Or you could create the temp table outside the proc, before calling the proc.

CREATE PROC TEST3

AS

-- Proc refers to a temp table that must exist prior to calling.

INSERT INTO #TEST3

SELECT 'InProcTest', 'InProcRow';

GO

-- Create the temp table ahead of time calling the proc

SELECT 'Original Test' AS Col1, 'Original Row' AS Col2

INTO #TEST3 ;

-- run the proc

EXEC TEST3;

-- Check results

SELECT * FROM #TEST3;