diff --git a/mongoengine/base/document.py b/mongoengine/base/document.py
index 46935c1b8..6be7e8226 100644
--- a/mongoengine/base/document.py
+++ b/mongoengine/base/document.py
@@ -470,6 +470,14 @@ def __expand_dynamic_values(self, name, value):
         # If the value is a dict with '_cls' in it, turn it into a document
         is_dict = isinstance(value, dict)
         if is_dict and "_cls" in value:
+
+            # If the value is a referenced document, dereference it
+            if "_ref" in value:
+                _dereference = _import_class("DeReference")()
+                documents = _dereference([value])
+                if documents:
+                    return documents[0]
+
             cls = get_document(value["_cls"])
             return cls(**value)
 
diff --git a/tests/test_dereference.py b/tests/test_dereference.py
index bddcc5432..f34ca71dd 100644
--- a/tests/test_dereference.py
+++ b/tests/test_dereference.py
@@ -1352,6 +1352,28 @@ class Page(Document):
         page = Page.objects.first()
         assert page.tags[0] == page.posts[0].tags[0]
 
+    def test_dereferencing_dynamic_embedded_field_referencefield(self):
+        class Tag(Document):
+            meta = {"collection": "tags"}
+            name = StringField()
+
+        class Post(DynamicEmbeddedDocument):
+            pass
+
+        class Page(Document):
+            meta = {"collection": "pages"}
+            post = EmbeddedDocumentField(Post)
+
+        Tag.drop_collection()
+        Page.drop_collection()
+
+        tag = Tag(name="test").save()
+        post = Post(book_tag=tag)
+        Page(post=post).save()
+
+        page = Page.objects.first()
+        assert page.post.book_tag == post.book_tag
+
     def test_select_related_follows_embedded_referencefields(self):
         class Song(Document):
             title = StringField()