optional, Tuple, Type, Union
 
+from pathvalidate import is_valid_filepath
 from dlt.common import logger
 from dlt.common.configuration import configspec
 from dlt.common.configuration.specs import ConnectionStringCredentials
 from dlt.common.configuration.specs.exceptions import InvalidConnectionString
 from dlt.common.destination.reference import DestinationClientDwhWithStagingConfiguration
 from dlt.common.typing import TSecretValue
+from dlt.destinations.impl.duckdb.exceptions import InvalidInMemoryDuckdbCredentials
 
 try:
     from duckdb import DuckDBPyConnection
@@ -117,6 +119,9 @@ def is_partial(self) -> bool:
         return self.database == ":pipeline:"
 
     def on_resolved(self) -> None:
+        if isinstance(self.database, str) and self.database == ":memory:":
+            raise InvalidInMemoryDuckdbCredentials()
+
         # do not set any paths for external database
         if self.database == ":external:":
             return
diff --git a/dlt/destinations/impl/duckdb/exceptions.py b/dlt/destinations/impl/duckdb/exceptions.py
new file mode 100644
index 0000000000..7d2727c4c1
--- /dev/null
+++ b/dlt/destinations/impl/duckdb/exceptions.py
@@ -0,0 +1,11 @@
+from dlt.common.destination.exceptions import DestinationTerminalException
+
+
+class InvalidInMemoryDuckdbCredentials(DestinationTerminalException):
+    def __init__(self) -> None:
+        super().__init__(
+            "To use in-memory instance of duckdb, "
+            "please instantiate it first and then pass to destination factory\n"
+            '\nconn = duckdb.connect(":memory:")\n'
+            'dlt.pipeline(pipeline_name="...", destination=dlt.destinations.duckdb(conn)'
+        )
diff --git a/dlt/destinations/impl/duckdb/factory.py b/dlt/destinations/impl/duckdb/factory.py
index 6a0152df26..55fcd3b339 100644
--- a/dlt/destinations/impl/duckdb/factory.py
+++ b/dlt/destinations/impl/duckdb/factory.py
@@ -37,7 +37,7 @@ def __init__(
 
