diff --git a/package.json b/package.json
index 67bd26e8e..69dc9380a 100644
--- a/package.json
+++ b/package.json
@@ -47,6 +47,7 @@
 	},
 	"xo": {
 		"rules": {
+			"@typescript-eslint/no-extraneous-class": "off",
 			"@typescript-eslint/ban-ts-comment": "off",
 			"@typescript-eslint/ban-types": "off",
 			"@typescript-eslint/naming-convention": "off",
diff --git a/source/paths.d.ts b/source/paths.d.ts
index f7d18214c..97648272d 100644
--- a/source/paths.d.ts
+++ b/source/paths.d.ts
@@ -3,6 +3,8 @@ import type {EmptyObject} from './empty-object';
 import type {IsAny} from './is-any';
 import type {IsNever} from './is-never';
 import type {UnknownArray} from './unknown-array';
+import type {Sum} from './sum';
+import type {LessThan} from './less-than';
 
 /**
 Generate a union of all possible paths to properties in the given object.
@@ -45,7 +47,9 @@ open('listB.1'); // TypeError. Because listB only has one element.
 @category Object
 @category Array
 */
-export type Paths<T> =
+export type Paths<T> = Paths_<T>;
+
+type Paths_<T, Depth extends number = 0> =
 	T extends NonRecursiveType | ReadonlyMap<unknown, unknown> | ReadonlySet<unknown>
 		? never
 		: IsAny<T> extends true
@@ -53,14 +57,14 @@ export type Paths<T> =
 			: T extends UnknownArray
 				? number extends T['length']
 					// We need to handle the fixed and non-fixed index part of the array separately.
-					? InternalPaths<StaticPartOfArray<T>>
-					| InternalPaths<Array<VariablePartOfArray<T>[number]>>
-					: InternalPaths<T>
+					? InternalPaths<StaticPartOfArray<T>, Depth>
+					| InternalPaths<Array<VariablePartOfArray<T>[number]>, Depth>
+					: InternalPaths<T, Depth>
 				: T extends object
-					? InternalPaths<T>
+					? InternalPaths<T, Depth>
 					: never;
 
-export type InternalPaths<_T, T = Required<_T>> =
+export type InternalPaths<_T, Depth extends number = 0, T = Required<_T>> =
 	T extends EmptyObject | readonly []
 		? never
 		: {
@@ -71,8 +75,10 @@ export type InternalPaths<_T, T = Required<_T>> =
 				| Key
 				| ToString<Key>
 				| (
-					IsNever<Paths<T[Key]>> extends false
-						? `${Key}.${Paths<T[Key]>}`
+					LessThan<Depth, 15> extends true // Limit the depth to prevent infinite recursion
+						? IsNever<Paths_<T[Key], Sum<Depth, 1>>> extends false
+							? `${Key}.${Paths_<T[Key], Sum<Depth, 1>>}`
+							: never
 						: never
 				)
 				: never
diff --git a/test-d/paths.ts b/test-d/paths.ts
index 7d4b8657a..b1f151882 100644
--- a/test-d/paths.ts
+++ b/test-d/paths.ts
@@ -1,5 +1,5 @@
-import {expectType} from 'tsd';
-import type {Paths} from '../index';
+import {expectAssignable, expectType} from 'tsd';
+import type {Paths, PickDeep} from '../index';
 
 declare const normal: Paths<{foo: string}>;
 expectType<'foo'>(normal);
@@ -98,3 +98,13 @@ expectType<number | `${number}` | `${number}.b` | `${number}.a`>(leadingSpreadTu
 
 declare const leadingSpreadTuple1: Paths<[...Array<{a: string}>, {b: number}, {c: number}]>;
 expectType<number | `${number}` | `${number}.b` | `${number}.c` | `${number}.a`>(leadingSpreadTuple1);
+
+// Circularly references
+type MyEntity = {
+	myOtherEntity?: MyOtherEntity;
+};
+type MyOtherEntity = {
+	myEntity?: MyEntity;
+};
+type MyEntityPaths = Paths<MyEntity>;
+expectAssignable<string>({} as MyEntityPaths);