We explored the impact of interfacial defects on the stability and optoelectronic properties of monolayer transition metal dichalcogenide lateral heterojunctions using a density functional theory approach. As a prototype, we focused on the MoS2–WSe2 system and found that even a random alloy-like interface with a width of less than 1 nm has only a minimal impact on the band gap and alignment compared to the defect-less interface. The largest impact is on the evolution of the electrostatic potential across the monolayer. Similar to defect-less interfaces, a small number of defects results in an electrostatic potential profile with a sharp change at the interface, which facilitates exciton dissociation. Differently, a large number of defects results in an electrostatic potential profile switching smoothly across the interface, which is expected to reduce the capability of the heterojunction to promote exciton dissociation. These results are generalizable to other transition metal dichalcogenide lateral heterojunctions.