diff --git a/cirq-core/cirq/transformers/drop_negligible_operations.py b/cirq-core/cirq/transformers/drop_negligible_operations.py
index a2a2ed1c069..51c11366e83 100644
--- a/cirq-core/cirq/transformers/drop_negligible_operations.py
+++ b/cirq-core/cirq/transformers/drop_negligible_operations.py
@@ -43,6 +43,8 @@ def drop_negligible_operations(
     Returns:
           Copy of the transformed input circuit.
     """
+    if context is None:
+        context = transformer_api.TransformerContext()
 
     def map_func(op: 'cirq.Operation', _: int) -> 'cirq.OP_TREE':
         return (
@@ -50,5 +52,5 @@ def map_func(op: 'cirq.Operation', _: int) -> 'cirq.OP_TREE':
         )
 
     return transformer_primitives.map_operations(
-        circuit, map_func, tags_to_ignore=context.tags_to_ignore if context else ()
+        circuit, map_func, tags_to_ignore=context.tags_to_ignore, deep=context.deep
     ).unfreeze(copy=False)
diff --git a/cirq-core/cirq/transformers/drop_negligible_operations_test.py b/cirq-core/cirq/transformers/drop_negligible_operations_test.py
index 531d135a7cd..3f454decf95 100644
--- a/cirq-core/cirq/transformers/drop_negligible_operations_test.py
+++ b/cirq-core/cirq/transformers/drop_negligible_operations_test.py
@@ -59,3 +59,39 @@ def test_clears_known_empties_even_at_zero_tolerance():
             cirq.Moment(),
         ),
     )
+
+
+def test_recursively_runs_inside_circuit_ops_deep():
+    a = cirq.NamedQubit('a')
+    small_op = cirq.Z(a) ** 0.000001
+    nested_circuit = cirq.FrozenCircuit(
+        cirq.X(a), small_op, small_op.with_tags(NO_COMPILE_TAG), small_op, cirq.Y(a)
+    )
+    nested_circuit_dropped = cirq.FrozenCircuit(
+        cirq.Moment(cirq.X(a)),
+        cirq.Moment(),
+        cirq.Moment(small_op.with_tags(NO_COMPILE_TAG)),
+        cirq.Moment(),
+        cirq.Moment(cirq.Y(a)),
+    )
+    c_orig = cirq.Circuit(
+        small_op,
+        cirq.CircuitOperation(nested_circuit).repeat(6).with_tags(NO_COMPILE_TAG),
+        small_op,
+        cirq.CircuitOperation(nested_circuit).repeat(5).with_tags("preserve_tag"),
+        small_op,
+    )
+    c_expected = cirq.Circuit(
+        cirq.Moment(),
+        cirq.Moment(cirq.CircuitOperation(nested_circuit).repeat(6).with_tags(NO_COMPILE_TAG)),
+        cirq.Moment(),
+        cirq.Moment(
+            cirq.CircuitOperation(nested_circuit_dropped).repeat(5).with_tags("preserve_tag")
+        ),
+        cirq.Moment(),
+    )
+    context = cirq.TransformerContext(tags_to_ignore=[NO_COMPILE_TAG], deep=True)
+    cirq.testing.assert_same_circuits(
+        cirq.drop_negligible_operations(c_orig, context=context, atol=0.001),
+        c_expected,
+    )