diff --git a/packages/react-dom/src/__tests__/ReactDOMServerSelectiveHydration-test.internal.js b/packages/react-dom/src/__tests__/ReactDOMServerSelectiveHydration-test.internal.js
index ca94bc3bc1e0b..02d1dff1a9ec6 100644
--- a/packages/react-dom/src/__tests__/ReactDOMServerSelectiveHydration-test.internal.js
+++ b/packages/react-dom/src/__tests__/ReactDOMServerSelectiveHydration-test.internal.js
@@ -14,6 +14,7 @@ import {createEventTarget} from 'dom-event-testing-library';
 let React;
 let ReactDOM;
 let ReactDOMServer;
+let ReactTestUtils;
 let Scheduler;
 let Suspense;
 let usePress;
@@ -102,6 +103,7 @@ describe('ReactDOMServerSelectiveHydration', () => {
     React = require('react');
     ReactDOM = require('react-dom');
     ReactDOMServer = require('react-dom/server');
+    ReactTestUtils = require('react-dom/test-utils');
     Scheduler = require('scheduler');
     Suspense = React.Suspense;
     usePress = require('react-interactions/events/press').usePress;
@@ -585,7 +587,7 @@ describe('ReactDOMServerSelectiveHydration', () => {
     document.body.removeChild(container);
   });
 
-  it('hydrates the last target as higher priority for continuous events', async () => {
+  it('hydrates the hovered targets as higher priority for continuous events', async () => {
     let suspend = false;
     let resolve;
     let promise = new Promise(resolvePromise => (resolve = resolvePromise));
@@ -669,21 +671,107 @@ describe('ReactDOMServerSelectiveHydration', () => {
 
     // We should prioritize hydrating D first because we clicked it.
     // Next we should hydrate C since that's the current hover target.
-    // Next it doesn't matter if we hydrate A or B first but as an
-    // implementation detail we're currently hydrating B first since
-    // we at one point hovered over it and we never deprioritized it.
+    // To simplify implementation details we hydrate both B and C at
+    // the same time since B was already scheduled.
+    // This is ok because it will at least not continue for nested
+    // boundary. See the next test below.
     expect(Scheduler).toFlushAndYield([
       'D',
       'Clicked D',
+      'B', // Ideally this should be later.
       'C',
       'Hover C',
-      'B',
       'A',
     ]);
 
     document.body.removeChild(container);
   });
 
