diff --git a/.changeset/wild-tools-dress.md b/.changeset/wild-tools-dress.md
new file mode 100644
index 0000000000..ad00320746
--- /dev/null
+++ b/.changeset/wild-tools-dress.md
@@ -0,0 +1,5 @@
+---
+'@sumup-oss/circuit-ui': patch
+---
+
+Increased the SidePanel component's root z-index value to ensure nested, absolutely-positioned components stack properly.
diff --git a/packages/circuit-ui/components/SidePanel/components/DesktopSidePanel/DesktopSidePanel.tsx b/packages/circuit-ui/components/SidePanel/components/DesktopSidePanel/DesktopSidePanel.tsx
index 5d8a227768..da551c1323 100644
--- a/packages/circuit-ui/components/SidePanel/components/DesktopSidePanel/DesktopSidePanel.tsx
+++ b/packages/circuit-ui/components/SidePanel/components/DesktopSidePanel/DesktopSidePanel.tsx
@@ -43,7 +43,7 @@ export function DesktopSidePanel({
   };
 
   return (
-    <StackContext.Provider value={'var(--cui-z-index-absolute)'}>
+    <StackContext.Provider value={'var(--cui-z-index-navigation)'}>
       <ReactModal {...reactModalProps}>{children}</ReactModal>
     </StackContext.Provider>
   );