diff --git a/scripts/dts/python-devicetree/src/devicetree/edtlib.py b/scripts/dts/python-devicetree/src/devicetree/edtlib.py
index 8cf3c4b7dd035..036243a0bf6b4 100644
--- a/scripts/dts/python-devicetree/src/devicetree/edtlib.py
+++ b/scripts/dts/python-devicetree/src/devicetree/edtlib.py
@@ -2404,30 +2404,32 @@ def _process_properties_r(self, root_node: Node, props_node: Node) -> None:
         """
         # A Node depends on any Nodes present in 'phandle',
         # 'phandles', or 'phandle-array' property values.
+        #
+        # When a phandle target is a descendant of root_node, skip adding
+        # the dependency edge: the tree already has a child-parent edge
+        # for every child, so adding parent-child would create a cycle.
+        # The dependency is implicit because the parent already contains it.
+
+        def is_child_node(child_node):
+            while child_node is not None:
+                if root_node is child_node:
+                    return True
+                child_node = child_node.parent
+
+            return False
+
         for prop in props_node.props.values():
             if prop.type == 'phandle':
-                # According to the DT spec, a property named 'phy-handle' is required when
-                # the Ethernet device is connected a physical layer device (PHY).
-                # But the 'phy-handle' property can point to a child node of the Ethernet device,
-                # so we need to check for that and not add a dependency in that case, otherwise
-                # we'll get a cycle in the graph.
-                if prop.name == "phy-handle":
-                    def _is_child(parent_node: Node, child_node: Optional[Node]) -> bool:
-                        if child_node is None:
-                            return False
-                        if parent_node is child_node:
-                            return True
-                        return _is_child(parent_node, child_node.parent)
-                    if TYPE_CHECKING:
-                        assert isinstance(prop.val, Node)
-                    if _is_child(props_node, prop.val):
-                        continue
-                self._graph.add_edge(root_node, prop.val)
+                if TYPE_CHECKING:
+                    assert isinstance(prop.val, Node)
+                if not is_child_node(prop.val):
+                    self._graph.add_edge(root_node, prop.val)
             elif prop.type == 'phandles':
                 if TYPE_CHECKING:
                     assert isinstance(prop.val, list)
                 for phandle_node in prop.val:
-                    self._graph.add_edge(root_node, phandle_node)
+                    if not is_child_node(phandle_node):
+                        self._graph.add_edge(root_node, phandle_node)
             elif prop.type == 'phandle-array':
                 if TYPE_CHECKING:
                     assert isinstance(prop.val, list)
@@ -2436,7 +2438,8 @@ def _is_child(parent_node: Node, child_node: Optional[Node]) -> bool:
                         continue
                     if TYPE_CHECKING:
                         assert isinstance(cd, ControllerAndData)
-                    self._graph.add_edge(root_node, cd.controller)
+                    if not is_child_node(cd.controller):
+                        self._graph.add_edge(root_node, cd.controller)
 
         # A Node depends on whatever supports the interrupts it
         # generates.
diff --git a/scripts/dts/python-devicetree/tests/test_edtlib.py b/scripts/dts/python-devicetree/tests/test_edtlib.py
index d52bcf12c8775..93277687a1987 100644
--- a/scripts/dts/python-devicetree/tests/test_edtlib.py
+++ b/scripts/dts/python-devicetree/tests/test_edtlib.py
@@ -939,6 +939,68 @@ def test_child_dependencies():
     assert edt.get_node("/child-binding/child-1/grandchild") in dep_node.required_by
     assert edt.get_node("/child-binding/child-2") in dep_node.required_by
 
+def test_child_phandle_circular_dependency(tmp_path):
+    '''Test parent phandles to child states do not create dependency cycles.'''
+
+    binding_dir = tmp_path / "bindings"
+    binding_dir.mkdir()
+
+    binding_file = binding_dir / "test-stm.yaml"
+    binding_file.write_text("""
+description: Generic child state dependency test
+
+compatible: "test,stm"
+
+properties:
+  states:
+    type: phandles
+
+child-binding:
+  description: state node
+  properties:
+    next-state:
+      type: int
+""", encoding="utf-8")
+
+    dts_file = tmp_path / "child-descendant-ref.dts"
+    dts_file.write_text("""
+/dts-v1/;
+
+/ {
+	test_stm {
+		compatible = "test,stm";
+		states = <&state1 &state2 &state3>;
+
+		state1: state1 {
+			next-state = <2>;
+		};
+
+		state2: state2 {
+			next-state = <3>;
+		};
+
+		state3: state3 {
+			next-state = <1>;
+		};
+	};
+};
+""", encoding="utf-8")
+
+    edt = edtlib.EDT(os.fspath(dts_file), [os.fspath(binding_dir)])
+
+    parent = edt.get_node("/test_stm")
+    states = [
+        edt.get_node("/test_stm/state1"),
+        edt.get_node("/test_stm/state2"),
+        edt.get_node("/test_stm/state3"),
+    ]
+
+    assert parent.props["states"].val == states
+    for state in states:
+        assert parent not in state.required_by
+        assert state not in parent.depends_on
+        assert parent in state.depends_on
+
 def test_slice_errs(tmp_path):
     '''Test error messages from the internal _slice() helper'''