+  it('hydrates the last target path first for continuous events', async () => {
+    let suspend = false;
+    let resolve;
+    let promise = new Promise(resolvePromise => (resolve = resolvePromise));
+
+    function Child({text}) {
+      if ((text === 'A' || text === 'D') && suspend) {
+        throw promise;
+      }
+      Scheduler.unstable_yieldValue(text);
+      return (
+        <span
+          onMouseEnter={e => {
+            e.preventDefault();
+            Scheduler.unstable_yieldValue('Hover ' + text);
+          }}>
+          {text}
+        </span>
+      );
+    }
+
+    function App() {
+      Scheduler.unstable_yieldValue('App');
+      return (
+        <div>
+          <Suspense fallback="Loading...">
+            <Child text="A" />
+          </Suspense>
+          <Suspense fallback="Loading...">
+            <div>
+              <Suspense fallback="Loading...">
+                <Child text="B" />
+              </Suspense>
+            </div>
+            <Child text="C" />
+          </Suspense>
+          <Suspense fallback="Loading...">
+            <Child text="D" />
+          </Suspense>
+        </div>
+      );
+    }
+
+    let finalHTML = ReactDOMServer.renderToString(<App />);
+
+    expect(Scheduler).toHaveYielded(['App', 'A', 'B', 'C', 'D']);
+
+    let container = document.createElement('div');
+    // We need this to be in the document since we'll dispatch events on it.
+    document.body.appendChild(container);
+
+    container.innerHTML = finalHTML;
+
+    let spanB = container.getElementsByTagName('span')[1];
+    let spanC = container.getElementsByTagName('span')[2];
+    let spanD = container.getElementsByTagName('span')[3];
+
+    suspend = true;
+
+    // A and D will be suspended. We'll click on D which should take
+    // priority, after we unsuspend.
+    let root = ReactDOM.createRoot(container, {hydrate: true});
+    root.render(<App />);
+
+    // Nothing has been hydrated so far.
+    expect(Scheduler).toHaveYielded([]);
+
+    // Hover over B and then C.
+    dispatchMouseHoverEvent(spanB, spanD);
+    dispatchMouseHoverEvent(spanC, spanB);
+
+    suspend = false;
+    resolve();
+    await promise;
+
+    // We should prioritize hydrating D first because we clicked it.
+    // Next we should hydrate C since that's the current hover target.
+    // Next it doesn't matter if we hydrate A or B first but as an
+    // implementation detail we're currently hydrating B first since
+    // we at one point hovered over it and we never deprioritized it.
+    expect(Scheduler).toFlushAndYield(['App', 'C', 'Hover C', 'A', 'B', 'D']);
+
+    document.body.removeChild(container);
+  });
+
   it('hydrates the last explicitly hydrated target at higher priority', async () => {
     function Child({text}) {
       Scheduler.unstable_yieldValue(text);
@@ -731,4 +819,110 @@ describe('ReactDOMServerSelectiveHydration', () => {
     // gets highest priority followed by the next added.
     expect(Scheduler).toFlushAndYield(['App', 'C', 'B', 'A']);
   });
+
+  it('hydrates before an update even if hydration moves away from it', async () => {
+    function Child({text}) {
+      Scheduler.unstable_yieldValue(text);
+      return <span>{text}</span>;
+    }
+    let ChildWithBoundary = React.memo(function({text}) {
+      return (
+        <Suspense fallback="Loading...">
+          <Child text={text} />
+          <Child text={text.toLowerCase()} />
+        </Suspense>
+      );
+    });
+
+    function App({a}) {
+      Scheduler.unstable_yieldValue('App');
+      React.useEffect(() => {
+        Scheduler.unstable_yieldValue('Commit');
+      });
+      return (
+        <div>
+          <ChildWithBoundary text={a} />
+          <ChildWithBoundary text="B" />
+          <ChildWithBoundary text="C" />
+        </div>
+      );
+    }
+
+    let finalHTML = ReactDOMServer.renderToString(<App a="A" />);
+
+    expect(Scheduler).toHaveYielded(['App', 'A', 'a', 'B', 'b', 'C', 'c']);
+
+    let container = document.createElement('div');
+    container.innerHTML = finalHTML;
+
+    // We need this to be in the document since we'll dispatch events on it.
+    document.body.appendChild(container);
+
+    let spanA = container.getElementsByTagName('span')[0];
+    let spanB = container.getElementsByTagName('span')[2];
+    let spanC = container.getElementsByTagName('span')[4];
+
+    let root = ReactDOM.createRoot(container, {hydrate: true});
+    ReactTestUtils.act(() => {
+      root.render(<App a="A" />);
+
+      // Hydrate the shell.
+      expect(Scheduler).toFlushAndYieldThrough(['App', 'Commit']);
+
+      // Render an update at Idle priority that needs to update A.
+      Scheduler.unstable_runWithPriority(
+        Scheduler.unstable_IdlePriority,
+        () => {
+          root.render(<App a="AA" />);
+        },
+      );
+
+      // Start rendering. This will force the first boundary to hydrate
+      // by scheduling it at one higher pri than Idle.
+      expect(Scheduler).toFlushAndYieldThrough(['App', 'A']);
+
+      // Hover over A which (could) schedule at one higher pri than Idle.
+      dispatchMouseHoverEvent(spanA, null);
+
+      // Before, we're done we now switch to hover over B.
+      // This is meant to test that this doesn't cause us to forget that
+      // we still have to hydrate A. The first boundary.
+      // This also tests that we don't do the -1 down-prioritization of
+      // continuous hover events because that would decrease its priority
+      // to Idle.
+      dispatchMouseHoverEvent(spanB, spanA);
+
+      // Also click C to prioritize that even higher which resets the
+      // priority levels.
+      dispatchClickEvent(spanC);
+
+      expect(Scheduler).toHaveYielded([
+        // Hydrate C first since we clicked it.
+        'C',
+        'c',
+      ]);
+
+      expect(Scheduler).toFlushAndYield([
+        // Finish hydration of A since we forced it to hydrate.
+        'A',
+        'a',
+        // Also, hydrate B since we hovered over it.
+        // It's not important which one comes first. A or B.
+        // As long as they both happen before the Idle update.
+        'B',
+        'b',
+        // Begin the Idle update again.
+        'App',
+        'AA',
+        'aa',
+        'Commit',
+      ]);
+    });
+
+    let spanA2 = container.getElementsByTagName('span')[0];
+    // This is supposed to have been hydrated, not replaced.
+    expect(spanA).toBe(spanA2);
+
+    document.body.removeChild(container);
+  });
 });
diff --git a/packages/react-reconciler/src/ReactFiberExpirationTime.js b/packages/react-reconciler/src/ReactFiberExpirationTime.js
index 5f4660dd5175f..72d58dff4eb9f 100644
--- a/packages/react-reconciler/src/ReactFiberExpirationTime.js
+++ b/packages/react-reconciler/src/ReactFiberExpirationTime.js
@@ -32,10 +32,9 @@ export const Never = 1;
 // Idle is slightly higher priority than Never. It must completely finish in
 // order to be consistent.
 export const Idle = 2;
-// Continuous Hydration is a moving priority. It is slightly higher than Idle
-// and is used to increase priority of hover targets. It is increasing with
-// each usage so that last always wins.
-let ContinuousHydration = 3;
+// Continuous Hydration is slightly higher than Idle and is used to increase
+// priority of hover targets.
+export const ContinuousHydration = 3;
 export const Sync = MAX_SIGNED_31_BIT_INT;
 export const Batched = Sync - 1;
 
