diff --git a/pytensor/tensor/rewriting/shape.py b/pytensor/tensor/rewriting/shape.py
index 39c149ad87..907f89d84a 100644
--- a/pytensor/tensor/rewriting/shape.py
+++ b/pytensor/tensor/rewriting/shape.py
@@ -423,7 +423,17 @@ def update_shape(self, r, other_r):
                 # This mean the shape is equivalent
                 # We do not want to do the ancestor check in those cases
                 merged_shape.append(r_shape[i])
-            elif r_shape[i] in ancestors([other_shape[i]]):
+            elif any(
+                (
+                    r_shape[i] == anc
+                    or (
+                        anc.owner
+                        and isinstance(anc.owner.op, Shape)
+                        and anc.owner.inputs[0] == r
+                    )
+                )
+                for anc in ancestors([other_shape[i]])
+            ):
                 # Another case where we want to use r_shape[i] is when
                 # other_shape[i] actually depends on r_shape[i]. In that case,
                 # we do not want to substitute an expression with another that
diff --git a/tests/tensor/rewriting/test_shape.py b/tests/tensor/rewriting/test_shape.py
index c0fd7513b3..e094aa8ed5 100644
--- a/tests/tensor/rewriting/test_shape.py
+++ b/tests/tensor/rewriting/test_shape.py
@@ -15,7 +15,7 @@
 from pytensor.graph.rewriting.basic import check_stack_trace, node_rewriter, out2in
 from pytensor.graph.rewriting.utils import rewrite_graph
 from pytensor.graph.type import Type
-from pytensor.tensor.basic import as_tensor_variable
+from pytensor.tensor.basic import alloc, as_tensor_variable
 from pytensor.tensor.elemwise import DimShuffle, Elemwise
 from pytensor.tensor.math import add, exp, maximum
 from pytensor.tensor.rewriting.basic import register_specialize
@@ -239,6 +239,25 @@ def test_no_shapeopt(self):
         # FIXME: This is not a good test.
         f([[1, 2], [2, 3]])
 
+    def test_shape_of_useless_alloc(self):
+        """Test that local_shape_to_shape_i does not create circular graph.
+
+        Regression test for #565
+        """
+        alpha = vector(shape=(None,), dtype="float64")
+        channel = vector(shape=(None,), dtype="float64")
+
+        broadcast_channel = alloc(
+            channel,
+            maximum(
+                shape(alpha)[0],
+                shape(channel)[0],
+            ),
+        )
+        out = shape(broadcast_channel)
+        fn = function([alpha, channel], out)
+        assert fn([1.0, 2, 3], [1.0, 2, 3]) == (3,)
+
 
 class TestReshape:
     def setup_method(self):