diff --git a/src/cdk/drag-drop/directives/drop-list.ts b/src/cdk/drag-drop/directives/drop-list.ts
index 8ff7eb3654fb..aeb0b42e7c3e 100644
--- a/src/cdk/drag-drop/directives/drop-list.ts
+++ b/src/cdk/drag-drop/directives/drop-list.ts
@@ -363,6 +363,10 @@ export class CdkDropList<T = any> implements OnDestroy {
 
   /** Handles events from the underlying DropListRef. */
   private _handleEvents(ref: DropListRef<CdkDropList>) {
+    merge(ref.receivingStarted, ref.receivingStopped)
+      .pipe(takeUntil(this._destroyed))
+      .subscribe(() => this._changeDetectorRef.markForCheck());
+
     ref.beforeStarted.subscribe(() => {
       this._syncItemsWithRef(this.getSortedItems().map(item => item._dragRef));
       this._changeDetectorRef.markForCheck();
diff --git a/src/cdk/drag-drop/drop-list-ref.ts b/src/cdk/drag-drop/drop-list-ref.ts
index 000b3c188691..0b0bd16cf0e0 100644
--- a/src/cdk/drag-drop/drop-list-ref.ts
+++ b/src/cdk/drag-drop/drop-list-ref.ts
@@ -211,6 +211,12 @@ export class DropListRef<T = any> {
   /** Direction of the list's layout. */
   private _direction: Direction = 'ltr';
 
+  /**
+   * Cache of all connected lists (including self) ordered by DOM hierarchy — outer containers
+   * first, inner containers last. Invalidated whenever siblings change.
+   */
+  private _cachedSortedSiblings: DropListRef[] | null = null;
+
   constructor(
     element: ElementRef<HTMLElement> | HTMLElement,
     private _dragDropRegistry: DragDropRegistry,
@@ -240,6 +246,7 @@ export class DropListRef<T = any> {
     this._activeSiblings.clear();
     this._scrollNode = null!;
     this._parentPositions.clear();
+    this._cachedSortedSiblings = null;
     this._dragDropRegistry.removeDropContainer(this);
   }
 
@@ -368,6 +375,8 @@ export class DropListRef<T = any> {
    */
   connectedTo(connectedTo: DropListRef[]): this {
     this._siblings = connectedTo.slice();
+    // Invalidate the hierarchy cache since siblings have changed.
+    this._cachedSortedSiblings = null;
     return this;
   }
 
