diff --git a/.changeset/wild-parents-begin.md b/.changeset/wild-parents-begin.md
new file mode 100644
index 0000000000..ac98fa0e3e
--- /dev/null
+++ b/.changeset/wild-parents-begin.md
@@ -0,0 +1,5 @@
+---
+'svelte': patch
+---
+
+fix: ensure custom element attribute/prop changes are in their own context
diff --git a/packages/svelte/src/internal/client/dom/elements/attributes.js b/packages/svelte/src/internal/client/dom/elements/attributes.js
index 30c7712f1e..545cab20f8 100644
--- a/packages/svelte/src/internal/client/dom/elements/attributes.js
+++ b/packages/svelte/src/internal/client/dom/elements/attributes.js
@@ -7,6 +7,12 @@ import * as w from '../../warnings.js';
 import { LOADING_ATTR_SYMBOL } from '../../constants.js';
 import { queue_idle_task, queue_micro_task } from '../task.js';
 import { is_capture_event, is_delegated, normalize_attribute } from '../../../../utils.js';
+import {
+	active_effect,
+	active_reaction,
+	set_active_effect,
+	set_active_reaction
+} from '../../runtime.js';
 
 /**
  * The value/checked attribute in the template actually corresponds to the defaultValue property, so we need
@@ -145,10 +151,24 @@ export function set_xlink_attribute(dom, attribute, value) {
  * @param {any} value
  */
 export function set_custom_element_data(node, prop, value) {
-	if (get_setters(node).includes(prop)) {
-		node[prop] = value;
-	} else {
-		set_attribute(node, prop, value);
+	// We need to ensure that setting custom element props, which can
+	// invoke lifecycle methods on other custom elements, does not also
+	// associate those lifecycle methods with the current active reaction
+	// or effect
+	var previous_reaction = active_reaction;
+	var previous_effect = active_effect;
+
+	set_active_reaction(null);
+	set_active_effect(null);
+	try {
+		if (get_setters(node).includes(prop)) {
+			node[prop] = value;
+		} else {
+			set_attribute(node, prop, value);
+		}
+	} finally {
+		set_active_reaction(previous_reaction);
+		set_active_effect(previous_effect);
 	}
 }
 
diff --git a/packages/svelte/tests/runtime-browser/custom-elements-samples/element-effect-context/_config.js b/packages/svelte/tests/runtime-browser/custom-elements-samples/element-effect-context/_config.js
new file mode 100644
index 0000000000..3cf7a66df1
--- /dev/null
+++ b/packages/svelte/tests/runtime-browser/custom-elements-samples/element-effect-context/_config.js
@@ -0,0 +1,24 @@
+import { test } from '../../assert';
+const tick = () => Promise.resolve();
+
+export default test({
+	async test({ assert, target }) {
+		target.innerHTML = '<my-app/>';
+		await tick();
+		await tick();
+
+		/** @type {any} */
+		const el = target.querySelector('my-app');
+		const button = el.shadowRoot.querySelector('button');
+		const p = el.shadowRoot.querySelector('my-tracking').shadowRoot.querySelector('p');
+
+		assert.equal(button.innerHTML, '0');
+		assert.equal(p.innerHTML, 'false');
+
+		button.click();
+		await tick();
+
+		assert.equal(button.innerHTML, '1');
+		assert.equal(p.innerHTML, 'false');
+	}
+});
diff --git a/packages/svelte/tests/runtime-browser/custom-elements-samples/element-effect-context/main.svelte b/packages/svelte/tests/runtime-browser/custom-elements-samples/element-effect-context/main.svelte
new file mode 100644
index 0000000000..fa35c8a086
--- /dev/null
+++ b/packages/svelte/tests/runtime-browser/custom-elements-samples/element-effect-context/main.svelte
@@ -0,0 +1,31 @@
+<svelte:options customElement="my-app" />
+
+<script module>
+	class Tracking extends HTMLElement {
+		static observedAttributes = ["count"];
+        tracking = false;
+
+        set count(_) {
+            this.tracking = $effect.tracking();
+            this.render();
+        }
+
+        constructor() {
+            super();
+            this.attachShadow({ mode: 'open' });
+        }
+
+		render() {
+			this.shadowRoot.innerHTML = `<p>${this.tracking}</p>`;
+		}
+	}
+
+	customElements.define("my-tracking", Tracking);
+</script>
+
+<script>
+    let count = $state(0);
+</script>
+
+<button onclick={() => (count += 1)}>{count}</button>
+<my-tracking {count}></my-tracking>