diff --git a/example/src/App.tsx b/example/src/App.tsx
index 925aae4..f0b5996 100644
--- a/example/src/App.tsx
+++ b/example/src/App.tsx
@@ -9,7 +9,7 @@ import { SafeAreaProvider } from 'react-native-safe-area-context';
 
 import { UserProvider } from './context/UserContext';
 import { HomeScreen } from './screens';
-import { ScannerSheet } from './sheets';
+import { PersistentWithPortalSheet, ScannerSheet } from './sheets';
 import { sharedStyles } from './styles/theme';
 
 export default function App() {
@@ -30,6 +30,10 @@ export default function App() {
           <BottomSheetPersistent id="scanner-sheet">
             <ScannerSheet />
           </BottomSheetPersistent>
+          {/* Persistent sheet with nested portal sheet inside */}
+          <BottomSheetPersistent id="persistent-with-portal">
+            <PersistentWithPortalSheet />
+          </BottomSheetPersistent>
         </BottomSheetManagerProvider>
       </GestureHandlerRootView>
     </SafeAreaProvider>
diff --git a/example/src/bottom-sheet.d.ts b/example/src/bottom-sheet.d.ts
index ef2dc84..2bcd64e 100644
--- a/example/src/bottom-sheet.d.ts
+++ b/example/src/bottom-sheet.d.ts
@@ -11,5 +11,9 @@ declare module 'react-native-bottom-sheet-stack' {
       source: 'home' | 'navigation';
       title?: string;
     };
+    'persistent-with-portal': true;
+    'nested-portal-in-persistent': {
+      message: string;
+    };
   }
 }
diff --git a/example/src/screens/HomeScreen.tsx b/example/src/screens/HomeScreen.tsx
index 5f84839..6826e94 100644
--- a/example/src/screens/HomeScreen.tsx
+++ b/example/src/screens/HomeScreen.tsx
@@ -24,6 +24,9 @@ export function HomeScreen() {
   const portalSheetControl = useBottomSheetControl('context-portal-sheet');
   const portalModeSheetA = useBottomSheetControl('portal-mode-sheet-a');
   const scannerControl = useBottomSheetControl('scanner-sheet');
+  const persistentWithPortalControl = useBottomSheetControl(
+    'persistent-with-portal'
+  );
 
   return (
     <View style={sharedStyles.container}>
@@ -125,6 +128,15 @@ export function HomeScreen() {
               })
             }
           />
+
+          <DemoCard
+            title="Persistent + Nested Portal"
+            description="Persistent sheet with portal-based sheet defined inside"
+            color={colors.purple}
+            onPress={() =>
+              persistentWithPortalControl.open({ scaleBackground: true })
+            }
+          />
         </View>
 
