diff --git a/RELEASE_NOTES.md b/RELEASE_NOTES.md
index eddb4f9..d4001e7 100644
--- a/RELEASE_NOTES.md
+++ b/RELEASE_NOTES.md
@@ -16,4 +16,4 @@
 
 ## Bug Fixes
 
-<!-- Here goes notable bug fixes that are worth a special mention or explanation -->
+- Fixed component graph rendering so children follow the vertical order of their parents, keeping upper-level branches above lower ones in the layered layout.
\ No newline at end of file
diff --git a/src/frequenz/gridpool/cli/_render_graph.py b/src/frequenz/gridpool/cli/_render_graph.py
index a47089d..2fe8851 100644
--- a/src/frequenz/gridpool/cli/_render_graph.py
+++ b/src/frequenz/gridpool/cli/_render_graph.py
@@ -124,7 +124,8 @@ def compute_layout(self, graph: Any) -> dict[Any, tuple[float, float]]:
 
         root_node = self._select_root(graph)
         layered_nodes = self._group_by_level(graph, root_node)
-        return self._build_positions(layered_nodes)
+        ordered_layers = self._order_layers(graph, layered_nodes)
+        return self._build_positions(ordered_layers)
 
     def _select_root(self, graph: Any) -> Any:
         """Select a root node for layout.
@@ -171,6 +172,56 @@ def _group_by_level(self, graph: Any, root_node: Any) -> dict[int, list[Any]]:
             layered_nodes[orphan_layer] = orphans
         return layered_nodes
 
+    def _order_layers(
+        self, graph: Any, layered_nodes: dict[int, list[Any]]
+    ) -> dict[int, list[Any]]:
+        """Order nodes within each layer based on their parent positions.
+
+        Reorders the nodes in each layer to improve visual readability when rendering a
+        layered graph layout. The first layer is ordered deterministically (by string
+        representation). For subsequent layers, nodes are ordered primarily by the
+        lowest index of any already-ordered parent (predecessor) from the previous
+        layers, with a deterministic string-based tie-breaker.
+
+        Args:
+            graph:
+                Graph-like object providing predecessor relationships via
+                ``graph.predecessors(node)``.
+            layered_nodes:
+                Mapping from layer index to the list of nodes assigned to that layer.
+
+        Returns:
+            A new mapping with the same layer keys as ``layered_nodes``, where each
+            layer's node list is ordered to align children beneath their parents.
+        """
+        ordered_layers: dict[int, list[Any]] = {}
+        previous_order: dict[Any, int] = {}
+
+        for level in sorted(layered_nodes):
+            nodes = layered_nodes[level]
+            if level == 0:
+                ordered_nodes = sorted(nodes, key=str)
+            else:
+
+                def sort_key(node: Any) -> tuple[int, str]:
+                    parents = [
+                        parent
+                        for parent in graph.predecessors(node)
+                        if parent in previous_order
+                    ]
+                    if parents:
+                        parent_index = min(previous_order[parent] for parent in parents)
+                    else:
+                        parent_index = len(previous_order)
+                    return (parent_index, str(node))
+
+                ordered_nodes = sorted(nodes, key=sort_key)
+
+            ordered_layers[level] = ordered_nodes
+            previous_order = {node: idx for idx, node in enumerate(ordered_nodes)}
+
+        return ordered_layers
+
     def _build_positions(
         self, layered_nodes: dict[int, list[Any]]
     ) -> dict[Any, tuple[float, float]]:
@@ -187,11 +238,11 @@ def _build_positions(
         """
         x_spacing, y_spacing = 2.5, 1.2
         pos: dict[Any, tuple[float, float]] = {}
-        for level, nodes in layered_nodes.items():
+        for level in sorted(layered_nodes):
+            nodes = layered_nodes[level]
             x_pos = level * x_spacing
-            sorted_nodes = sorted(nodes, key=str)
-            y_start = (len(sorted_nodes) - 1) * y_spacing / 2
-            for i, node in enumerate(sorted_nodes):
+            y_start = (len(nodes) - 1) * y_spacing / 2
+            for i, node in enumerate(nodes):
                 pos[node] = (x_pos, y_start - (i * y_spacing))
         return pos
 
diff --git a/tests/test_render_graph.py b/tests/test_render_graph.py
index fca10f1..5c2d6eb 100644
--- a/tests/test_render_graph.py
+++ b/tests/test_render_graph.py
@@ -122,7 +122,7 @@ def test_group_by_level_adds_orphans() -> None:
 def test_build_positions_centers_nodes_in_layer() -> None:
     """It should center nodes vertically within each layer."""
     renderer = ComponentGraphRenderer(MagicMock(spec=AssetsApiClient))
-    layered_nodes = {0: ["b", "a"], 1: ["c"]}
+    layered_nodes = {0: ["a", "b"], 1: ["c"]}
 
     pos = renderer._build_positions(layered_nodes)  # pylint: disable=protected-access
 
@@ -131,6 +131,21 @@ def test_build_positions_centers_nodes_in_layer() -> None:
     assert pos["c"] == (2.5, 0.0)
 
 
+def test_compute_layout_orders_children_by_parent_position() -> None:
+    """It should keep children of higher parents above lower ones."""
+    renderer = ComponentGraphRenderer(MagicMock(spec=AssetsApiClient))
+    graph: nx.DiGraph[Any] = nx.DiGraph()
+    graph.add_edge("root", "a")
+    graph.add_edge("root", "b")
+    graph.add_edge("a", "a_child")
+    graph.add_edge("b", "b_child")
+
+    pos = renderer.compute_layout(graph)
+
+    assert pos["a"][1] > pos["b"][1]
+    assert pos["a_child"][1] > pos["b_child"][1]
+
+
 def test_render_writes_file_without_show(monkeypatch: pytest.MonkeyPatch) -> None:
     """It should save a figure and avoid showing it when configured."""
     renderer = ComponentGraphRenderer(MagicMock(spec=AssetsApiClient))