diff --git a/packages/runtime-dom/__tests__/customElement.spec.ts b/packages/runtime-dom/__tests__/customElement.spec.ts
index 976213f3783..c0474768266 100644
--- a/packages/runtime-dom/__tests__/customElement.spec.ts
+++ b/packages/runtime-dom/__tests__/customElement.spec.ts
@@ -147,10 +147,12 @@ describe('defineCustomElement', () => {
     })
 
     // #12412
+    const contextElStyle = ':host { color: red }'
     const ContextEl = defineCustomElement({
       props: {
         msg: String,
       },
+      styles: [contextElStyle],
       setup(props, { expose }) {
         expose({
           text: () => props.msg,
@@ -171,27 +173,33 @@ describe('defineCustomElement', () => {
       await nextTick()
       await nextTick() // wait two ticks for disconnect
       expect('text' in parent).toBe(false)
+      expect(child.shadowRoot!.querySelectorAll('style').length).toBe(1)
       container.appendChild(parent) // should not throw Error
       await nextTick()
       expect(parent.text()).toBe('msg1')
-      expect(parent.shadowRoot!.textContent).toBe('msg1')
-      expect(child.shadowRoot!.textContent).toBe('msg1')
+      expect(parent.shadowRoot!.textContent).toBe(contextElStyle + 'msg1')
+      expect(child.shadowRoot!.textContent).toBe(contextElStyle + 'msg1')
       parent.setAttribute('msg', 'msg2')
       await nextTick()
-      expect(parent.shadowRoot!.textContent).toBe('msg2')
+      expect(parent.shadowRoot!.textContent).toBe(contextElStyle + 'msg2')
       await nextTick()
-      expect(child.shadowRoot!.textContent).toBe('msg2')
+      expect(child.shadowRoot!.textContent).toBe(contextElStyle + 'msg2')
+      expect(child.shadowRoot!.querySelectorAll('style').length).toBe(1)
     })
 
-    test('move element to change parent and context', async () => {
+    test('move element to new parent', async () => {
       container.innerHTML = `<my-context-el msg="msg1"></my-context-el><my-context-el msg="msg2"></my-context-el>`
       const first = container.children[0] as VueElement,
-        second = container.children[1] as VueElement
+        second = container.children[1] as VueElement & { text: () => string }
       await nextTick()
-      expect(second.shadowRoot!.textContent).toBe('msg2')
+      expect(second.shadowRoot!.textContent).toBe(contextElStyle + 'msg2')
       first.append(second)
       await nextTick()
-      expect(second.shadowRoot!.textContent).toBe('msg1')
+      expect(second.shadowRoot!.textContent).toBe(contextElStyle + 'msg1')
+      expect(second.shadowRoot!.querySelectorAll('style').length).toBe(1)
+      second.setAttribute('msg', 'msg3')
+      await nextTick()
+      expect(second.text()).toBe('msg3')
     })
   })
 
diff --git a/packages/runtime-dom/src/apiCustomElement.ts b/packages/runtime-dom/src/apiCustomElement.ts
index 0e72fa0adb5..b2b2d3f2011 100644
--- a/packages/runtime-dom/src/apiCustomElement.ts
+++ b/packages/runtime-dom/src/apiCustomElement.ts
@@ -298,12 +298,13 @@ export class VueElement
       }
     }
 
-    // unmount if parent changed and previously mounted, should keep parent
+    // unmount if parent changed and previously mounted, should keep parent and observer
     if (this._instance && parentChanged) this._unmount(true)
-    if (!this._instance) {
+    if (!this._instance || parentChanged) {
       if (this._resolved) {
-        this._setParent()
-        this._update()
+        // no instance means no observer
+        if (!this._instance) this._observe()
+        this._mount(this._def)
       } else {
         if (parent && parent._pendingResolve) {
           this._pendingResolve = parent._pendingResolve.then(() => {
@@ -324,10 +325,13 @@ export class VueElement
     }
   }
 
-  private _unmount(keepParent?: boolean) {
-    if (this._ob) {
-      this._ob.disconnect()
-      this._ob = null
+  private _unmount(keepParentAndOb?: boolean) {
+    if (!keepParentAndOb) {
+      this._parent = undefined
+      if (this._ob) {
+        this._ob.disconnect()
+        this._ob = null
+      }
     }
     this._app && this._app.unmount()
     if (this._instance) {
@@ -340,8 +344,6 @@ export class VueElement
       this._instance.ce = undefined
     }
     this._app = this._instance = null
-    if (!keepParent) this._parent = undefined
-    this._resolved = false
   }
 
   disconnectedCallback(): void {
@@ -353,6 +355,17 @@ export class VueElement
     })
   }
 
+  private _observe() {
+    if (!this._ob) {
+      this._ob = new MutationObserver(mutations => {
+        for (const m of mutations) {
+          this._setAttr(m.attributeName!)
+        }
+      })
+    }
+    this._ob.observe(this, { attributes: true })
+  }
+
   /**
    * resolve inner component definition (handle possible async component)
    */
@@ -367,13 +380,7 @@ export class VueElement
     }
 
     // watch future attr changes
-    this._ob = new MutationObserver(mutations => {
-      for (const m of mutations) {
-        this._setAttr(m.attributeName!)
-      }
-    })
-
-    this._ob.observe(this, { attributes: true })
+    this._observe()
 
     const resolve = (def: InnerComponentDef, isAsync = false) => {
       this._resolved = true
@@ -534,7 +541,7 @@ export class VueElement
         } else if (!val) {
           this.removeAttribute(hyphenate(key))
         }
-        ob && ob.observe(this, { attributes: true })
+        this._observe()
       }
     }
   }