diff --git a/src/renderers/dom/shared/ReactDOMComponent.js b/src/renderers/dom/shared/ReactDOMComponent.js
index ff1321851a..4e30c5f699 100644
--- a/src/renderers/dom/shared/ReactDOMComponent.js
+++ b/src/renderers/dom/shared/ReactDOMComponent.js
@@ -480,14 +480,12 @@ function validateDangerousTag(tag) {
   }
 }
 
-function processChildContext(context, inst) {
-  if (__DEV__) {
-    // Pass down our tag name to child components for validation purposes
-    context = assign({}, context);
-    var info = context[validateDOMNesting.ancestorInfoContextKey];
-    context[validateDOMNesting.ancestorInfoContextKey] =
-      validateDOMNesting.updatedAncestorInfo(info, inst._tag, inst);
-  }
+function processChildContextDev(context, inst) {
+  // Pass down our tag name to child components for validation purposes
+  context = assign({}, context);
+  var info = context[validateDOMNesting.ancestorInfoContextKey];
+  context[validateDOMNesting.ancestorInfoContextKey] =
+    validateDOMNesting.updatedAncestorInfo(info, inst._tag, inst);
   return context;
 }
 
@@ -519,6 +517,10 @@ function ReactDOMComponent(tag) {
   this._wrapperState = null;
   this._topLevelWrapper = null;
   this._nodeWithLegacyProperties = null;
+  if (__DEV__) {
+    this._unprocessedContextDev = null;
+    this._processedContextDev = null;
+  }
 }
 
 ReactDOMComponent.displayName = 'ReactDOMComponent';
@@ -588,6 +590,12 @@ ReactDOMComponent.Mixin = {
       }
     }
 
+    if (__DEV__) {
+      this._unprocessedContextDev = context;
+      this._processedContextDev = processChildContextDev(context, this);
+      context = this._processedContextDev;
+    }
+
     var mountImage;
     if (transaction.useCreateElement) {
       var ownerDocument = context[ReactMount.ownerDocumentContextKey];
@@ -721,7 +729,7 @@ ReactDOMComponent.Mixin = {
         var mountImages = this.mountChildren(
           childrenToUse,
           transaction,
-          processChildContext(context, this)
+          context
         );
         ret = mountImages.join('');
       }
@@ -761,7 +769,7 @@ ReactDOMComponent.Mixin = {
         var mountImages = this.mountChildren(
           childrenToUse,
           transaction,
-          processChildContext(context, this)
+          context
         );
         for (var i = 0; i < mountImages.length; i++) {
           el.appendChild(mountImages[i]);
@@ -823,13 +831,25 @@ ReactDOMComponent.Mixin = {
         break;
     }
 
+    if (__DEV__) {
+      // If the context is reference-equal to the old one, pass down the same
+      // processed object so the update bailout in ReactReconciler behaves
+      // correctly (and identically in dev and prod). See #5005.
+      if (this._unprocessedContextDev !== context) {
+        this._unprocessedContextDev = context;
+        this._processedContextDev = processChildContextDev(context, this);
+      }
+      context = this._processedContextDev;
+    }
+
+
     assertValidProps(this, nextProps);
     this._updateDOMProperties(lastProps, nextProps, transaction, null);
     this._updateDOMChildren(
       lastProps,
       nextProps,
       transaction,
-      processChildContext(context, this)
+      context
     );
 
     if (!canDefineProperty && this._nodeWithLegacyProperties) {
diff --git a/src/renderers/shared/reconciler/__tests__/ReactCompositeComponent-test.js b/src/renderers/shared/reconciler/__tests__/ReactCompositeComponent-test.js
index d0e25cbbf5..929d3e70eb 100644
--- a/src/renderers/shared/reconciler/__tests__/ReactCompositeComponent-test.js
+++ b/src/renderers/shared/reconciler/__tests__/ReactCompositeComponent-test.js
@@ -607,6 +607,29 @@ describe('ReactCompositeComponent', function() {
     expect(ReactDOM.findDOMNode(component).innerHTML).toBe('bar');
   });
 
+  it('should skip update when rerendering element in container', function() {
+    var Parent = React.createClass({
+      render: function() {
+        return <div>{this.props.children}</div>;
+      },
+    });
+
+    var childRenders = 0;
+    var Child = React.createClass({
+      render: function() {
+        childRenders++;
+        return <div />;
+      },
+    });
+
+    var container = document.createElement('div');
+    var child = <Child />;
+
+    ReactDOM.render(<Parent>{child}</Parent>, container);
+    ReactDOM.render(<Parent>{child}</Parent>, container);
+    expect(childRenders).toBe(1);
+  });
+
   it('should pass context when re-rendered for static child', function() {
     var parentInstance = null;
     var childInstance = null;