         {/* Features */}
diff --git a/example/src/sheets/PersistentWithNestedPortal.tsx b/example/src/sheets/PersistentWithNestedPortal.tsx
new file mode 100644
index 0000000..0db4f47
--- /dev/null
+++ b/example/src/sheets/PersistentWithNestedPortal.tsx
@@ -0,0 +1,212 @@
+import type { BottomSheetMethods } from '@gorhom/bottom-sheet/lib/typescript/types';
+import { forwardRef, useState } from 'react';
+import { StyleSheet, Text, View } from 'react-native';
+import {
+  BottomSheetPortal,
+  useBottomSheetContext,
+  useBottomSheetControl,
+} from 'react-native-bottom-sheet-stack';
+
+import { Badge, Button, SecondaryButton, Sheet } from '../components';
+import { colors, sharedStyles } from '../styles/theme';
+
+/**
+ * Nested portal sheet content - defined inside the persistent sheet
+ * to demonstrate portal sheets can be declared within other sheets
+ */
+const NestedPortalSheetContent = forwardRef<BottomSheetMethods>((_, ref) => {
+  const { close, params } =
+    useBottomSheetContext<'nested-portal-in-persistent'>();
+  const [counter, setCounter] = useState(0);
+
+  return (
+    <Sheet ref={ref} enableDynamicSizing>
+      <View style={styles.badgeRow}>
+        <Badge label="Portal" color={colors.warning} />
+        <Badge label="Nested" color={colors.purple} />
+      </View>
+      <Text style={sharedStyles.h1}>Nested Portal Sheet</Text>
+      <Text style={sharedStyles.text}>
+        This portal-based sheet is defined inside the persistent sheet. It has
+        access to the same React context as its parent.
+      </Text>
+
+      {params?.message && (
+        <View style={styles.paramBox}>
+          <Text style={styles.paramLabel}>Message from parent:</Text>
+          <Text style={styles.paramValue}>{params.message}</Text>
+        </View>
+      )}
+
+      <View style={styles.counterBox}>
+        <Text style={styles.counterLabel}>Local counter:</Text>
+        <Text style={styles.counterValue}>{counter}</Text>
+      </View>
+
+      <View style={styles.actions}>
+        <Button
+          title="Increment Counter"
+          onPress={() => setCounter((c) => c + 1)}
+        />
+        <SecondaryButton title="Close" onPress={close} />
+      </View>
+
+      <View style={styles.infoBox}>
+        <Text style={styles.infoText}>
+          Note: This sheet's state resets on close because it's a portal sheet
+          (not persistent). The parent persistent sheet keeps its state.
+        </Text>
+      </View>
+    </Sheet>
+  );
+});
+
+NestedPortalSheetContent.displayName = 'NestedPortalSheetContent';
+
+/**
+ * Persistent sheet that contains a portal-based sheet definition inside
+ */
+export const PersistentWithPortalSheet = forwardRef<BottomSheetMethods>(
+  (_, ref) => {
+    const { close } = useBottomSheetContext<'persistent-with-portal'>();
+    const nestedPortalControl = useBottomSheetControl(
+      'nested-portal-in-persistent'
+    );
+    const [openCount, setOpenCount] = useState(0);
+
+    const handleOpenNestedPortal = () => {
+      setOpenCount((c) => c + 1);
+      nestedPortalControl.open({
+        scaleBackground: true,
+        mode: 'push',
+        params: {
+          message: `Opened ${openCount + 1} time(s) from persistent sheet`,
+        },
+      });
+    };
+
+    return (
+      <>
+        {/* Portal sheet defined inside the persistent sheet */}
+        <BottomSheetPortal id="nested-portal-in-persistent">
+          <NestedPortalSheetContent />
+        </BottomSheetPortal>
+
+        <Sheet ref={ref} enableDynamicSizing>
+          <View style={styles.badgeRow}>
+            <Badge label="Persistent" color={colors.cyan} />
+            <Badge label="Has Nested Portal" color={colors.purple} />
+          </View>
+          <Text style={sharedStyles.h1}>Persistent + Portal Demo</Text>
+          <Text style={sharedStyles.text}>
+            This persistent sheet contains a portal-based sheet definition
+            inside. The persistent sheet keeps its state across open/close
+            cycles, while the nested portal sheet resets.
+          </Text>
+
+          <View style={styles.stateBox}>
+            <Text style={styles.stateLabel}>Nested portal opened:</Text>
+            <Text style={styles.stateValue}>{openCount} time(s)</Text>
+          </View>
+
+          <View style={styles.actions}>
+            <Button
+              title="Open Nested Portal Sheet"
+              onPress={handleOpenNestedPortal}
+            />
+            <SecondaryButton title="Close" onPress={close} />
+          </View>
+
+          <View style={styles.infoBox}>
+            <Text style={styles.infoText}>
+              Close this sheet and reopen it - the "opened count" persists
+              because this is a persistent sheet. The nested portal sheet's
+              counter will reset each time it opens.
+            </Text>
+          </View>
+        </Sheet>
+      </>
+    );
+  }
+);
+
+PersistentWithPortalSheet.displayName = 'PersistentWithPortalSheet';
+
+const styles = StyleSheet.create({
+  badgeRow: {
+    flexDirection: 'row',
+    gap: 8,
+  },
+  actions: {
+    gap: 12,
+    marginTop: 16,
+  },
+  paramBox: {
+    backgroundColor: colors.primaryDark,
+    borderRadius: 12,
+    padding: 14,
+    marginTop: 16,
+  },
+  paramLabel: {
+    color: colors.textSecondary,
+    fontSize: 12,
+    marginBottom: 4,
+  },
+  paramValue: {
+    color: colors.primary,
+    fontSize: 16,
+    fontWeight: '600',
+  },
+  counterBox: {
+    backgroundColor: colors.background,
+    borderRadius: 12,
+    padding: 14,
+    marginTop: 12,
+    flexDirection: 'row',
+    justifyContent: 'space-between',
+    alignItems: 'center',
+  },
+  counterLabel: {
+    color: colors.textSecondary,
+    fontSize: 14,
+  },
+  counterValue: {
+    color: colors.warning,
+    fontSize: 24,
+    fontWeight: '700',
+  },
+  stateBox: {
+    backgroundColor: colors.background,
+    borderRadius: 12,
+    padding: 14,
+    marginTop: 16,
+    flexDirection: 'row',
+    justifyContent: 'space-between',
+    alignItems: 'center',
+    borderWidth: 1,
+    borderColor: colors.border,
+  },
+  stateLabel: {
+    color: colors.textSecondary,
+    fontSize: 14,
+  },
+  stateValue: {
+    color: colors.cyan,
+    fontSize: 20,
+    fontWeight: '700',
+  },
+  infoBox: {
+    backgroundColor: colors.background,
+    borderRadius: 12,
+    padding: 14,
+    marginTop: 16,
+    borderWidth: 1,
+    borderColor: colors.border,
+  },
+  infoText: {
+    color: colors.textSecondary,
+    fontSize: 13,
+    lineHeight: 18,
+    textAlign: 'center',
+  },
+});
diff --git a/example/src/sheets/index.ts b/example/src/sheets/index.ts
index 1ef9cd0..af88f3c 100644
--- a/example/src/sheets/index.ts
+++ b/example/src/sheets/index.ts
@@ -7,5 +7,6 @@ export {
 export { HeavySheet } from './DynamicContentSheet';
 export { SheetA, SheetB, SheetC, SheetD } from './NavigationSheets';
 export { NestedSheet1, NestedSheet2, NestedSheet3 } from './NestedScaleSheets';
+export { PersistentWithPortalSheet } from './PersistentWithNestedPortal';
 export { PortalModeSheetA, PortalModeSheetB } from './PortalModeSheets';
 export { ScannerSheet } from './ScannerSheet';
diff --git a/src/BottomSheetPersistent.tsx b/src/BottomSheetPersistent.tsx
index 39d257b..36b93b5 100644
--- a/src/BottomSheetPersistent.tsx
+++ b/src/BottomSheetPersistent.tsx
@@ -1,14 +1,20 @@
 import type { BottomSheetMethods } from '@gorhom/bottom-sheet/lib/typescript/types';
 import React, { useEffect, useRef } from 'react';
 