@@ -443,6 +452,8 @@ export class DropListRef<T = any> {
     }
 
     this._cachedShadowRoot = null;
+    // Invalidate the hierarchy cache since the DOM structure may have changed.
+    this._cachedSortedSiblings = null;
     this._scrollableElements.unshift(container);
     this._container = container;
     return this;
@@ -687,7 +698,101 @@ export class DropListRef<T = any> {
    * @param y Position of the item along the Y axis.
    */
   _getSiblingContainerFromPosition(item: DragRef, x: number, y: number): DropListRef | undefined {
-    return this._siblings.find(sibling => sibling._canReceive(item, x, y));
+    // Possible targets include siblings and 'this'.
+    const targets = [this, ...this._siblings];
+
+    // Only consider targets where the drag position is within the client rect
+    // (this avoids calling enterPredicate on each possible target).
+    const matchingTargets = targets.filter(
+      ref => ref._domRect && isInsideClientRect(ref._domRect, x, y),
+    );
+
+    // Stop if no targets match the coordinates.
+    if (matchingTargets.length === 0) {
+      return undefined;
+    }
+
+    // Use the cached hierarchy order, computing it only when siblings have changed.
+    // This avoids rebuilding the DOM tree on every pointermove event.
+    if (!this._cachedSortedSiblings) {
+      this._cachedSortedSiblings = this._orderByHierarchy([this, ...this._siblings]);
+    }
+
+    // Filter the pre-ordered list to retain only the matching targets,
+    // preserving the hierarchy order without re-sorting.
+    const orderedMatchingTargets = this._cachedSortedSiblings.filter(ref =>
+      matchingTargets.includes(ref),
+    );
+
+    // The drop target is the last matching target in the ordered list,
+    // i.e. the innermost container in the DOM hierarchy.
+    const matchingTarget = orderedMatchingTargets[orderedMatchingTargets.length - 1];
+
+    // Only return the matching target if it is a sibling, not 'this'.
+    if (matchingTarget === this) {
+      return undefined;
+    }
+
+    // Can the matching target receive the item?
+    if (!matchingTarget._canReceive(item, x, y)) {
+      return undefined;
+    }
+
+    return matchingTarget;
+  }
+
+  /**
+   * Sorts a list of DropListRefs such that for every nested pair of drop containers,
+   * the outer drop container appears before the inner drop container.
+   * @param refs List of DropListRefs to sort.
+   */
+  private _orderByHierarchy(refs: DropListRef[]): DropListRef[] {
+    // Build a map from HTMLElement to DropListRef for fast ancestor lookup.
+    const refsByElement = new Map<HTMLElement, DropListRef>();
+    refs.forEach(ref => refsByElement.set(ref._container, ref));
+
+    // Finds the closest ancestor DropListRef of a given ref, if any.
+    const findAncestor = (ref: DropListRef): DropListRef | undefined => {
+      let ancestor = ref._container.parentElement;
+      while (ancestor) {
+        if (refsByElement.has(ancestor)) {
+          return refsByElement.get(ancestor);
+        }
+        ancestor = ancestor.parentElement;
+      }
+      return undefined;
+    };
+
+    // Node type for the tree structure.
+    type NodeType = {ref: DropListRef; parent?: NodeType; children: NodeType[]};
+
+    // Create a tree node for each ref.
+    const tree = new Map<DropListRef, NodeType>();
+    refs.forEach(ref => tree.set(ref, {ref, children: []}));
+
+    // Build parent-child relationships.
+    refs.forEach(ref => {
+      const parent = findAncestor(ref);
+      if (parent) {
+        const node = tree.get(ref)!;
+        const parentNode = tree.get(parent)!;
+        node.parent = parentNode;
+        parentNode.children.push(node);
+      }
+    });
+
+    // Find root nodes (those without a parent among the refs).
+    const roots = Array.from(tree.values()).filter(node => !node.parent);
+
+    // Recursively build the ordered list: parent before children.
+    const buildOrderedList = (nodes: NodeType[], list: DropListRef[]) => {
+      list.push(...nodes.map(node => node.ref));
+      nodes.forEach(node => buildOrderedList(node.children, list));
+    };
+
+    const ordered: DropListRef[] = [];
+    buildOrderedList(roots, ordered);
+    return ordered;
   }
 
