diff --git a/packages/block-editor/src/components/inserter/block-types-tab.js b/packages/block-editor/src/components/inserter/block-types-tab.js
index 50a8b46b46427..844d5dd341437 100644
--- a/packages/block-editor/src/components/inserter/block-types-tab.js
+++ b/packages/block-editor/src/components/inserter/block-types-tab.js
@@ -186,7 +186,7 @@ export function BlockTypesTab(
 			continue;
 		}
 
-		if ( rootClientId && item.rootClientId === rootClientId ) {
+		if ( rootClientId && item.isAllowedInCurrentRoot ) {
 			itemsForCurrentRoot.push( item );
 		} else {
 			itemsRemaining.push( item );
diff --git a/packages/block-editor/src/components/inserter/hooks/use-block-types-state.js b/packages/block-editor/src/components/inserter/hooks/use-block-types-state.js
index 8db23267eee8f..6f11060c75c49 100644
--- a/packages/block-editor/src/components/inserter/hooks/use-block-types-state.js
+++ b/packages/block-editor/src/components/inserter/hooks/use-block-types-state.js
@@ -2,19 +2,23 @@
  * WordPress dependencies
  */
 import {
+	getBlockType,
 	createBlock,
 	createBlocksFromInnerBlocksTemplate,
 	store as blocksStore,
 	parse,
 } from '@wordpress/blocks';
-import { useSelect } from '@wordpress/data';
+import { useSelect, useDispatch } from '@wordpress/data';
 import { useCallback, useMemo } from '@wordpress/element';
+import { store as noticesStore } from '@wordpress/notices';
+import { __, sprintf } from '@wordpress/i18n';
 
 /**
  * Internal dependencies
  */
 import { store as blockEditorStore } from '../../../store';
-import { withRootClientIdOptionKey } from '../../../store/utils';
+import { isFiltered } from '../../../store/utils';
+import { unlock } from '../../../lock-unlock';
 
 /**
  * Retrieves the block types inserter state.
@@ -26,7 +30,7 @@ import { withRootClientIdOptionKey } from '../../../store/utils';
  */
 const useBlockTypesState = ( rootClientId, onInsert, isQuick ) => {
 	const options = useMemo(
-		() => ( { [ withRootClientIdOptionKey ]: ! isQuick } ),
+		() => ( { [ isFiltered ]: !! isQuick } ),
 		[ isQuick ]
 	);
 	const [ items ] = useSelect(
@@ -38,6 +42,10 @@ const useBlockTypesState = ( rootClientId, onInsert, isQuick ) => {
 		],
 		[ rootClientId, options ]
 	);
+	const { getClosestAllowedInsertionPoint } = unlock(
+		useSelect( blockEditorStore )
+	);
+	const { createErrorNotice } = useDispatch( noticesStore );
 
 	const [ categories, collections ] = useSelect( ( select ) => {
 		const { getCategories, getCollections } = select( blocksStore );
@@ -46,16 +54,29 @@ const useBlockTypesState = ( rootClientId, onInsert, isQuick ) => {
 
 	const onSelectItem = useCallback(
 		(
-			{
-				name,
-				initialAttributes,
-				innerBlocks,
-				syncStatus,
-				content,
-				rootClientId: _rootClientId,
-			},
+			{ name, initialAttributes, innerBlocks, syncStatus, content },
 			shouldFocusBlock
 		) => {
+			const destinationClientId = getClosestAllowedInsertionPoint(
+				name,
+				rootClientId
+			);
+			if ( destinationClientId === null ) {
+				const title = getBlockType( name )?.title ?? name;
+				createErrorNotice(
+					sprintf(
+						/* translators: %s: block pattern title. */
+						__( 'Block "%s" can\'t be inserted.' ),
+						title
+					),
+					{
+						type: 'snackbar',
+						id: 'inserter-notice',
+					}
+				);
+				return;
+			}
+
 			const insertedBlock =
 				syncStatus === 'unsynced'
 					? parse( content, {
@@ -66,15 +87,14 @@ const useBlockTypesState = ( rootClientId, onInsert, isQuick ) => {
 							initialAttributes,
 							createBlocksFromInnerBlocksTemplate( innerBlocks )
 					  );
-
 			onInsert(
 				insertedBlock,
 				undefined,
 				shouldFocusBlock,
-				_rootClientId
+				destinationClientId
 			);
 		},
-		[ onInsert ]
+		[ onInsert, getClosestAllowedInsertionPoint, rootClientId ]
 	);
 
