diff --git a/lib/libzfs/libzfs_sendrecv.c b/lib/libzfs/libzfs_sendrecv.c
index b9780720e5a3..97920ce6f21c 100644
--- a/lib/libzfs/libzfs_sendrecv.c
+++ b/lib/libzfs/libzfs_sendrecv.c
@@ -3376,66 +3376,78 @@ created_before(libzfs_handle_t *hdl, avl_tree_t *avl,
  */
 static int
 recv_fix_encryption_hierarchy(libzfs_handle_t *hdl, const char *top_zfs,
-    nvlist_t *stream_nv)
+    nvlist_t *stream_nv, avl_tree_t *stream_avl)
 {
 	int err;
 	nvpair_t *fselem = NULL;
-	nvlist_t *stream_fss;
+	nvlist_t *local_nv;
+	avl_tree_t *local_avl;
+	boolean_t recursive;
+
+	recursive = (nvlist_lookup_boolean(stream_nv, "not_recursive") ==
+	    ENOENT);
 
-	stream_fss = fnvlist_lookup_nvlist(stream_nv, "fss");
+	/* Using top_zfs, gather the nvlists for all local filesystems. */
+	if ((err = gather_nvlist(hdl, top_zfs, NULL, NULL,
+	    recursive, B_TRUE, B_FALSE, recursive, B_FALSE, B_FALSE, B_FALSE,
+	    B_FALSE, B_TRUE, &local_nv, &local_avl)) != 0)
+		return (err);
 
-	while ((fselem = nvlist_next_nvpair(stream_fss, fselem)) != NULL) {
+	/*
+	 * Go through the nvlists of the local filesystems and check for
+	 * encryption roots.
+	 */
+	while ((fselem = nvlist_next_nvpair(local_nv, fselem)) != NULL) {
 		zfs_handle_t *zhp = NULL;
 		uint64_t crypt;
-		nvlist_t *snaps, *props, *stream_nvfs = NULL;
-		nvpair_t *snapel = NULL;
+		nvlist_t *stream_props, *snaps, *stream_nvfs = NULL,
+		    *nvfs = NULL;
 		boolean_t is_encroot, is_clone, stream_encroot;
-		char *cp;
-		const char *stream_keylocation = NULL;
+		const char *stream_keylocation = NULL, *fsname;
 		char keylocation[MAXNAMELEN];
-		char fsname[ZFS_MAX_DATASET_NAME_LEN];
-
-		keylocation[0] = '\0';
-		stream_nvfs = fnvpair_value_nvlist(fselem);
-		snaps = fnvlist_lookup_nvlist(stream_nvfs, "snaps");
-		props = fnvlist_lookup_nvlist(stream_nvfs, "props");
-		stream_encroot = nvlist_exists(stream_nvfs, "is_encroot");
-
-		/* find a snapshot from the stream that exists locally */
-		err = ENOENT;
-		while ((snapel = nvlist_next_nvpair(snaps, snapel)) != NULL) {
-			uint64_t guid;
-
-			guid = fnvpair_value_uint64(snapel);
-			err = guid_to_name(hdl, top_zfs, guid, B_FALSE,
-			    fsname);
-			if (err == 0)
-				break;
-		}
-
-		if (err != 0)
-			continue;
-
-		cp = strchr(fsname, '@');
-		if (cp != NULL)
-			*cp = '\0';
+		nvpair_t *snapelem;
 
+		nvfs = fnvpair_value_nvlist(fselem);
+		snaps = fnvlist_lookup_nvlist(nvfs, "snaps");
+		fsname = fnvlist_lookup_string(nvfs, "name");
 		zhp = zfs_open(hdl, fsname, ZFS_TYPE_DATASET);
 		if (zhp == NULL) {
 			err = ENOENT;
 			goto error;
 		}
 
-		crypt = zfs_prop_get_int(zhp, ZFS_PROP_ENCRYPTION);
-		is_clone = zhp->zfs_dmustats.dds_origin[0] != '\0';
-		(void) zfs_crypto_get_encryption_root(zhp, &is_encroot, NULL);
-
 		/* we don't need to do anything for unencrypted datasets */
+		crypt = zfs_prop_get_int(zhp, ZFS_PROP_ENCRYPTION);
 		if (crypt == ZIO_CRYPT_OFF) {
 			zfs_close(zhp);
 			continue;
 		}
 
+		is_clone = zhp->zfs_dmustats.dds_origin[0] != '\0';
+		(void) zfs_crypto_get_encryption_root(zhp, &is_encroot, NULL);
+		keylocation[0] = '\0';
+
+		/*
+		 * Go through the snapshots of the local filesystem and find
+		 * the stream's filesystem.
+		 */
+		for (snapelem = nvlist_next_nvpair(snaps, NULL);
+		    snapelem; snapelem = nvlist_next_nvpair(snaps, snapelem)) {
+			uint64_t thisguid;
+
+			thisguid = fnvpair_value_uint64(snapelem);
+			stream_nvfs = fsavl_find(stream_avl, thisguid, NULL);
+
+			if (stream_nvfs != NULL)
+				break;
+		}
+
+		if (stream_nvfs == NULL)
+			continue;
+
+		stream_props = fnvlist_lookup_nvlist(stream_nvfs, "props");
+		stream_encroot = nvlist_exists(stream_nvfs, "is_encroot");
+
 		/*
 		 * If the dataset is flagged as an encryption root, was not
 		 * received as a clone and is not currently an encryption root,
@@ -3451,7 +3463,7 @@ recv_fix_encryption_hierarchy(libzfs_handle_t *hdl, const char *top_zfs,
 				}
 			}
 
