diff --git a/CHANGELOG.md b/CHANGELOG.md
index 68151f6d3c..eb43e76781 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -13,6 +13,7 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 
 ### Changed
 
+- Preserve properties and referenced models inside a single inline `allOf` object.
 - Dart: escape enum options named value or values to avoid conflicts with generated and built-in enum members. [#7807](https://github.com/microsoft/kiota/issues/7807)
 - C#: escape Unicode line and paragraph separators in generated string literals so generated clients remain valid C# source.
 - External reference allowlist wildcards no longer cross the URI authority boundary, so a wildcard in the scheme or host cannot match text in the path, the user information or the port.
diff --git a/src/Kiota.Builder/KiotaBuilder.cs b/src/Kiota.Builder/KiotaBuilder.cs
index 0d583b399d..133a36f5a5 100644
--- a/src/Kiota.Builder/KiotaBuilder.cs
+++ b/src/Kiota.Builder/KiotaBuilder.cs
@@ -2095,6 +2095,13 @@ private CodeTypeBase CreateModelDeclarations(OpenApiUrlTreeNode currentNode, IOp
             return CreateModelDeclarationAndType(currentNode, mergedSchema, operation, codeNamespace, suffix, response: responseValue, typeNameForInlineSchema: typeNameForInlineSchema, isRequestBody, dynamicBindingSuffixContext: suffixForInlineSchema);
         }
 
+        if (schema.AllOf is { Count: 1 } && !schema.AllOf[0].IsReferencedSchema() && schema.AllOf[0].HasAnyProperty() &&
+            schema.MergeAllOfSchemaEntries() is IOpenApiSchema singleInlineSchema)
+        {
+            // A single inline object still contributes properties, even without an inheritance relationship.
+            return CreateModelDeclarationAndType(currentNode, singleInlineSchema, operation, codeNamespace, suffix, response: responseValue, typeNameForInlineSchema: typeNameForInlineSchema, isRequestBody, dynamicBindingSuffixContext: suffixForInlineSchema);
+        }
+
         if ((schema.IsInclusiveUnion() || schema.IsExclusiveUnion()) && string.IsNullOrEmpty(schema.Format)
             && !schema.IsODataPrimitiveType())
         { // OData types are oneOf string, type + format, enum
diff --git a/tests/Kiota.Builder.Tests/KiotaBuilderTests.SingleInlineAllOf.cs b/tests/Kiota.Builder.Tests/KiotaBuilderTests.SingleInlineAllOf.cs
new file mode 100644
index 0000000000..f8fc642598
--- /dev/null
+++ b/tests/Kiota.Builder.Tests/KiotaBuilderTests.SingleInlineAllOf.cs
@@ -0,0 +1,58 @@
+using System.Threading.Tasks;
+
+using Kiota.Builder.CodeDOM;
+using Kiota.Builder.Configuration;
+
+using Microsoft.Extensions.Logging.Abstractions;
+
+using Xunit;
+
+namespace Kiota.Builder.Tests;
+
+public sealed partial class KiotaBuilderTests
+{
+    [Theory]
+    [InlineData(true, true)]
+    [InlineData(true, false)]
+    [InlineData(false, true)]
+    [InlineData(true, true, true)]
+    public async Task SingleInlineAllOfPreservesReferencedPropertiesAsync(bool wrapped, bool explicitType, bool siblingProperty = false)
+    {
+        const string inlineSchema = """
+        {"type":"object","required":["other"],"properties":{
+          "other":{"$ref":"#/components/schemas/Identification"}
+        }}
+        """;
+        var accountSchema = wrapped ? "{" + (explicitType ? "\"type\":\"object\"," : "") +
+            (siblingProperty ? "\"properties\":{\"label\":{\"type\":\"string\"}}," : "") +
+            "\"allOf\":[" + inlineSchema + "]}" : inlineSchema;
+        var description = """
+        {
+          "openapi":"3.0.3","info":{"title":"Single inline allOf","version":"1.0"},
+          "paths":{"/account":{"get":{"responses":{"200":{"description":"Success","content":{
+            "application/json":{"schema":{"$ref":"#/components/schemas/Account"}}
+          }}}}}},
+          "components":{"schemas":{
+            "Account":ACCOUNT_SCHEMA,
+            "Identification":{"type":"object","properties":{"identification":{"type":"string"}}}
+          }}
+        }
+        """.Replace("ACCOUNT_SCHEMA", accountSchema);
+        await using var stream = await GetDocumentStreamAsync(description);
+        var builder = new KiotaBuilder(NullLogger<KiotaBuilder>.Instance,
+            new GenerationConfiguration { IncludeAdditionalData = false }, _httpClient);
+        var document = await builder.CreateOpenApiDocumentAsync(stream, cancellationToken: TestContext.Current.CancellationToken);
+        Assert.NotNull(document);
+        var model = builder.CreateSourceModel(builder.CreateUriSpace(document));
+        var account = model.FindChildByName<CodeClass>("Account");
+        Assert.NotNull(account);
+        var other = Assert.Single(account.Properties, static p => p.Name == "other");
+        Assert.Equal("other", other.Name);
+        if (siblingProperty)
+            Assert.Contains(account.Properties, static p => p.Name == "label");
+        var identification = model.FindChildByName<CodeClass>("Identification");
+        Assert.NotNull(identification);
+        Assert.Same(identification, Assert.IsType<CodeType>(other.Type).TypeDefinition);
+        Assert.Contains(identification.Properties, static p => p.Name == "identification");
+    }
+}