diff --git a/doc/classes/Tree.xml b/doc/classes/Tree.xml
index 8a30364ebece..1b2186ef2b32 100644
--- a/doc/classes/Tree.xml
+++ b/doc/classes/Tree.xml
@@ -254,6 +254,14 @@
 				Causes the [Tree] to jump to the specified [TreeItem].
 			</description>
 		</method>
+		<method name="set_collapsed_all">
+			<return type="void" />
+			<argument index="0" name="collapsed" type="bool" />
+			<argument index="1" name="ignore_active_branches" type="bool" />
+			<description>
+				Collapses or uncollapses every [TreeItem] in the [Tree], recursively, starting from the root. If ignore_active_branches is [code]true[/code], the branch containing the currently selected TreeItem will be left in its current state.
+			</description>
+		</method>
 		<method name="set_column_clip_content">
 			<return type="void" />
 			<argument index="0" name="column" type="int" />
diff --git a/doc/classes/TreeItem.xml b/doc/classes/TreeItem.xml
index 0a680b9627af..54b77da50809 100644
--- a/doc/classes/TreeItem.xml
+++ b/doc/classes/TreeItem.xml
@@ -336,6 +336,12 @@
 				Returns the [Tree] that owns this TreeItem.
 			</description>
 		</method>
+		<method name="has_expanded_child">
+			<return type="bool" />
+			<description>
+				Returns [code]true[/code] if the [TreeItem] has at least one child which is not collapsed and has at least one child of it's own.
+			</description>
+		</method>
 		<method name="is_button_disabled" qualifiers="const">
 			<return type="bool" />
 			<argument index="0" name="column" type="int" />
@@ -364,6 +370,12 @@
 				Returns [code]true[/code] if column [code]column[/code] is editable.
 			</description>
 		</method>
+		<method name="is_in_active_branch">
+			<return type="bool" />
+			<description>
+				Returns [code]true[/code] if the [TreeItem] or at least one of it's descendent have at least one column selected.
+			</description>
+		</method>
 		<method name="is_indeterminate" qualifiers="const">
 			<return type="bool" />
 			<argument index="0" name="column" type="int" />
@@ -457,6 +469,17 @@
 				If [code]true[/code], the column [code]column[/code] is checked. Clears column's indeterminate status.
 			</description>
 		</method>
+		<method name="set_collapsed_recursive">
+			<return type="void" />
+			<argument index="0" name="enable" type="bool" />
+			<argument index="1" name="ignore_active_branches" type="bool" />
+			<argument index="2" name="ignore_self" type="bool" />
+			<description>
+				Recursively collapse this [TreeItem] and all its descendants when [code]enable[/code] is [code]true[/code], otherwise expanding them.
+				If [code]ignore_active_branches[/code] is [code]true[/code], branches which contains a selected [TreeItem] will be ignored.
+				If [code]ignore_self[/code] is [code]true[/code], only descendants are affected.
+			</description>
+		</method>
 		<method name="set_custom_as_button">
 			<return type="void" />
 			<argument index="0" name="column" type="int" />
@@ -671,9 +694,18 @@
 				Sets the given column's tooltip text.
 			</description>
 		</method>
+		<method name="toggle_collapsed_recursive">
+			<return type="void" />
+			<description>
+				If the [TreeItem] is already collapsed, expands it and all of its children recursively.
+				If the [TreeItem] is expanded and has at least one expanded child, collapses all children recursively without collapsing the current [TreeItem].
+				If the [TreeItem] is expanded and all children are collapsed, collapses the [TreeItem].
+			</description>
+		</method>
 		<method name="uncollapse_tree">
 			<return type="void" />
 			<description>
+				Uncollapses the [TreeItem] and all of it's ancestor.
 			</description>
 		</method>
 	</methods>
diff --git a/editor/debugger/script_editor_debugger.cpp b/editor/debugger/script_editor_debugger.cpp
index 408d6af02261..56c36d06008d 100644
--- a/editor/debugger/script_editor_debugger.cpp
+++ b/editor/debugger/script_editor_debugger.cpp
@@ -1439,29 +1439,11 @@ void ScriptEditorDebugger::_error_selected() {
 }
 
 void ScriptEditorDebugger::_expand_errors_list() {
-	TreeItem *root = error_tree->get_root();
-	if (!root) {
-		return;
-	}
-
-	TreeItem *item = root->get_first_child();
-	while (item) {
-		item->set_collapsed(false);
-		item = item->get_next();
-	}
+	error_tree->set_collapsed_all(false, false);
 }
 
