diff --git a/src/internal/packager2/layout/create.go b/src/internal/packager2/layout/create.go
index 960e4a70e2..237d48cce3 100644
--- a/src/internal/packager2/layout/create.go
+++ b/src/internal/packager2/layout/create.go
@@ -271,7 +271,7 @@ func LoadPackage(ctx context.Context, packagePath, flavor string, setVariables m
 		return v1alpha1.ZarfPackage{}, err
 	}
 	pkg.Metadata.Architecture = config.GetArch(pkg.Metadata.Architecture)
-	pkg, err = resolveImports(ctx, pkg, packagePath, pkg.Metadata.Architecture, flavor, map[string]interface{}{})
+	pkg, err = resolveImports(ctx, pkg, packagePath, pkg.Metadata.Architecture, flavor, []string{})
 	if err != nil {
 		return v1alpha1.ZarfPackage{}, err
 	}
diff --git a/src/internal/packager2/layout/import.go b/src/internal/packager2/layout/import.go
index af7d2ad7a4..c3f613984a 100644
--- a/src/internal/packager2/layout/import.go
+++ b/src/internal/packager2/layout/import.go
@@ -7,7 +7,6 @@ import (
 	"context"
 	"errors"
 	"fmt"
-	"maps"
 	"os"
 	"path/filepath"
 	"slices"
@@ -24,7 +23,9 @@ import (
 	"github.com/zarf-dev/zarf/src/pkg/zoci"
 )
 
-func resolveImports(ctx context.Context, pkg v1alpha1.ZarfPackage, packagePath, arch, flavor string, seenImports map[string]interface{}) (v1alpha1.ZarfPackage, error) {
+func resolveImports(ctx context.Context, pkg v1alpha1.ZarfPackage, packagePath, arch, flavor string, importStack []string) (v1alpha1.ZarfPackage, error) {
+	importStack = append(importStack, packagePath)
+
 	variables := pkg.Variables
 	constants := pkg.Constants
 	components := []v1alpha1.ZarfComponent{}
@@ -47,12 +48,11 @@ func resolveImports(ctx context.Context, pkg v1alpha1.ZarfPackage, packagePath,
 		var importedPkg v1alpha1.ZarfPackage
 		if component.Import.Path != "" {
 			importPath := filepath.Join(packagePath, component.Import.Path)
-			importKey := fmt.Sprintf("%s-%s", component.Name, importPath)
-			if _, ok := seenImports[importKey]; ok {
-				return v1alpha1.ZarfPackage{}, fmt.Errorf("package %s imported in cycle by %s in component %s", filepath.ToSlash(importPath), filepath.ToSlash(packagePath), component.Name)
+			for _, sp := range importStack {
+				if sp == importPath {
+					return v1alpha1.ZarfPackage{}, fmt.Errorf("package %s imported in cycle by %s in component %s", filepath.ToSlash(importPath), filepath.ToSlash(packagePath), component.Name)
+				}
 			}
-			seenImports = maps.Clone(seenImports)
-			seenImports[importKey] = nil
 			b, err := os.ReadFile(filepath.Join(importPath, layout.ZarfYAML))
 			if err != nil {
 				return v1alpha1.ZarfPackage{}, err
@@ -61,7 +61,7 @@ func resolveImports(ctx context.Context, pkg v1alpha1.ZarfPackage, packagePath,
 			if err != nil {
 				return v1alpha1.ZarfPackage{}, err
 			}
-			importedPkg, err = resolveImports(ctx, importedPkg, importPath, arch, flavor, seenImports)
+			importedPkg, err = resolveImports(ctx, importedPkg, importPath, arch, flavor, importStack)
 			if err != nil {
 				return v1alpha1.ZarfPackage{}, err
 			}
@@ -91,7 +91,7 @@ func resolveImports(ctx context.Context, pkg v1alpha1.ZarfPackage, packagePath,
 			}
 		}
 		if len(found) == 0 {
-			return v1alpha1.ZarfPackage{}, fmt.Errorf("component %s not found", name)
+			return v1alpha1.ZarfPackage{}, fmt.Errorf("no compatible component named %s found", name)
 		} else if len(found) > 1 {
 			return v1alpha1.ZarfPackage{}, fmt.Errorf("multiple components named %s found", name)
 		}
@@ -122,7 +122,7 @@ func resolveImports(ctx context.Context, pkg v1alpha1.ZarfPackage, packagePath,
 	pkg.Constants = slices.CompactFunc(constants, func(l, r v1alpha1.Constant) bool {
 		return l.Name == r.Name
 	})
-
+	importStack = importStack[0:len(importStack)-1]
 	return pkg, nil
 }
 
diff --git a/src/internal/packager2/layout/import_test.go b/src/internal/packager2/layout/import_test.go
index 04d84a6d6b..4e45b7d4eb 100644
--- a/src/internal/packager2/layout/import_test.go
+++ b/src/internal/packager2/layout/import_test.go
@@ -23,13 +23,35 @@ func TestResolveImportsCircular(t *testing.T) {
 
 	lint.ZarfSchema = testutil.LoadSchema(t, "../../../../zarf.schema.json")
 