   /**
@@ -863,7 +968,7 @@ function getElementScrollDirections(
 
   // Note that we here we do some extra checks for whether the element is actually scrollable in
   // a certain direction and we only assign the scroll direction if it is. We do this so that we
-  // can allow other elements to be scrolled, if the current element can't be scrolled anymore.
+  // can allow other elements to be scrolled, if the current element can't be scrollated anymore.
   // This allows us to handle cases where the scroll regions of two scrollable elements overlap.
   if (computedVertical) {
     const scrollTop = element.scrollTop;
diff --git a/src/dev-app/drag-drop/drag-drop-demo.html b/src/dev-app/drag-drop/drag-drop-demo.html
index 104101ae2496..ee3488b48664 100644
--- a/src/dev-app/drag-drop/drag-drop-demo.html
+++ b/src/dev-app/drag-drop/drag-drop-demo.html
@@ -1,3 +1,44 @@
+<div cdkDropListGroup>
+  <div class="demo-list">
+    <h2>To do</h2>
+
+    <div
+      cdkDropList
+      [cdkDropListData]="todo2"
+      (cdkDropListDropped)="drop($event)"
+      [cdkDropListConnectedTo]="dls"
+    >
+      @for (item of todo2; track item) {
+        <div class="example-box" cdkDrag>
+          @if (isArray(item)) {
+            <div class="demo-list">
+              <div
+                cdkDropList
+                [cdkDropListData]="item"
+                class="example-list"
+                (cdkDropListDropped)="drop($event)"
+                [cdkDropListConnectedTo]="dls"
+              >
+                @for (innerItem of item; track innerItem) {
+                  <div class="example-box" cdkDrag>
+                    {{innerItem}}
+                    <mat-icon cdkDragHandle svgIcon="dnd-move"></mat-icon>
+                  </div>
+                }
+              </div>
+            </div>
+          } @else {
+            <div>
+              {{item}}
+              <mat-icon cdkDragHandle svgIcon="dnd-move"></mat-icon>
+            </div>
+          }
+        </div>
+      }
+    </div>
+  </div>
+</div>
+
 <div cdkDropListGroup>
   <div class="demo-list">
     <h2>To do</h2>
@@ -5,7 +46,8 @@ <h2>To do</h2>
       cdkDropList
       (cdkDropListDropped)="drop($event)"
       [cdkDropListLockAxis]="axisLock"
-      [cdkDropListData]="todo">
+      [cdkDropListData]="todo"
+    >
       @for (item of todo; track item) {
         <div cdkDrag>
           {{item}}
@@ -21,10 +63,11 @@ <h2>Done</h2>
       cdkDropList
       (cdkDropListDropped)="drop($event)"
       [cdkDropListLockAxis]="axisLock"
-      [cdkDropListData]="done">
+      [cdkDropListData]="done"
+    >
       @for (item of done; track item) {
         <div cdkDrag>
-          {{item}}
+          {{ item }}
           <mat-icon cdkDragHandle svgIcon="dnd-move"></mat-icon>
         </div>
       }
@@ -40,10 +83,11 @@ <h2>Ages</h2>
       cdkDropListOrientation="horizontal"
       (cdkDropListDropped)="drop($event)"
       [cdkDropListLockAxis]="axisLock"
-      [cdkDropListData]="ages">
+      [cdkDropListData]="ages"
+    >
       @for (item of ages; track item) {
         <div cdkDrag>
-          {{item}}
+          {{ item }}
           <mat-icon cdkDragHandle svgIcon="dnd-move"></mat-icon>
         </div>
       }
@@ -57,10 +101,11 @@ <h2>Preferred Ages</h2>
       cdkDropListOrientation="horizontal"
       (cdkDropListDropped)="drop($event)"
       [cdkDropListLockAxis]="axisLock"
-      [cdkDropListData]="preferredAges">
+      [cdkDropListData]="preferredAges"
+    >
       @for (item of preferredAges; track item) {
         <div cdkDrag>
-          {{item}}
+          {{ item }}
           <mat-icon cdkDragHandle svgIcon="dnd-move"></mat-icon>
         </div>
       }
@@ -78,16 +123,18 @@ <h2>Mixed orientation</h2>
   <div
     class="demo-list"
     [class.demo-list-wrapping]="mixedWrap"
-    [class.demo-list-horizontal]="mixedWrap">
+    [class.demo-list-horizontal]="mixedWrap"
+  >
     <div
       cdkDropList
       cdkDropListOrientation="mixed"
       (cdkDropListDropped)="drop($event)"
       [cdkDropListLockAxis]="axisLock"
-      [cdkDropListData]="mixedTodo">
+      [cdkDropListData]="mixedTodo"
+    >
       @for (item of mixedTodo; track item) {
         <div cdkDrag>
-          {{item}}
+          {{ item }}
           <mat-icon cdkDragHandle svgIcon="dnd-move"></mat-icon>
         </div>
       }
@@ -97,16 +144,18 @@ <h2>Mixed orientation</h2>
   <div
     class="demo-list"
     [class.demo-list-wrapping]="mixedWrap"
-    [class.demo-list-horizontal]="mixedWrap">
+    [class.demo-list-horizontal]="mixedWrap"
+  >
     <div
       cdkDropList
       cdkDropListOrientation="mixed"
       (cdkDropListDropped)="drop($event)"
       [cdkDropListLockAxis]="axisLock"
-      [cdkDropListData]="mixedDone">
+      [cdkDropListData]="mixedDone"
+    >
       @for (item of mixedDone; track item) {
         <div cdkDrag>
-          {{item}}
+          {{ item }}
           <mat-icon cdkDragHandle svgIcon="dnd-move"></mat-icon>
         </div>
       }
@@ -159,10 +208,10 @@ <h2>Drag with box boundary and custom constrain</h2>
 