 	return [ items, categories, collections, onSelectItem ];
diff --git a/packages/block-editor/src/components/inserter/hooks/use-insertion-point.js b/packages/block-editor/src/components/inserter/hooks/use-insertion-point.js
index 24074ec500456..0cd71bf77b983 100644
--- a/packages/block-editor/src/components/inserter/hooks/use-insertion-point.js
+++ b/packages/block-editor/src/components/inserter/hooks/use-insertion-point.js
@@ -71,7 +71,11 @@ function useInsertionPoint( {
 	selectBlockOnInsert = true,
 } ) {
 	const registry = useRegistry();
-	const { getSelectedBlock } = useSelect( blockEditorStore );
+	const {
+		getSelectedBlock,
+		getClosestAllowedInsertionPoint,
+		isBlockInsertionPointVisible,
+	} = unlock( useSelect( blockEditorStore ) );
 	const { destinationRootClientId, destinationIndex } = useSelect(
 		( select ) => {
 			const {
@@ -193,21 +197,30 @@ function useInsertionPoint( {
 
 	const onToggleInsertionPoint = useCallback(
 		( item ) => {
-			if ( item?.hasOwnProperty( 'rootClientId' ) ) {
-				showInsertionPoint(
-					item.rootClientId,
-					getIndex( {
-						destinationRootClientId,
-						destinationIndex,
-						rootClientId: item.rootClientId,
-						registry,
-					} )
-				);
+			if ( item && ! isBlockInsertionPointVisible() ) {
+				const allowedDestinationRootClientId =
+					getClosestAllowedInsertionPoint(
+						item.name,
+						destinationRootClientId
+					);
+				if ( allowedDestinationRootClientId !== null ) {
+					showInsertionPoint(
+						allowedDestinationRootClientId,
+						getIndex( {
+							destinationRootClientId,
+							destinationIndex,
+							rootClientId: allowedDestinationRootClientId,
+							registry,
+						} )
+					);
+				}
 			} else {
 				hideInsertionPoint();
 			}
 		},
 		[
+			getClosestAllowedInsertionPoint,
+			isBlockInsertionPointVisible,
 			showInsertionPoint,
 			hideInsertionPoint,
 			destinationRootClientId,
diff --git a/packages/block-editor/src/components/inserter/hooks/use-patterns-state.js b/packages/block-editor/src/components/inserter/hooks/use-patterns-state.js
index 6483dc58ae8b9..f8b083d4eedf1 100644
--- a/packages/block-editor/src/components/inserter/hooks/use-patterns-state.js
+++ b/packages/block-editor/src/components/inserter/hooks/use-patterns-state.js
@@ -87,7 +87,7 @@ const usePatternsState = ( onInsert, rootClientId, selectedCategory ) => {
 				),
 				{
 					type: 'snackbar',
-					id: 'block-pattern-inserted-notice',
+					id: 'inserter-notice',
 				}
 			);
 		},
diff --git a/packages/block-editor/src/components/inserter/media-tab/media-preview.js b/packages/block-editor/src/components/inserter/media-tab/media-preview.js
index 64088f45fa1c3..a890e5fe8dc13 100644
--- a/packages/block-editor/src/components/inserter/media-tab/media-preview.js
+++ b/packages/block-editor/src/components/inserter/media-tab/media-preview.js
@@ -184,13 +184,16 @@ export function MediaPreview( { media, onClick, category } ) {
 							} );
 							createSuccessNotice(
 								__( 'Image uploaded and inserted.' ),
-								{ type: 'snackbar' }
+								{ type: 'snackbar', id: 'inserter-notice' }
 							);
 							setIsInserting( false );
 						},
 						allowedTypes: ALLOWED_MEDIA_TYPES,
 						onError( message ) {
-							createErrorNotice( message, { type: 'snackbar' } );
+							createErrorNotice( message, {
+								type: 'snackbar',
+								id: 'inserter-notice',
+							} );
 							setIsInserting( false );
 						},
 					} );
@@ -281,6 +284,7 @@ export function MediaPreview( { media, onClick, category } ) {
 						onClick( cloneBlock( block ) );
 						createSuccessNotice( __( 'Image inserted.' ), {
 							type: 'snackbar',
+							id: 'inserter-notice',
 						} );
 						setShowExternalUploadModal( false );
 					} }
diff --git a/packages/block-editor/src/components/inserter/test/block-types-tab.native.js b/packages/block-editor/src/components/inserter/test/block-types-tab.native.js
deleted file mode 100644
index 925570130359a..0000000000000
