diff --git a/public/app/features/dashboard-scene/scene/layout-auto-grid/AutoGridItemRenderer.tsx b/public/app/features/dashboard-scene/scene/layout-auto-grid/AutoGridItemRenderer.tsx
index 28fd18768d2..ee7fd012add 100644
--- a/public/app/features/dashboard-scene/scene/layout-auto-grid/AutoGridItemRenderer.tsx
+++ b/public/app/features/dashboard-scene/scene/layout-auto-grid/AutoGridItemRenderer.tsx
@@ -130,6 +130,12 @@ const getStyles = (theme: GrafanaTheme2) => ({
     width: `var(${DRAGGED_ITEM_WIDTH})`,
     height: `var(${DRAGGED_ITEM_HEIGHT})`,
     opacity: 0.8,
+
+    // Unfortunately, we need to re-enforce the absolute position here. Otherwise, the position will be overwritten with
+    //  a relative position by .dashboard-visible-hidden-element
+    '&.dashboard-visible-hidden-element': {
+      position: 'absolute',
+    },
   }),
   draggedRepeatWrapper: css({
     visibility: 'hidden',
diff --git a/public/app/features/dashboard-scene/scene/layout-auto-grid/AutoGridLayout.tsx b/public/app/features/dashboard-scene/scene/layout-auto-grid/AutoGridLayout.tsx
index 7e8570a3eec..61d1c679854 100644
--- a/public/app/features/dashboard-scene/scene/layout-auto-grid/AutoGridLayout.tsx
+++ b/public/app/features/dashboard-scene/scene/layout-auto-grid/AutoGridLayout.tsx
@@ -65,6 +65,7 @@ export class AutoGridLayout extends SceneObjectBase<AutoGridLayoutState> impleme
     top: number;
     left: number;
   } | null = null;
+  private _lastDropTargetGridItemKey: string | null = null;
 
   public constructor(state: Partial<AutoGridLayoutState>) {
     super({
@@ -145,6 +146,7 @@ export class AutoGridLayout extends SceneObjectBase<AutoGridLayoutState> impleme
     }
 
     this._draggedGridItem = gridItem;
+    this._lastDropTargetGridItemKey = gridItem.state.key!;
 
     const { top, left, width, height } = this._draggedGridItem.getBoundingBox();
     this._initialGridItemPosition = { pageX: evt.pageX, pageY: evt.pageY, top, left: left };
@@ -166,6 +168,7 @@ export class AutoGridLayout extends SceneObjectBase<AutoGridLayoutState> impleme
 
     this._draggedGridItem = null;
     this._initialGridItemPosition = null;
+    this._lastDropTargetGridItemKey = null;
     this._resetPanelPositionAndSize();
 
     this.setState({ draggingKey: undefined });
@@ -196,7 +199,7 @@ export class AutoGridLayout extends SceneObjectBase<AutoGridLayoutState> impleme
       })
       ?.getAttribute('data-auto-grid-item-drop-target');
 
-    if (dropTargetGridItemKey) {
+    if (dropTargetGridItemKey && dropTargetGridItemKey !== this._lastDropTargetGridItemKey) {
       this._onDragOverItem(dropTargetGridItemKey);
     }
   }
@@ -207,12 +210,14 @@ export class AutoGridLayout extends SceneObjectBase<AutoGridLayoutState> impleme
     const draggedIdx = children.findIndex((child) => child === this._draggedGridItem);
     const draggedOverIdx = children.findIndex((child) => child.state.key === key);
 
-    if (draggedIdx === -1 || draggedOverIdx === -1) {
+    if (draggedIdx === -1 || draggedOverIdx === -1 || draggedIdx === draggedOverIdx) {
+      this._lastDropTargetGridItemKey = key;
       return;
     }
 
     children.splice(draggedIdx, 1);
     children.splice(draggedOverIdx, 0, this._draggedGridItem!);
+    this._lastDropTargetGridItemKey = this._draggedGridItem!.state.key!;
 
     this.setState({ children });
   }