diff --git a/qiskit/compiler/transpiler.py b/qiskit/compiler/transpiler.py
index dc93c85a5fcf..706a223f8c92 100644
--- a/qiskit/compiler/transpiler.py
+++ b/qiskit/compiler/transpiler.py
@@ -28,7 +28,6 @@
 from qiskit import user_config
 from qiskit.circuit.quantumcircuit import QuantumCircuit
 from qiskit.circuit.quantumregister import Qubit
-from qiskit.converters import isinstanceint, isinstancelist
 from qiskit.dagcircuit import DAGCircuit
 from qiskit.providers.backend import Backend
 from qiskit.providers.models import BackendProperties
@@ -757,16 +756,27 @@ def _parse_initial_layout(initial_layout, circuits):
     def _layout_from_raw(initial_layout, circuit):
         if initial_layout is None or isinstance(initial_layout, Layout):
             return initial_layout
-        elif isinstancelist(initial_layout):
-            if all(isinstanceint(elem) for elem in initial_layout):
-                initial_layout = Layout.from_intlist(initial_layout, *circuit.qregs)
-            elif all(elem is None or isinstance(elem, Qubit) for elem in initial_layout):
-                initial_layout = Layout.from_qubit_list(initial_layout, *circuit.qregs)
-        elif isinstance(initial_layout, dict):
-            initial_layout = Layout(initial_layout)
+        if isinstance(initial_layout, dict):
+            return Layout(initial_layout)
+        # Should be an iterable either of ints or bits/None.
+        specifier = tuple(initial_layout)
+        if all(phys is None or isinstance(phys, Qubit) for phys in specifier):
+            mapping = {phys: virt for phys, virt in enumerate(specifier) if virt is not None}
+            if len(mapping) != circuit.num_qubits:
+                raise TranspilerError(
+                    f"'initial_layout' ({len(mapping)}) and circuit ({circuit.num_qubits}) had"
+                    " different numbers of qubits"
+                )
         else:
-            raise TranspilerError("The initial_layout parameter could not be parsed")
-        return initial_layout
+            if len(specifier) != circuit.num_qubits:
+                raise TranspilerError(
+                    f"'initial_layout' ({len(specifier)}) and circuit ({circuit.num_qubits}) had"
+                    " different numbers of qubits"
+                )
+            if len(specifier) != len(set(specifier)):
+                raise TranspilerError(f"'initial_layout' contained duplicate entries: {specifier}")
+            mapping = {int(phys): virt for phys, virt in zip(specifier, circuit.qubits)}
+        return Layout(mapping)
 
     # multiple layouts?
     if isinstance(initial_layout, list) and any(
diff --git a/releasenotes/notes/fix-initial_layout-loose-qubits-0c59b2d6fb99d7e6.yaml b/releasenotes/notes/fix-initial_layout-loose-qubits-0c59b2d6fb99d7e6.yaml
new file mode 100644
index 000000000000..4bac5214f5c6
--- /dev/null
+++ b/releasenotes/notes/fix-initial_layout-loose-qubits-0c59b2d6fb99d7e6.yaml
@@ -0,0 +1,6 @@
+---
+fixes:
+  - |
+    Using ``initial_layout`` in calls to :func:`.transpile` will no longer error if the
+    circuit contains qubits not in any registers, or qubits that exist in more than one
+    register.  See `#10125 <https://github.com/Qiskit/qiskit-terra/issues/10125>`__.
diff --git a/test/python/compiler/test_transpiler.py b/test/python/compiler/test_transpiler.py
index fe5670aba861..c25425d051f1 100644
--- a/test/python/compiler/test_transpiler.py
+++ b/test/python/compiler/test_transpiler.py
@@ -627,14 +627,9 @@ def test_wrong_initial_layout(self):
             QuantumRegister(3, "q")[2],
         ]
 
-        with self.assertRaises(TranspilerError) as cm:
+        with self.assertRaisesRegex(TranspilerError, "different numbers of qubits"):
             transpile(qc, backend, initial_layout=bad_initial_layout)
 
-        self.assertEqual(
-            "FullAncillaAllocation: The layout refers to a qubit that does not exist in circuit.",
-            cm.exception.message,
-        )
-
     def test_parameterized_circuit_for_simulator(self):
         """Verify that a parameterized circuit can be transpiled for a simulator backend."""
         qr = QuantumRegister(2, name="qr")
@@ -1616,6 +1611,30 @@ def test_transpile_identity_circuit_no_target(self, opt_level):
         result = transpile(qc, optimization_level=opt_level)
         self.assertEqual(empty_qc, result)
 
+    @data(0, 1, 2, 3)
+    def test_initial_layout_with_loose_qubits(self, opt_level):
+        """Regression test of gh-10125."""
+        qc = QuantumCircuit([Qubit(), Qubit()])
+        qc.cx(0, 1)
+        transpiled = transpile(qc, initial_layout=[1, 0], optimization_level=opt_level)
+        self.assertIsNotNone(transpiled.layout)
+        self.assertEqual(
+            transpiled.layout.initial_layout, Layout({0: qc.qubits[1], 1: qc.qubits[0]})
+        )
+
+    @data(0, 1, 2, 3)
+    def test_initial_layout_with_overlapping_qubits(self, opt_level):
+        """Regression test of gh-10125."""
+        qr1 = QuantumRegister(2, "qr1")
+        qr2 = QuantumRegister(bits=qr1[:])
+        qc = QuantumCircuit(qr1, qr2)
+        qc.cx(0, 1)
+        transpiled = transpile(qc, initial_layout=[1, 0], optimization_level=opt_level)
+        self.assertIsNotNone(transpiled.layout)
+        self.assertEqual(
+            transpiled.layout.initial_layout, Layout({0: qc.qubits[1], 1: qc.qubits[0]})
+        )
+
 
 @ddt
 class TestPostTranspileIntegration(QiskitTestCase):