         Args:
             credentials: Credentials to connect to the duckdb database. Can be an instance of `DuckDbCredentials` or
-                a path to a database file. Use `:memory:` to create an in-memory database or :pipeline: to create a duckdb
+                a path to a database file. Use :pipeline: to create a duckdb
                 in the working folder of the pipeline
             create_indexes: Should unique indexes be created, defaults to False
             **kwargs: Additional arguments passed to the destination config
diff --git a/docs/website/docs/dlt-ecosystem/destinations/duckdb.md b/docs/website/docs/dlt-ecosystem/destinations/duckdb.md
index 546cf0756e..22c5fd1df9 100644
--- a/docs/website/docs/dlt-ecosystem/destinations/duckdb.md
+++ b/docs/website/docs/dlt-ecosystem/destinations/duckdb.md
@@ -102,30 +102,72 @@ p = dlt.pipeline(
 )
 ```
 
-The destination accepts a `duckdb` connection instance via `credentials`, so you can also open a database connection yourself and pass it to `dlt` to use. `:memory:` databases are supported.
+The destination accepts a `duckdb` connection instance via `credentials`, so you can also open a database connection yourself and pass it to `dlt` to use.
+
 ```py
 import duckdb
+
 db = duckdb.connect()
 p = dlt.pipeline(
-  pipeline_name='chess',
+  pipeline_name="chess",
   destination=dlt.destinations.duckdb(db),
-  dataset_name='chess_data',
+  dataset_name="chess_data",
   full_refresh=False,
 )
+
+# Or if you would like to use in-memory duckdb instance
+db = duckdb.connect(":memory:")
+p = pipeline_one = dlt.pipeline(
+  pipeline_name="in_memory_pipeline",
+  destination=dlt.destinations.duckdb(db),
+  dataset_name="chess_data",
+)
+
+print(db.sql("DESCRIBE;"))
+
+# Example output
+# ┌──────────┬───────────────┬─────────────────────┬──────────────────────┬───────────────────────┬───────────┐
+# │ database │    schema     │        name         │     column_names     │     column_types      │ temporary │
+# │ varchar  │    varchar    │       varchar       │      varchar[]       │       varchar[]       │  boolean  │
+# ├──────────┼───────────────┼─────────────────────┼──────────────────────┼───────────────────────┼───────────┤
+# │ memory   │ chess_data    │ _dlt_loads          │ [load_id, schema_n…  │ [VARCHAR, VARCHAR, …  │ false     │
+# │ memory   │ chess_data    │ _dlt_pipeline_state │ [version, engine_v…  │ [BIGINT, BIGINT, VA…  │ false     │
+# │ memory   │ chess_data    │ _dlt_version        │ [version, engine_v…  │ [BIGINT, BIGINT, TI…  │ false     │
+# │ memory   │ chess_data    │ my_table            │ [a, _dlt_load_id, …  │ [BIGINT, VARCHAR, V…  │ false     │
+# └──────────┴───────────────┴─────────────────────┴──────────────────────┴───────────────────────┴───────────┘
 ```
 
+:::note
+Be careful! The in-memory instance of the database will be destroyed, once your Python script exits.
+:::
+
 This destination accepts database connection strings in the format used by [duckdb-engine](https://github.com/Mause/duckdb_engine#configuration).
 
 You can configure a DuckDB destination with [secret / config values](../../general-usage/credentials) (e.g., using a `secrets.toml` file)
 ```toml
 destination.duckdb.credentials="duckdb:///_storage/test_quack.duckdb"
 ```
+
 The **duckdb://** URL above creates a **relative** path to `_storage/test_quack.duckdb`. To define an **absolute** path, you need to specify four slashes, i.e., `duckdb:////_storage/test_quack.duckdb`.
 
-A few special connection strings are supported:
-* **:pipeline:** creates the database in the working directory of the pipeline with the name `quack.duckdb`.
-* **:memory:** creates an in-memory database. This may be useful for testing.
+Dlt supports a unique connection string that triggers specific behavior for duckdb destination:
+* **:pipeline:** creates the database in the working directory of the pipeline, naming it `quack.duckdb`.
+
+Please see the code snippets below showing how to use it
 
+1. Via `config.toml`
+```toml
+destination.duckdb.credentials=":pipeline:"
+```
+
+2. In Python code
+```py
+p = pipeline_one = dlt.pipeline(
+  pipeline_name="my_pipeline",
+  destination="duckdb",
+  credentials=":pipeline:",
+)
+```
 
 ### Additional configuration
 Unique indexes may be created during loading if the following config value is set:
diff --git a/tests/load/duckdb/test_duckdb_client.py b/tests/load/duckdb/test_duckdb_client.py
index 896cba7d5a..8f6bf195e2 100644
--- a/tests/load/duckdb/test_duckdb_client.py
+++ b/tests/load/duckdb/test_duckdb_client.py
@@ -6,14 +6,15 @@
 from dlt.common.configuration.resolve import resolve_configuration
 from dlt.common.configuration.utils import get_resolved_traces
 
+from dlt.common.destination.reference import Destination
 from dlt.destinations.impl.duckdb.configuration import (
-    DUCK_DB_NAME,
     DuckDbClientConfiguration,
-    DuckDbCredentials,
     DEFAULT_DUCK_DB_NAME,
 )
 from dlt.destinations import duckdb
 
+from dlt.destinations.impl.duckdb.exceptions import InvalidInMemoryDuckdbCredentials
+from dlt.pipeline.exceptions import PipelineStepFailed
 from tests.load.pipeline.utils import drop_pipeline
 from tests.pipeline.utils import assert_table
 from tests.utils import patch_home_dir, autouse_test_storage, preserve_environ, TEST_STORAGE_ROOT
@@ -56,6 +57,44 @@ def test_duckdb_open_conn_default() -> None:
         delete_quack_db()
 
 
+def test_duckdb_in_memory_mode_via_factory(preserve_environ):
+    delete_quack_db()
+    try:
+        import duckdb
+
+        # Check if passing external duckdb connection works fine
+        db = duckdb.connect(":memory:")
+        dlt.pipeline(pipeline_name="booboo", destination=dlt.destinations.duckdb(db))
+
+        # Check if passing :memory: to factory fails
+        with pytest.raises(PipelineStepFailed) as exc:
+            p = dlt.pipeline(pipeline_name="booboo", destination="duckdb", credentials=":memory:")
+            p.run([1, 2, 3])
+
+        assert isinstance(exc.value.exception, InvalidInMemoryDuckdbCredentials)
+
+        os.environ["DESTINATION__DUCKDB__CREDENTIALS"] = ":memory:"
+        with pytest.raises(PipelineStepFailed):
+            p = dlt.pipeline(
+                pipeline_name="booboo",
+                destination="duckdb",
+            )
+            p.run([1, 2, 3])
+
+        assert isinstance(exc.value.exception, InvalidInMemoryDuckdbCredentials)
+
+        with pytest.raises(PipelineStepFailed) as exc:
+            p = dlt.pipeline(
+                pipeline_name="booboo",
+                destination=Destination.from_reference("duckdb", credentials=":memory:"),  # type: ignore[arg-type]
+            )
+            p.run([1, 2, 3], table_name="numbers")
+
+        assert isinstance(exc.value.exception, InvalidInMemoryDuckdbCredentials)
+    finally:
+        delete_quack_db()
+
+
 def test_duckdb_database_path() -> None:
     # resolve without any path provided
     c = resolve_configuration(
@@ -257,6 +296,7 @@ def test_external_duckdb_database() -> None:
     assert c.credentials._conn_owner is False
     assert hasattr(c.credentials, "_conn")
     conn.close()
+    assert not os.path.exists(":memory:")
 
 
 def test_default_duckdb_dataset_name() -> None: