diff --git a/flax/nnx/transforms/iteration.py b/flax/nnx/transforms/iteration.py
index 1ea33d78d5..09ed2a124c 100644
--- a/flax/nnx/transforms/iteration.py
+++ b/flax/nnx/transforms/iteration.py
@@ -1336,9 +1336,13 @@ def per_node_state(ns: extract.NodeStates | tp.Any):
     ):
       return ns
 
-    def per_node_def(nd: graph.NodeDef | tp.Any):
+    def per_node_def(nd: graph.NodeDef | graph.NodeRef):
       if nd.index >= 0:
         global_index_mapping[nd.index] = nd.index
+
+      if isinstance(nd, graph.NodeRef):
+        return
+
       for sub_nd in nd.subgraphs.values():
         per_node_def(sub_nd)
       for l in nd.leaves.values():
diff --git a/tests/nnx/transforms_test.py b/tests/nnx/transforms_test.py
index 4c327e1970..ad10a606ea 100644
--- a/tests/nnx/transforms_test.py
+++ b/tests/nnx/transforms_test.py
@@ -2934,6 +2934,40 @@ def fwd_fn(i, input):
     _, y = nnx.fori_loop(2, 4, fwd_fn, (module, x))
     np.testing.assert_array_equal(y, x * 2 * 3)
 
+  def test_fori_loop_with_sharing(self):
+    class A(nnx.Object):
+      def __init__(self):
+        self.params = nnx.Param(jnp.zeros((10,), dtype=int))
+
+    class B(nnx.Object):
+      def __init__(self, a: A):
+        self.a = a
+
+    class C(nnx.Object):
+      def __init__(self, a: A):
+        self.a = a
+
+    class D(nnx.Object):
+      def __init__(self):
+        self.a = A()
+        self.b = B(self.a)
+        self.c = C(self.a)
+
+    def increment(_, d: D) -> D:
+      d.a.params += 1
+      return d
+
+    @nnx.jit
+    def rollout(d: D):
+      nnx.fori_loop(0, 10, increment, d)
+
+    d = D()
+    rollout(d)
+
+    np.testing.assert_array_equal(
+      d.a.params.value, np.full((10,), 10, dtype=int)
+    )
+
 
 class TestSplitMergeInputs(absltest.TestCase):
   def test_split_inputs(self):