diff --git a/packages/block-editor/src/components/block-toolbar/style.scss b/packages/block-editor/src/components/block-toolbar/style.scss
index 6be586196f737..f34a4e69947ec 100644
--- a/packages/block-editor/src/components/block-toolbar/style.scss
+++ b/packages/block-editor/src/components/block-toolbar/style.scss
@@ -46,12 +46,25 @@
 
 .block-editor-block-contextual-toolbar.has-parent {
 	margin-left: calc(#{$grid-unit-60} + #{$grid-unit-10});
+
+	.show-icon-labels & {
+		margin-left: 0;
+	}
 }
 
 .block-editor-block-parent-selector {
 	position: absolute;
 	top: -$border-width;
 	left: calc(-#{$grid-unit-60} - #{$grid-unit-10} - #{$border-width});
+
+	.show-icon-labels & {
+		position: relative;
+		left: auto;
+		top: auto;
+		margin-top: -$border-width;
+		margin-left: -$border-width;
+		margin-bottom: -$border-width;
+	}
 }
 
 // Block controls.