diff --git a/CHANGELOG.md b/CHANGELOG.md
index 0df0de8cee..b0df94c037 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -66,6 +66,8 @@ END_UNRELEASED_TEMPLATE
 ### Fixed
 * (tests) No more coverage warnings are being printed if there are no sources.
   ([#2762](https://github.com/bazel-contrib/rules_python/issues/2762))
+* (gazelle) Ancestor `conftest.py` files are added in addition to sibling `conftest.py`.
+  ([#3497](https://github.com/bazel-contrib/rules_python/issues/3497))
 
 {#v0-0-0-added}
 ### Added
diff --git a/gazelle/python/generate.go b/gazelle/python/generate.go
index cbceea4693..49e9921fa9 100644
--- a/gazelle/python/generate.go
+++ b/gazelle/python/generate.go
@@ -66,6 +66,24 @@ func matchesAnyGlob(s string, globs []string) bool {
 	return false
 }
 
+// findConftestPaths returns package paths containing conftest.py, from currentPkg
+// up through ancestors, stopping at pythonProjectRoot (or repo root if empty).
+func findConftestPaths(repoRoot, currentPkg, pythonProjectRoot string) []string {
+	var result []string
+	for pkg := currentPkg; ; pkg = filepath.Dir(pkg) {
+		if pkg == "." {
+			pkg = ""
+		}
+		if _, err := os.Stat(filepath.Join(repoRoot, pkg, conftestFilename)); err == nil {
+			result = append(result, pkg)
+		}
+		if pkg == "" || pkg == pythonProjectRoot {
+			break
+		}
+	}
+	return result
+}
+
 // GenerateRules extracts build metadata from source files in a directory.
 // GenerateRules is called in each directory where an update is requested
 // in depth-first post-order.
@@ -481,14 +499,15 @@ func (py *Python) GenerateRules(args language.GenerateArgs) language.GenerateRes
 	}
 
 	for _, pyTestTarget := range pyTestTargets {
-		if conftest != nil {
-			conftestModule := Module{Name: importSpecFromSrc(pythonProjectRoot, args.Rel, conftestFilename).Imp}
-			if pyTestTarget.annotations.includePytestConftest == nil {
-				// unset; default behavior
-				pyTestTarget.addModuleDependency(conftestModule)
-			} else if *pyTestTarget.annotations.includePytestConftest {
-				// set; add if true, do not add if false
-				pyTestTarget.addModuleDependency(conftestModule)
+		shouldAddConftest := pyTestTarget.annotations.includePytestConftest == nil ||
+		*pyTestTarget.annotations.includePytestConftest
+
+		if shouldAddConftest {
+			for _, conftestPkg := range findConftestPaths(args.Config.RepoRoot, args.Rel, pythonProjectRoot) {
+				conftestModule := Module{
+					Name: importSpecFromSrc(pythonProjectRoot, conftestPkg, conftestFilename).Imp,
+				}
+				pyTestTarget.deps.Add(conftestModule)
 			}
 		}
 		pyTest := pyTestTarget.build()
diff --git a/gazelle/python/testdata/simple_test_with_conftest/bar/BUILD.out b/gazelle/python/testdata/simple_test_with_conftest/bar/BUILD.out
index 4a1204e989..9b500d4733 100644
--- a/gazelle/python/testdata/simple_test_with_conftest/bar/BUILD.out
+++ b/gazelle/python/testdata/simple_test_with_conftest/bar/BUILD.out
@@ -23,5 +23,6 @@ py_test(
     deps = [
         ":bar",
         ":conftest",
+        "//:conftest",
     ],
 )
diff --git a/gazelle/python/testdata/simple_test_with_conftest_sibling_imports_disabled/bar/BUILD.out b/gazelle/python/testdata/simple_test_with_conftest_sibling_imports_disabled/bar/BUILD.out
index ef8591f199..25a2d39672 100644
--- a/gazelle/python/testdata/simple_test_with_conftest_sibling_imports_disabled/bar/BUILD.out
+++ b/gazelle/python/testdata/simple_test_with_conftest_sibling_imports_disabled/bar/BUILD.out
@@ -22,6 +22,7 @@ py_test(
     main = "__test__.py",
     deps = [
         ":conftest",
+        "//:conftest",
         "//:simple_test_with_conftest_sibling_imports_disabled",
     ],
 )