-	b, err := os.ReadFile(filepath.Join("./testdata/import/first", ZarfYAML))
+	b, err := os.ReadFile(filepath.Join("./testdata/import/circular/first", ZarfYAML))
 	require.NoError(t, err)
 	pkg, err := ParseZarfPackage(b)
 	require.NoError(t, err)
 
-	_, err = resolveImports(ctx, pkg, "./testdata/import/first", "", "", map[string]interface{}{})
-	require.EqualError(t, err, "package testdata/import/second imported in cycle by testdata/import/third in component component")
+	_, err = resolveImports(ctx, pkg, "./testdata/import/circular/first", "", "", []string{})
+	require.EqualError(t, err, "package testdata/import/circular/second imported in cycle by testdata/import/circular/third in component component")
+}
+
+func TestResolveImportsBranches(t *testing.T) {
+	t.Parallel()
+	ctx := testutil.TestContext(t)
+	lint.ZarfSchema = testutil.LoadSchema(t, "../../../../zarf.schema.json")
+
+	// Get the parent package
+	b, err := os.ReadFile(filepath.Join("./testdata/import/branch", ZarfYAML))
+	require.NoError(t, err)
+	pkg, err := ParseZarfPackage(b)
+	require.NoError(t, err)
+
+	resolvedPkg, err := resolveImports(ctx, pkg, "./testdata/import/branch", "", "", []string{})
+	require.NoError(t, err)
+
+	// ensure imports were resolved correctly
+	b, err = os.ReadFile(filepath.Join("./testdata/import/branch", "expected.yaml"))
+	require.NoError(t, err)
+	expectedPkg, err := ParseZarfPackage(b)
+	require.NoError(t, err)
+	require.Equal(t, expectedPkg, resolvedPkg)
 }
 
 func TestValidateComponentCompose(t *testing.T) {
diff --git a/src/internal/packager2/layout/testdata/import/branch/child/zarf.yaml b/src/internal/packager2/layout/testdata/import/branch/child/zarf.yaml
new file mode 100644
index 0000000000..99d53d5a9f
--- /dev/null
+++ b/src/internal/packager2/layout/testdata/import/branch/child/zarf.yaml
@@ -0,0 +1,12 @@
+kind: ZarfPackageConfig
+metadata:
+  name: example-child
+
+components:
+  - name: common
+    import:
+      path: ../common
+
+  - name: parent-child-common
+    import:
+      path: ../common
diff --git a/src/internal/packager2/layout/testdata/import/branch/common/zarf.yaml b/src/internal/packager2/layout/testdata/import/branch/common/zarf.yaml
new file mode 100644
index 0000000000..1dfdc71f09
--- /dev/null
+++ b/src/internal/packager2/layout/testdata/import/branch/common/zarf.yaml
@@ -0,0 +1,10 @@
+kind: ZarfPackageConfig
+metadata:
+  name: example-shared
+
+components:
+  - name: common
+    description: This gets imported by the parent and child directly
+
+  - name: parent-child-common
+    description: This gets imported in a chain parent->child->common
diff --git a/src/internal/packager2/layout/testdata/import/branch/expected.yaml b/src/internal/packager2/layout/testdata/import/branch/expected.yaml
new file mode 100644
index 0000000000..d69881517f
--- /dev/null
+++ b/src/internal/packager2/layout/testdata/import/branch/expected.yaml
@@ -0,0 +1,10 @@
+kind: ZarfPackageConfig
+metadata:
+  name: example-package
+components:
+- name: common
+  description: This gets imported by the parent and child directly
+  required: true
+- name: parent-child-common
+  description: This gets imported in a chain parent->child->common
+  required: true
diff --git a/src/internal/packager2/layout/testdata/import/branch/zarf.yaml b/src/internal/packager2/layout/testdata/import/branch/zarf.yaml
new file mode 100644
index 0000000000..ae930a1f78
--- /dev/null
+++ b/src/internal/packager2/layout/testdata/import/branch/zarf.yaml
@@ -0,0 +1,14 @@
+kind: ZarfPackageConfig
+metadata:
+  name: example-package
+
+components:
+  - name: common
+    required: true
+    import:
+      path: common
+
+  - name: parent-child-common
+    required: true
+    import:
+      path: child
diff --git a/src/internal/packager2/layout/testdata/import/first/zarf.yaml b/src/internal/packager2/layout/testdata/import/circular/first/zarf.yaml
similarity index 100%
rename from src/internal/packager2/layout/testdata/import/first/zarf.yaml
rename to src/internal/packager2/layout/testdata/import/circular/first/zarf.yaml
diff --git a/src/internal/packager2/layout/testdata/import/second/zarf.yaml b/src/internal/packager2/layout/testdata/import/circular/second/zarf.yaml
similarity index 100%
rename from src/internal/packager2/layout/testdata/import/second/zarf.yaml
rename to src/internal/packager2/layout/testdata/import/circular/second/zarf.yaml
diff --git a/src/internal/packager2/layout/testdata/import/third/zarf.yaml b/src/internal/packager2/layout/testdata/import/circular/third/zarf.yaml
similarity index 100%
rename from src/internal/packager2/layout/testdata/import/third/zarf.yaml
rename to src/internal/packager2/layout/testdata/import/circular/third/zarf.yaml