--- a/packages/block-editor/src/components/inserter/test/block-types-tab.native.js
+++ /dev/null
@@ -1,67 +0,0 @@
-/**
- * External dependencies
- */
-import { render } from 'test/helpers';
-
-/**
- * WordPress dependencies
- */
-import { useSelect } from '@wordpress/data';
-
-/**
- * Internal dependencies
- */
-import items from './fixtures';
-import BlockTypesTab from '../block-types-tab';
-
-jest.mock( '../hooks/use-clipboard-block' );
-jest.mock( '@wordpress/data/src/components/use-select' );
-
-const selectMock = {
-	getCategories: jest.fn().mockReturnValue( [] ),
-	getCollections: jest.fn().mockReturnValue( [] ),
-	getInserterItems: jest.fn().mockReturnValue( [] ),
-	canInsertBlockType: jest.fn(),
-	getBlockType: jest.fn(),
-	getClipboard: jest.fn(),
-	getSettings: jest.fn( () => ( { impressions: {} } ) ),
-};
-
-describe( 'BlockTypesTab component', () => {
-	beforeEach( () => {
-		useSelect.mockImplementation( ( callback ) =>
-			callback( () => selectMock )
-		);
-	} );
-
-	it( 'renders without crashing', () => {
-		const component = render(
-			<BlockTypesTab
-				rootClientId={ 0 }
-				onSelect={ jest.fn() }
-				listProps={ { contentContainerStyle: {} } }
-			/>
-		);
-		expect( component ).toBeTruthy();
-	} );
-
-	it( 'shows block items', () => {
-		selectMock.getInserterItems.mockReturnValue( items );
-
-		const blockItems = items.filter(
-			( { id, category } ) =>
-				category !== 'reusable' && id !== 'core-embed/a-paragraph-embed'
-		);
-		const component = render(
-			<BlockTypesTab
-				rootClientId={ 0 }
-				onSelect={ jest.fn() }
-				listProps={ { contentContainerStyle: {} } }
-			/>
-		);
-
-		blockItems.forEach( ( item ) => {
-			expect( component.getByText( item.title ) ).toBeTruthy();
-		} );
-	} );
-} );
diff --git a/packages/block-editor/src/store/private-selectors.js b/packages/block-editor/src/store/private-selectors.js
index 9e99176819ae8..02a37b94ec27f 100644
--- a/packages/block-editor/src/store/private-selectors.js
+++ b/packages/block-editor/src/store/private-selectors.js
@@ -16,6 +16,7 @@ import {
 	getTemplateLock,
 	getClientIdsWithDescendants,
 	isNavigationMode,
+	getBlockRootClientId,
 } from './selectors';
 import {
 	checkAllowListRecursive,
@@ -637,3 +638,40 @@ export function getZoomLevel( state ) {
 export function isZoomOut( state ) {
 	return getZoomLevel( state ) < 100;
 }
+
+/**
+ * Finds the closest block where the block is allowed to be inserted.
+ *
+ * @param {Object} state    Editor state.
+ * @param {string} name     Block name.
+ * @param {string} clientId Default insertion point.
+ *
+ * @return {string} clientID of the closest container when the block name can be inserted.
+ */
+export function getClosestAllowedInsertionPoint( state, name, clientId = '' ) {
+	// If we're trying to insert at the root level and it's not allowed
+	// Try the section root instead.
+	if ( ! clientId ) {
+		if ( canInsertBlockType( state, name, clientId ) ) {
+			return clientId;
+		}
+
+		const sectionRootClientId = getSectionRootClientId( state );
+		if (
+			sectionRootClientId &&
+			canInsertBlockType( state, name, sectionRootClientId )
+		) {
+			return sectionRootClientId;
+		}
+		return null;
+	}
+
+	// Traverse the block tree up until we find a place where we can insert.
+	let current = clientId;
+	while ( current !== null && ! canInsertBlockType( state, name, current ) ) {
+		const parentClientId = getBlockRootClientId( state, current );
+		current = parentClientId;
+	}
+
+	return current;
+}
diff --git a/packages/block-editor/src/store/selectors.js b/packages/block-editor/src/store/selectors.js
index 20d6627398886..3163bb5257a9a 100644
--- a/packages/block-editor/src/store/selectors.js
+++ b/packages/block-editor/src/store/selectors.js
@@ -21,7 +21,7 @@ import { createSelector, createRegistrySelector } from '@wordpress/data';
  * Internal dependencies
  */
 import {
-	withRootClientIdOptionKey,
+	isFiltered,
 	checkAllowListRecursive,
 	checkAllowList,
 	getAllPatternsDependants,
@@ -80,7 +80,9 @@ const EMPTY_ARRAY = [];
  */
 const EMPTY_SET = new Set();
 
