diff --git a/packages/@n8n/di/jest.config.js b/packages/@n8n/di/jest.config.js
index d6c48554a7..d14f2d60c6 100644
--- a/packages/@n8n/di/jest.config.js
+++ b/packages/@n8n/di/jest.config.js
@@ -1,2 +1,7 @@
 /** @type {import('jest').Config} */
-module.exports = require('../../../jest.config');
+module.exports = {
+	...require('../../../jest.config'),
+	transform: {
+		'^.+\\.ts$': ['ts-jest', { isolatedModules: false }],
+	},
+};
diff --git a/packages/@n8n/di/src/__tests__/circular-depedency.test.ts b/packages/@n8n/di/src/__tests__/circular-depedency.test.ts
new file mode 100644
index 0000000000..66bce38f7b
--- /dev/null
+++ b/packages/@n8n/di/src/__tests__/circular-depedency.test.ts
@@ -0,0 +1,17 @@
+import { ServiceA } from './fixtures/ServiceA';
+import { ServiceB } from './fixtures/ServiceB';
+import { Container } from '../di';
+
+describe('DI Container', () => {
+	describe('circular dependency', () => {
+		it('should detect multilevel circular dependencies', () => {
+			expect(() => Container.get(ServiceA)).toThrow(
+				'[DI] Circular dependency detected in ServiceB at index 0.\nServiceA -> ServiceB',
+			);
+
+			expect(() => Container.get(ServiceB)).toThrow(
+				'[DI] Circular dependency detected in ServiceB at index 0.\nServiceB',
+			);
+		});
+	});
+});
diff --git a/packages/@n8n/di/src/__tests__/fixtures/ServiceA.ts b/packages/@n8n/di/src/__tests__/fixtures/ServiceA.ts
new file mode 100644
index 0000000000..83f4c90430
--- /dev/null
+++ b/packages/@n8n/di/src/__tests__/fixtures/ServiceA.ts
@@ -0,0 +1,8 @@
+// eslint-disable-next-line import/no-cycle
+import { ServiceB } from './ServiceB';
+import { Service } from '../../di';
+
+@Service()
+export class ServiceA {
+	constructor(readonly b: ServiceB) {}
+}
diff --git a/packages/@n8n/di/src/__tests__/fixtures/ServiceB.ts b/packages/@n8n/di/src/__tests__/fixtures/ServiceB.ts
new file mode 100644
index 0000000000..a0dbd1908a
--- /dev/null
+++ b/packages/@n8n/di/src/__tests__/fixtures/ServiceB.ts
@@ -0,0 +1,8 @@
+// eslint-disable-next-line import/no-cycle
+import { ServiceA } from './ServiceA';
+import { Service } from '../../di';
+
+@Service()
+export class ServiceB {
+	constructor(readonly a: ServiceA) {}
+}
diff --git a/packages/@n8n/di/src/di.ts b/packages/@n8n/di/src/di.ts
index a4acb98474..08d86eae07 100644
--- a/packages/@n8n/di/src/di.ts
+++ b/packages/@n8n/di/src/di.ts
@@ -78,13 +78,6 @@ class ContainerClass {
 
 		if (metadata?.instance) return metadata.instance as T;
 
-		// Check for circular dependencies before proceeding with instantiation
-		if (resolutionStack.includes(type)) {
-			throw new DIError(
-				`Circular dependency detected. ${resolutionStack.map((t) => t.name).join(' -> ')}`,
-			);
-		}
-
 		// Add current type to resolution stack before resolving dependencies
 		resolutionStack.push(type);
 
@@ -96,9 +89,15 @@ class ContainerClass {
 			} else {
 				const paramTypes = (Reflect.getMetadata('design:paramtypes', type) ??
 					[]) as Constructable[];
-				const dependencies = paramTypes.map(<P>(paramType: Constructable<P>) =>
-					this.get(paramType),
-				);
+
+				const dependencies = paramTypes.map(<P>(paramType: Constructable<P>, index: number) => {
+					if (paramType === undefined) {
+						throw new DIError(
+							`Circular dependency detected in ${type.name} at index ${index}.\n${resolutionStack.map((t) => t.name).join(' -> ')}\n`,
+						);
+					}
+					return this.get(paramType);
+				});
 				// Create new instance with resolved dependencies
 				instance = new (type as Constructable)(...dependencies) as T;
 			}