@@ -119,15 +118,6 @@ export function computeInteractiveExpiration(currentTime: ExpirationTime) {
   );
 }
 
-export function computeContinuousHydrationExpiration(
-  currentTime: ExpirationTime,
-) {
-  // Each time we ask for a new one of these we increase the priority.
-  // This ensures that the last one always wins since we can't deprioritize
-  // once we've scheduled work already.
-  return ContinuousHydration++;
-}
-
 export function inferPriorityFromExpirationTime(
   currentTime: ExpirationTime,
   expirationTime: ExpirationTime,
diff --git a/packages/react-reconciler/src/ReactFiberReconciler.js b/packages/react-reconciler/src/ReactFiberReconciler.js
index fb46524645aee..8a91ea9b4c25c 100644
--- a/packages/react-reconciler/src/ReactFiberReconciler.js
+++ b/packages/react-reconciler/src/ReactFiberReconciler.js
@@ -76,8 +76,8 @@ import {
 import {StrictMode} from './ReactTypeOfMode';
 import {
   Sync,
+  ContinuousHydration,
   computeInteractiveExpiration,
-  computeContinuousHydrationExpiration,
 } from './ReactFiberExpirationTime';
 import {requestCurrentSuspenseConfig} from './ReactFiberSuspenseConfig';
 import {
@@ -384,11 +384,8 @@ export function attemptContinuousHydration(fiber: Fiber): void {
     // Suspense.
     return;
   }
-  let expTime = computeContinuousHydrationExpiration(
-    requestCurrentTimeForUpdate(),
-  );
-  scheduleWork(fiber, expTime);
-  markRetryTimeIfNotHydrated(fiber, expTime);
+  scheduleWork(fiber, ContinuousHydration);
+  markRetryTimeIfNotHydrated(fiber, ContinuousHydration);
 }
 
 export function attemptHydrationAtCurrentPriority(fiber: Fiber): void {