Dynamic Picklist not submitting selected choice on add

I set up a dynamic picklist and the options available in field 2 depend on what I selected in field 1. The problem occurs once I hit submit. In the corresponding report, the option I selected in field 2 is not recorded. The record displays all other entries except the selection from the dynamic picklist (field 2).

This problem occurs even if I try to add a new record from the report. The only way I've been able to get the option to stick is if I edit the record once I add it.

Any ideas on what the issue might be?