diff --git a/CHANGES.rst b/CHANGES.rst
index 7bedf3729..47eca0005 100644
--- a/CHANGES.rst
+++ b/CHANGES.rst
@@ -14,6 +14,10 @@ In development
   results or errors.
   https://github.com/joblib/joblib/pull/1055
 
+- Prevent a dask.distributed bug from surfacing in joblib's dask backend
+  during nested Parallel calls (due to joblib's auto-scattering feature)
+  https://github.com/joblib/joblib/pull/1061
+
 Release 0.15.1
 --------------
 
diff --git a/joblib/_dask.py b/joblib/_dask.py
index f4d91512b..e69b15b92 100644
--- a/joblib/_dask.py
+++ b/joblib/_dask.py
@@ -269,15 +269,22 @@ async def maybe_to_futures(args):
                     try:
                         f = call_data_futures[arg]
                     except KeyError:
+                        pass
+                    if f is None:
                         if is_weakrefable(arg) and sizeof(arg) > 1e3:
                             # Automatically scatter large objects to some of
                             # the workers to avoid duplicated data transfers.
                             # Rely on automated inter-worker data stealing if
                             # more workers need to reuse this data
                             # concurrently.
+                            # set hash=False - nested scatter calls (i.e
+                            # calling client.scatter inside a dask worker)
+                            # using hash=True often raise CancelledError,
+                            # see dask/distributed#3703
                             [f] = await self.client.scatter(
                                 [arg],
-                                asynchronous=True
+                                asynchronous=True,
+                                hash=False
                             )
                             call_data_futures[arg] = f
 
diff --git a/joblib/test/test_dask.py b/joblib/test/test_dask.py
index b1e51f6a8..6af0a0a4e 100644
--- a/joblib/test/test_dask.py
+++ b/joblib/test/test_dask.py
@@ -11,7 +11,7 @@
 from .._dask import DaskDistributedBackend
 
 distributed = pytest.importorskip('distributed')
-from distributed import Client, LocalCluster
+from distributed import Client, LocalCluster, get_client
 from distributed.metrics import time
 from distributed.utils_test import cluster, inc
 
@@ -251,6 +251,36 @@ def test_auto_scatter(loop):
             assert counts[b['address']] == 0
 
 
+@pytest.mark.parametrize("retry_no", list(range(2)))
+def test_nested_scatter(loop, retry_no):
+
+    np = pytest.importorskip('numpy')
+
+    NUM_INNER_TASKS = 10
+    NUM_OUTER_TASKS = 10
+
+    def my_sum(x, i, j):
+        return np.sum(x)
+
+    def outer_function_joblib(array, i):
+        client = get_client()  # noqa
+        with parallel_backend("dask"):
+            results = Parallel()(
+                delayed(my_sum)(array[j:], i, j) for j in range(
+                    NUM_INNER_TASKS)
+            )
+        return sum(results)
+
+    with cluster() as (s, [a, b]):
+        with Client(s['address'], loop=loop) as _:
+            with parallel_backend("dask"):
+                my_array = np.ones(10000)
+                _ = Parallel()(
+                    delayed(outer_function_joblib)(
+                        my_array[i:], i) for i in range(NUM_OUTER_TASKS)
+                )
+
+
 def test_nested_backend_context_manager(loop):
     def get_nested_pids():
         pids = set(Parallel(n_jobs=2)(delayed(os.getpid)() for _ in range(2)))