ANSWERED!

Since a local variable head is defined in the quoted expression, the recursive call to the function overwrites the value of head in the expanded expression. This isn't a problem when quoting in the tail of the list , because head was already used to build as its head. :mindblown:

Here's the final implementation of recurse/1:

def recurse([h|t]) do
  t = recurse(t)
  quote do
    [unquote(h)|unquote(t)]
  end
end

---

🤔

Output as seen in code provided:

» mix test test/recursive_macro_test.exs
[3]
[2, 3]
[1, 2, 3]
.

Finished in 0.04 seconds (0.04s on load, 0.00s on tests)
1 test, 0 failures

Randomized with seed 9300

Output with implemention changed as commented:

» mix test test/recursive_macro_test.exs
[3]
[3, 3]
[3, 3, 3]


  1) test recursive macro (RecursiveMacroTest)
     test/recursive_macro_test.exs:23
     Assertion with == failed
     code: recursive([1, 2, 3]) == [1, 2, 3]
     lhs:  [3, 3, 3]
     rhs:  [1, 2, 3]
     stacktrace:
       test/recursive_macro_test.exs:24



Finished in 0.04 seconds (0.04s on load, 0.00s on tests)
1 test, 1 failure

Randomized with seed 812630