-import { useMount, useSheetExists, useUnmount } from './bottomSheet.store';
+import {
+  useMount,
+  useSheetExists,
+  useSheetPortalSession,
+  useUnmount,
+} from './bottomSheet.store';
 import { BottomSheetDefaultIndexContext } from './BottomSheetDefaultIndex.context';
 import { useMaybeBottomSheetManagerContext } from './BottomSheetManager.provider';
-import { BottomSheetPortal } from './BottomSheetPortal';
 import { BottomSheetRefContext } from './BottomSheetRef.context';
 import type { BottomSheetPortalId } from './portal.types';
 import { setSheetRef } from './refsMap';
 import { useEvent } from './useEvent';
+import { Portal } from 'react-native-teleport';
+import { BottomSheetContext } from './BottomSheet.context';
 
 interface BottomSheetPersistentProps {
   id: BottomSheetPortalId;
@@ -23,7 +29,7 @@ export function BottomSheetPersistent({
   const mount = useMount();
   const unmount = useUnmount();
   const sheetExists = useSheetExists(id);
-
+  const portalSession = useSheetPortalSession(id);
   const sheetRef = useRef<BottomSheetMethods>(null);
   const groupId = bottomSheetManagerContext?.groupId || 'default';
 
@@ -49,12 +55,14 @@ export function BottomSheetPersistent({
   }
 
   return (
-    <BottomSheetPortal id={id}>
-      <BottomSheetDefaultIndexContext.Provider value={{ defaultIndex: -1 }}>
-        <BottomSheetRefContext.Provider value={sheetRef}>
-          {children}
-        </BottomSheetRefContext.Provider>
-      </BottomSheetDefaultIndexContext.Provider>
-    </BottomSheetPortal>
+    <Portal hostName={`bottomsheet-${id}-${portalSession}`}>
+      <BottomSheetContext.Provider value={{ id }}>
+        <BottomSheetDefaultIndexContext.Provider value={{ defaultIndex: -1 }}>
+          <BottomSheetRefContext.Provider value={sheetRef}>
+            {children}
+          </BottomSheetRefContext.Provider>
+        </BottomSheetDefaultIndexContext.Provider>
+      </BottomSheetContext.Provider>
+    </Portal>
   );
 }
diff --git a/src/BottomSheetPortal.tsx b/src/BottomSheetPortal.tsx
index f768397..abc7998 100644
--- a/src/BottomSheetPortal.tsx
+++ b/src/BottomSheetPortal.tsx
@@ -4,7 +4,9 @@ import React from 'react';
 import { Portal } from 'react-native-teleport';
 
 import { BottomSheetContext } from './BottomSheet.context';
-import { useSheetUsePortal, useSheetPortalSession } from './bottomSheet.store';
+import { BottomSheetDefaultIndexContext } from './BottomSheetDefaultIndex.context';
+import { BottomSheetRefContext } from './BottomSheetRef.context';
+import { useSheetPortalSession } from './bottomSheet.store';
 import type { BottomSheetPortalId } from './portal.types';
 import { getSheetRef } from './refsMap';
 
@@ -14,22 +16,21 @@ interface BottomSheetPortalProps {
 }
 
 export function BottomSheetPortal({ id, children }: BottomSheetPortalProps) {
-  const usePortal = useSheetUsePortal(id);
   const portalSession = useSheetPortalSession(id);
+  const ref = getSheetRef(id);
 
-  if (!usePortal || portalSession === undefined) {
+  if (!portalSession || !ref) {
     return null;
   }
 
-  const ref = getSheetRef(id);
-  const childWithRef = React.cloneElement(children, {
-    ref,
-  } as { ref: typeof ref });
-
   return (
     <Portal hostName={`bottomsheet-${id}-${portalSession}`}>
       <BottomSheetContext.Provider value={{ id }}>
-        {childWithRef}
+        <BottomSheetDefaultIndexContext.Provider value={{ defaultIndex: 0 }}>
+          <BottomSheetRefContext.Provider value={ref}>
+            {children}
+          </BottomSheetRefContext.Provider>
+        </BottomSheetDefaultIndexContext.Provider>
       </BottomSheetContext.Provider>
     </Portal>
   );