 <div>
   <h2>Data</h2>
-  <pre>{{todo.join(', ')}}</pre>
-  <pre>{{done.join(', ')}}</pre>
-  <pre>{{ages.join(', ')}}</pre>
-  <pre>{{preferredAges.join(', ')}}</pre>
+  <pre>{{ todo.join(', ') }}</pre>
+  <pre>{{ done.join(', ') }}</pre>
+  <pre>{{ ages.join(', ') }}</pre>
+  <pre>{{ preferredAges.join(', ') }}</pre>
 </div>
 
 <div>
diff --git a/src/dev-app/drag-drop/drag-drop-demo.ts b/src/dev-app/drag-drop/drag-drop-demo.ts
index d4bd63ea6601..421eedc19e64 100644
--- a/src/dev-app/drag-drop/drag-drop-demo.ts
+++ b/src/dev-app/drag-drop/drag-drop-demo.ts
@@ -6,16 +6,24 @@
  * found in the LICENSE file at https://angular.dev/license
  */
 
-import {Component, ViewEncapsulation, ChangeDetectionStrategy, inject} from '@angular/core';
+import {
+  Component,
+  ViewEncapsulation,
+  ChangeDetectionStrategy,
+  inject,
+  QueryList,
+  AfterViewInit,
+  ViewChildren,
+} from '@angular/core';
 import {MatIconModule, MatIconRegistry} from '@angular/material/icon';
 import {DomSanitizer} from '@angular/platform-browser';
 import {
-  CdkDragDrop,
   DragDropModule,
   moveItemInArray,
   transferArrayItem,
   Point,
   DragRef,
+  CdkDropList,
 } from '@angular/cdk/drag-drop';
 import {FormsModule} from '@angular/forms';
 import {MatFormFieldModule} from '@angular/material/form-field';
@@ -39,7 +47,7 @@ import {MatCheckbox} from '@angular/material/checkbox';
     MatCheckbox,
   ],
 })
-export class DragAndDropDemo {
+export class DragAndDropDemo implements AfterViewInit {
   axisLock!: 'x' | 'y';
   dragStartDelay = 0;
   todo = ['Go out for Lunch', 'Make a cool app', 'Watch TV', 'Eat a healthy dinner', 'Go to sleep'];
@@ -50,6 +58,17 @@ export class DragAndDropDemo {
 
   ages = ['Stone age', 'Bronze age', 'Iron age', 'Middle ages'];
   preferredAges = ['Modern period', 'Renaissance'];
+  dls: CdkDropList[] = [];
+
+  todo2 = [
+    'Get to work',
+    ['Get up', 'Brush teeth', 'Take a shower', 'Check e-mail', 'Walk dog'],
+    ['Preare for work', 'Drive to office', 'Üark car'],
+    'Pick up groceries',
+    'Go home',
+    'Fall asleep',
+  ];
+  @ViewChildren(CdkDropList) dlq: QueryList<CdkDropList> | undefined;
 
   constructor() {
     const iconRegistry = inject(MatIconRegistry);
@@ -69,7 +88,21 @@ export class DragAndDropDemo {
     );
   }
 
-  drop(event: CdkDragDrop<string[]>) {
+  ngAfterViewInit() {
+    const updateList = () => {
+      const ldls: CdkDropList[] = [];
+      this.dlq?.forEach(dl => ldls.push(dl));
+      queueMicrotask(() => {
+        this.dls = ldls;
+      });
+    };
+
+    updateList();
+    this.dlq?.changes.subscribe(() => updateList());
+  }
+
+  // CdkDragDrop<string[]>
+  drop(event: any) {
     if (event.previousContainer === event.container) {
       moveItemInArray(event.container.data, event.previousIndex, event.currentIndex);
     } else {
@@ -88,4 +121,8 @@ export class DragAndDropDemo {
     y -= pickup.y;
     return {x, y};
   }
+
+  isArray(item: any): boolean {
+    return Array.isArray(item);
+  }
 }