diff --git a/.changeset/unlucky-baboons-greet.md b/.changeset/unlucky-baboons-greet.md
new file mode 100644
index 0000000000..f720e64abf
--- /dev/null
+++ b/.changeset/unlucky-baboons-greet.md
@@ -0,0 +1,5 @@
+---
+'svelte': patch
+---
+
+fix: improve reconciliation of inert each block rows
diff --git a/packages/svelte/src/internal/client/dom/blocks/each.js b/packages/svelte/src/internal/client/dom/blocks/each.js
index 5753c7cb02..d09d2dac5c 100644
--- a/packages/svelte/src/internal/client/dom/blocks/each.js
+++ b/packages/svelte/src/internal/client/dom/blocks/each.js
@@ -373,7 +373,11 @@ function reconcile(array, state, anchor, render_fn, flags, get_key) {
 			stashed = [];
 
 			while (current !== null && current.k !== key) {
-				(seen ??= new Set()).add(current);
+				// If the item has an effect that is already inert, skip over adding it
+				// to our seen Set as the item is already being handled
+				if ((current.e.f & INERT) === 0) {
+					(seen ??= new Set()).add(current);
+				}
 				stashed.push(current);
 				current = current.next;
 			}
diff --git a/packages/svelte/tests/runtime-runes/samples/transition-each/_config.js b/packages/svelte/tests/runtime-runes/samples/transition-each/_config.js
new file mode 100644
index 0000000000..0dbd62e0ea
--- /dev/null
+++ b/packages/svelte/tests/runtime-runes/samples/transition-each/_config.js
@@ -0,0 +1,34 @@
+import { flushSync } from '../../../../src/index-client.js';
+import { test } from '../../test';
+
+export default test({
+	test({ assert, raf, target }) {
+		const [btn1, btn2] = target.querySelectorAll('button');
+
+		btn1?.click();
+		btn1?.click();
+		btn1?.click();
+		flushSync();
+		assert.htmlEqual(
+			target.innerHTML,
+			'<button>Push</button><button>Remove</button><ul><li>0</li><li>1</li><li>2</li></ul'
+		);
+
+		btn2?.click();
+		flushSync();
+		raf.tick(50);
+
+		const li = /** @type {HTMLElement & { foo: number }} */ (target.querySelector('ul > li'));
+
+		assert.equal(li.foo, 0.5);
+
+		btn1?.click();
+		flushSync();
+
+		assert.equal(li.foo, 0.5);
+		assert.htmlEqual(
+			target.innerHTML,
+			'<button>Push</button><button>Remove</button><ul><li>0</li><li>1</li><li>2</li><li>3</li></ul'
+		);
+	}
+});
diff --git a/packages/svelte/tests/runtime-runes/samples/transition-each/main.svelte b/packages/svelte/tests/runtime-runes/samples/transition-each/main.svelte
new file mode 100644
index 0000000000..8da2c8d561
--- /dev/null
+++ b/packages/svelte/tests/runtime-runes/samples/transition-each/main.svelte
@@ -0,0 +1,30 @@
+<script>
+	function foo(node, params) {
+		return {
+			duration: 100,
+			tick: (t, u) => {
+				node.foo = t;
+			}
+		};
+	}
+
+	let list = $state([]);
+	let id = 0;
+
+	function push() {
+		list.push({ id: id++ })
+	}
+
+	function removeFirst() {
+		list.splice(0, 1);
+	}
+</script>
+
+<button onclick={push}>Push</button>
+<button onclick={removeFirst}>Remove</button>
+
+<ul>
+	{#each list as item (item.id)}
+		<li out:foo>{item.id}</li>
+	{/each}
+</ul>