-const EMPTY_OBJECT = {};
+const DEFAULT_INSERTER_OPTIONS = {
+	[ isFiltered ]: true,
+};
 
 /**
  * Returns a block's name given its client ID, or null if no block exists with
@@ -2008,7 +2010,7 @@ const buildBlockTypeItem =
  */
 export const getInserterItems = createRegistrySelector( ( select ) =>
 	createSelector(
-		( state, rootClientId = null, options = EMPTY_OBJECT ) => {
+		( state, rootClientId = null, options = DEFAULT_INSERTER_OPTIONS ) => {
 			const buildReusableBlockInserterItem = ( reusableBlock ) => {
 				const icon = ! reusableBlock.wp_pattern_sync_status
 					? {
@@ -2056,56 +2058,7 @@ export const getInserterItems = createRegistrySelector( ( select ) =>
 				)
 				.map( buildBlockTypeInserterItem );
 
-			if ( options[ withRootClientIdOptionKey ] ) {
-				blockTypeInserterItems = blockTypeInserterItems.reduce(
-					( accumulator, item ) => {
-						item.rootClientId = rootClientId ?? '';
-
-						while (
-							! canInsertBlockTypeUnmemoized(
-								state,
-								item.name,
-								item.rootClientId
-							)
-						) {
-							if ( ! item.rootClientId ) {
-								let sectionRootClientId;
-								try {
-									sectionRootClientId =
-										getSectionRootClientId( state );
-								} catch ( e ) {}
-								if (
-									sectionRootClientId &&
-									canInsertBlockTypeUnmemoized(
-										state,
-										item.name,
-										sectionRootClientId
-									)
-								) {
-									item.rootClientId = sectionRootClientId;
-								} else {
-									delete item.rootClientId;
-								}
-								break;
-							} else {
-								const parentClientId = getBlockRootClientId(
-									state,
-									item.rootClientId
-								);
-								item.rootClientId = parentClientId;
-							}
-						}
-
-						// We could also add non insertable items and gray them out.
-						if ( item.hasOwnProperty( 'rootClientId' ) ) {
-							accumulator.push( item );
-						}
-
-						return accumulator;
-					},
-					[]
-				);
-			} else {
+			if ( options[ isFiltered ] !== false ) {
 				blockTypeInserterItems = blockTypeInserterItems.filter(
 					( blockType ) =>
 						canIncludeBlockTypeInInserter(
@@ -2114,6 +2067,17 @@ export const getInserterItems = createRegistrySelector( ( select ) =>
 							rootClientId
 						)
 				);
+			} else {
+				blockTypeInserterItems = blockTypeInserterItems.map(
+					( blockType ) => ( {
+						...blockType,
+						isAllowedInCurrentRoot: canIncludeBlockTypeInInserter(
+							state,
+							blockType,
+							rootClientId
+						),
+					} )
+				);
 			}
 
 			const items = blockTypeInserterItems.reduce(
diff --git a/packages/block-editor/src/store/utils.js b/packages/block-editor/src/store/utils.js
index 79e15255e6cc1..9b83a8f74cf9a 100644
--- a/packages/block-editor/src/store/utils.js
+++ b/packages/block-editor/src/store/utils.js
@@ -12,8 +12,7 @@ import { unlock } from '../lock-unlock';
 import { STORE_NAME } from './constants';
 import { getSectionRootClientId } from './private-selectors';
 
-export const withRootClientIdOptionKey = Symbol( 'withRootClientId' );
-
+export const isFiltered = Symbol( 'isFiltered' );
 const parsedPatternCache = new WeakMap();
 const grammarMapCache = new WeakMap();