diff --git a/tests/CMakeLists.txt b/tests/CMakeLists.txt
index a6ac3a0d7..b79e755e4 100644
--- a/tests/CMakeLists.txt
+++ b/tests/CMakeLists.txt
@@ -125,6 +125,7 @@ set(PYBIND11_TEST_FILES
     test_class_sh_factory_constructors
     test_class_sh_inheritance
     test_class_sh_mi_thunks
+    test_class_sh_module_local.py
     test_class_sh_property
     test_class_sh_property_non_owning
     test_class_sh_shared_ptr_copy_move
@@ -238,6 +239,8 @@ tests_extra_targets("test_exceptions.py;test_local_bindings.py;test_stl.py;test_
 # And add additional targets for other tests.
 tests_extra_targets("test_exceptions.py" "cross_module_interleaved_error_already_set")
 tests_extra_targets("test_gil_scoped.py" "cross_module_gil_utils")
+tests_extra_targets("test_class_sh_module_local.py"
+                    "class_sh_module_local_0;class_sh_module_local_1;class_sh_module_local_2")
 
 set(PYBIND11_EIGEN_REPO
     "https://gitlab.com/libeigen/eigen.git"
diff --git a/tests/class_sh_module_local_0.cpp b/tests/class_sh_module_local_0.cpp
new file mode 100644
index 000000000..bb1f46d5c
--- /dev/null
+++ b/tests/class_sh_module_local_0.cpp
@@ -0,0 +1,27 @@
+#include <pybind11/smart_holder.h>
+
+#include <string>
+
+namespace pybind11_tests {
+namespace class_sh_module_local {
+
+struct atyp { // Short for "any type".
+    std::string mtxt;
+};
+
+std::string get_mtxt(const atyp &obj) { return obj.mtxt; }
+
+atyp rtrn_valu_atyp() { return atyp(); }
+
+} // namespace class_sh_module_local
+} // namespace pybind11_tests
+
+PYBIND11_SMART_HOLDER_TYPE_CASTERS(pybind11_tests::class_sh_module_local::atyp)
+
+PYBIND11_MODULE(class_sh_module_local_0, m) {
+    using namespace pybind11_tests::class_sh_module_local;
+
+    m.def("get_mtxt", get_mtxt);
+
+    m.def("rtrn_valu_atyp", rtrn_valu_atyp);
+}
diff --git a/tests/class_sh_module_local_1.cpp b/tests/class_sh_module_local_1.cpp
new file mode 100644
index 000000000..66bc95516
--- /dev/null
+++ b/tests/class_sh_module_local_1.cpp
@@ -0,0 +1,33 @@
+// Identical to class_sh_module_local_2.cpp, except 2 replaced with 1.
+#include <pybind11/smart_holder.h>
+
+#include <string>
+
+namespace pybind11_tests {
+namespace class_sh_module_local {
+
+struct atyp { // Short for "any type".
+    std::string mtxt;
+};
+
+std::string get_mtxt(const atyp &obj) { return obj.mtxt; }
+
+} // namespace class_sh_module_local
+} // namespace pybind11_tests
+
+PYBIND11_SMART_HOLDER_TYPE_CASTERS(pybind11_tests::class_sh_module_local::atyp)
+
+PYBIND11_MODULE(class_sh_module_local_1, m) {
+    namespace py = pybind11;
+    using namespace pybind11_tests::class_sh_module_local;
+
+    py::classh<atyp>(m, "atyp", py::module_local())
+        .def(py::init([](const std::string &mtxt) {
+            atyp obj;
+            obj.mtxt = mtxt;
+            return obj;
+        }))
+        .def("tag", [](const atyp &) { return 1; });
+
+    m.def("get_mtxt", get_mtxt);
+}
diff --git a/tests/class_sh_module_local_2.cpp b/tests/class_sh_module_local_2.cpp
new file mode 100644
index 000000000..bef105aad
--- /dev/null
+++ b/tests/class_sh_module_local_2.cpp
@@ -0,0 +1,33 @@
+// Identical to class_sh_module_local_1.cpp, except 1 replaced with 2.
+#include <pybind11/smart_holder.h>
+
+#include <string>
+
+namespace pybind11_tests {
+namespace class_sh_module_local {
+
+struct atyp { // Short for "any type".
+    std::string mtxt;
+};
+
+std::string get_mtxt(const atyp &obj) { return obj.mtxt; }
+
+} // namespace class_sh_module_local
+} // namespace pybind11_tests
+
+PYBIND11_SMART_HOLDER_TYPE_CASTERS(pybind11_tests::class_sh_module_local::atyp)
+
+PYBIND11_MODULE(class_sh_module_local_2, m) {
+    namespace py = pybind11;
+    using namespace pybind11_tests::class_sh_module_local;
+
+    py::classh<atyp>(m, "atyp", py::module_local())
+        .def(py::init([](const std::string &mtxt) {
+            atyp obj;
+            obj.mtxt = mtxt;
+            return obj;
+        }))
+        .def("tag", [](const atyp &) { return 2; });
+
+    m.def("get_mtxt", get_mtxt);
+}
diff --git a/tests/test_class_sh_module_local.py b/tests/test_class_sh_module_local.py
new file mode 100644
index 000000000..e504152a1
--- /dev/null
+++ b/tests/test_class_sh_module_local.py
@@ -0,0 +1,27 @@
+from __future__ import annotations
+
+import class_sh_module_local_0 as m0
+import class_sh_module_local_1 as m1
+import class_sh_module_local_2 as m2
+import pytest
+
+
+def test_cross_module_get_mtxt():
+    obj1 = m1.atyp("A")
+    assert obj1.tag() == 1
+    obj2 = m2.atyp("B")
+    assert obj2.tag() == 2
+    assert m1.get_mtxt(obj1) == "A"
+    assert m2.get_mtxt(obj2) == "B"
+    assert m1.get_mtxt(obj2) == "B"
+    assert m2.get_mtxt(obj1) == "A"
+    assert m0.get_mtxt(obj1) == "A"
+    assert m0.get_mtxt(obj2) == "B"
+
+
+def test_m0_rtrn_valu_atyp():
+    with pytest.raises(TypeError) as exc_info:
+        m0.rtrn_valu_atyp()
+    assert str(exc_info.value).startswith(
+        "Unable to convert function return value to a Python type!"
+    )