-			stream_keylocation = fnvlist_lookup_string(props,
+			stream_keylocation = fnvlist_lookup_string(stream_props,
 			    zfs_prop_to_name(ZFS_PROP_KEYLOCATION));
 
 			/*
@@ -3518,14 +3530,14 @@ recv_incremental_replication(libzfs_handle_t *hdl, const char *tofs,
 	boolean_t needagain, progress, recursive;
 	const char *s1, *s2;
 
+	if (flags->dryrun)
+		return (0);
+
 	fromsnap = fnvlist_lookup_string(stream_nv, "fromsnap");
 
 	recursive = (nvlist_lookup_boolean(stream_nv, "not_recursive") ==
 	    ENOENT);
 
-	if (flags->dryrun)
-		return (0);
-
 again:
 	needagain = progress = B_FALSE;
 
@@ -3999,9 +4011,9 @@ zfs_receive_package(libzfs_handle_t *hdl, int fd, const char *destname,
 		    stream_nv, stream_avl, NULL);
 	}
 
-	if (raw && softerr == 0 && *top_zfs != NULL) {
+	if (raw && *top_zfs != NULL && !flags->dryrun) {
 		softerr = recv_fix_encryption_hierarchy(hdl, *top_zfs,
-		    stream_nv);
+		    stream_nv, stream_avl);
 	}
 
 out:
diff --git a/tests/zfs-tests/tests/functional/rsend/send_encrypted_hierarchy.ksh b/tests/zfs-tests/tests/functional/rsend/send_encrypted_hierarchy.ksh
index 8417afc88d33..6dd4ae46f947 100755
--- a/tests/zfs-tests/tests/functional/rsend/send_encrypted_hierarchy.ksh
+++ b/tests/zfs-tests/tests/functional/rsend/send_encrypted_hierarchy.ksh
@@ -61,16 +61,17 @@ log_must eval "zfs receive -d -F $POOL2 < $BACKDIR/fs-before-R"
 dstds=$(get_dst_ds $POOL/$FS $POOL2)
 log_must cmp_ds_subs $POOL/$FS $dstds
 
-log_must verify_encryption_root $POOL/$FS $POOL/$FS
-log_must verify_keylocation $POOL/$FS "prompt"
-log_must verify_origin $POOL/$FS "-"
+log_must verify_encryption_root $POOL2/$FS $POOL2/$FS
+log_must verify_keylocation $POOL2/$FS "prompt"
+log_must verify_origin $POOL2/$FS "-"
 
-log_must verify_encryption_root $POOL/clone $POOL/$FS
-log_must verify_keylocation $POOL/clone "none"
-log_must verify_origin $POOL/clone "$POOL/$FS@snap"
+log_must verify_encryption_root $POOL2/clone $POOL2/$FS
+log_must verify_keylocation $POOL2/clone "none"
+log_must verify_origin $POOL2/clone "$POOL2/$FS@snap"
 
 log_must verify_encryption_root $POOL/$FS/child $POOL/$FS
-log_must verify_keylocation $POOL/$FS/child "none"
+log_must verify_encryption_root $POOL2/$FS/child $POOL2/$FS
+log_must verify_keylocation $POOL2/$FS/child "none"
 
 # Alter the hierarchy and re-send
 log_must eval "echo $PASSPHRASE1 | zfs change-key -o keyformat=passphrase" \
@@ -93,4 +94,20 @@ log_must verify_origin $POOL/clone "-"
 log_must verify_encryption_root $POOL/$FS/child $POOL/$FS/child
 log_must verify_keylocation $POOL/$FS/child "prompt"
 
+log_must verify_encryption_root $POOL2 "-"
+log_must verify_encryption_root $POOL2/clone $POOL2/clone
+log_must verify_encryption_root $POOL2/$FS $POOL2/clone
+log_must verify_encryption_root $POOL2/$FS/child $POOL2/$FS/child
+
+log_must verify_keylocation $POOL2 "none"
+log_must verify_keylocation $POOL2/clone "prompt"
+log_must verify_keylocation $POOL2/$FS "none"
+log_must verify_keylocation $POOL2/$FS/child "prompt"
+
+log_must verify_origin $POOL2 "-"
+log_must verify_origin $POOL2/clone "-"
+log_must verify_origin $POOL2/$FS "$POOL2/clone@snap"
+log_must verify_origin $POOL2/$FS/child "-"
+log_must zfs list
+
 log_pass "Raw recursive sends preserve filesystem structure."