diff --git a/packages/ipns/src/dnslink.ts b/packages/ipns/src/dnslink.ts
index 8ccf9ce6..48f34cab 100644
--- a/packages/ipns/src/dnslink.ts
+++ b/packages/ipns/src/dnslink.ts
@@ -1,10 +1,10 @@
 import { } from '@libp2p/interface'
-import { peerIdFromString } from '@libp2p/peer-id'
+import { peerIdFromCID, peerIdFromString } from '@libp2p/peer-id'
 import { RecordType } from '@multiformats/dns'
 import { CID } from 'multiformats/cid'
 import { DNSLinkNotFoundError } from './errors.js'
 import type { ResolveDNSLinkOptions } from './index.js'
-import type { Logger } from '@libp2p/interface'
+import type { Logger, PeerId } from '@libp2p/interface'
 import type { Answer, DNS } from '@multiformats/dns'
 
 const MAX_RECURSIVE_DEPTH = 32
@@ -66,7 +66,15 @@ async function recursiveResolveDnslink (domain: string, depth: number, dns: DNS,
         } catch {}
       } else if (protocol === 'ipns') {
         try {
-          const peerId = peerIdFromString(domainOrCID)
+          let peerId: PeerId
+
+          // eslint-disable-next-line max-depth
+          if (domainOrCID.charAt(0) === '1' || domainOrCID.charAt(0) === 'Q') {
+            peerId = peerIdFromString(domainOrCID)
+          } else {
+            // try parsing as a CID
+            peerId = peerIdFromCID(CID.parse(domainOrCID))
+          }
 
           // if the result is a PeerId, we've reached the end of the recursion
           return {
diff --git a/packages/ipns/test/resolve-dnslink.spec.ts b/packages/ipns/test/resolve-dnslink.spec.ts
index 588a37f0..bc5e1902 100644
--- a/packages/ipns/test/resolve-dnslink.spec.ts
+++ b/packages/ipns/test/resolve-dnslink.spec.ts
@@ -7,6 +7,7 @@ import { peerIdFromPrivateKey } from '@libp2p/peer-id'
 import { RecordType } from '@multiformats/dns'
 import { expect } from 'aegir/chai'
 import { MemoryDatastore } from 'datastore-core'
+import { base36 } from 'multiformats/bases/base36'
 import { CID } from 'multiformats/cid'
 import { stubInterface } from 'sinon-ts'
 import { ipns } from '../src/index.js'
@@ -172,6 +173,30 @@ describe('resolveDNSLink', () => {
     expect(result.path).to.equal('foobar/path/123')
   })
 
+  it('should resolve recursive dnslink -> <IPNS_base36_CID>/<path>', async () => {
+    const cid = CID.parse('QmUNLLsPACCz1vLxQVkXqqLX5R1X345qqfHbsf67hvA3Nn')
+    const key = await generateKeyPair('Ed25519')
+    const peerId = peerIdFromPrivateKey(key)
+    const peerIdBase36CID = peerId.toCID().toString(base36)
+    dns.query.withArgs('_dnslink.foobar.baz').resolves(dnsResponse([{
+      name: 'foobar.baz.',
+      TTL: 60,
+      type: RecordType.TXT,
+      data: `dnslink=/ipns/${peerIdBase36CID}/foobar/path/123`
+    }]))
+
+    await name.publish(key, cid)
+
+    const result = await name.resolveDNSLink('foobar.baz')
+
+    if (result == null) {
+      throw new Error('Did not resolve entry')
+    }
+
+    expect(result.cid.toString()).to.equal(cid.toV1().toString())
+    expect(result.path).to.equal('foobar/path/123')
+  })
+
   it('should follow CNAMES to delegated DNSLink domains', async () => {
     const cid = CID.parse('bafybeifcaqowoyito3qvsmbwbiugsu4umlxn4ehu223hvtubbfvwyuxjoe')
     const key = await generateKeyPair('Ed25519')