 void ScriptEditorDebugger::_collapse_errors_list() {
-	TreeItem *root = error_tree->get_root();
-	if (!root) {
-		return;
-	}
-
-	TreeItem *item = root->get_first_child();
-	while (item) {
-		item->set_collapsed(true);
-		item = item->get_next();
-	}
+	error_tree->set_collapsed_all(true, false);
 }
 
 void ScriptEditorDebugger::_clear_errors_list() {
diff --git a/editor/plugins/visual_shader_editor_plugin.cpp b/editor/plugins/visual_shader_editor_plugin.cpp
index 8c72a886ea72..1b47990d89b1 100644
--- a/editor/plugins/visual_shader_editor_plugin.cpp
+++ b/editor/plugins/visual_shader_editor_plugin.cpp
@@ -4356,31 +4356,10 @@ void VisualShaderEditor::_tools_menu_option(int p_idx) {
 
 	switch (p_idx) {
 		case EXPAND_ALL:
-
-			while (category) {
-				category->set_collapsed(false);
-				TreeItem *sub_category = category->get_first_child();
-				while (sub_category) {
-					sub_category->set_collapsed(false);
-					sub_category = sub_category->get_next();
-				}
-				category = category->get_next();
-			}
-
+			category->set_collapsed_recursive(false, false, false);
 			break;
-
 		case COLLAPSE_ALL:
-
-			while (category) {
-				category->set_collapsed(true);
-				TreeItem *sub_category = category->get_first_child();
-				while (sub_category) {
-					sub_category->set_collapsed(true);
-					sub_category = sub_category->get_next();
-				}
-				category = category->get_next();
-			}
-
+			category->set_collapsed_recursive(true, false, false);
 			break;
 		default:
 			break;
diff --git a/editor/scene_tree_dock.cpp b/editor/scene_tree_dock.cpp
index 2e1090e6c0e6..7500f29e8552 100644
--- a/editor/scene_tree_dock.cpp
+++ b/editor/scene_tree_dock.cpp
@@ -438,8 +438,8 @@ void SceneTreeDock::_tool_selected(int p_tool, bool p_confirm_override) {
 				}
 			}
 
-			bool collapsed = _is_collapsed_recursive(selected_item);
-			_set_collapsed_recursive(selected_item, !collapsed);
+			bool collapse = selected_item->has_expanded_child();
+			selected_item->set_collapsed_recursive(collapse, false, false);
 
 			tree->ensure_cursor_is_visible();
 
@@ -1175,17 +1175,6 @@ void SceneTreeDock::add_root_node(Node *p_node) {
 	editor_data->get_undo_redo().commit_action();
 }
 
-void SceneTreeDock::_node_collapsed(Object *p_obj) {
-	TreeItem *ti = Object::cast_to<TreeItem>(p_obj);
-	if (!ti) {
-		return;
-	}
-
-	if (Input::get_singleton()->is_key_pressed(Key::SHIFT)) {
-		_set_collapsed_recursive(ti, ti->is_collapsed());
-	}
-}
-
 void SceneTreeDock::_notification(int p_what) {
 	switch (p_what) {
 		case NOTIFICATION_READY: {
@@ -1903,48 +1892,6 @@ void SceneTreeDock::_do_reparent(Node *p_new_parent, int p_position_in_parent, V
 	editor_data->get_undo_redo().commit_action();
 }
 
-bool SceneTreeDock::_is_collapsed_recursive(TreeItem *p_item) const {
-	bool is_branch_collapsed = false;
-
-	List<TreeItem *> needs_check;
-	needs_check.push_back(p_item);
-
-	while (!needs_check.is_empty()) {
-		TreeItem *item = needs_check.back()->get();
-		needs_check.pop_back();
-
-		TreeItem *child = item->get_first_child();
-		is_branch_collapsed = item->is_collapsed() && child;
-
-		if (is_branch_collapsed) {
-			break;
-		}
-		while (child) {
-			needs_check.push_back(child);
-			child = child->get_next();
-		}
-	}
-	return is_branch_collapsed;
-}
-
-void SceneTreeDock::_set_collapsed_recursive(TreeItem *p_item, bool p_collapsed) {
-	List<TreeItem *> to_collapse;
-	to_collapse.push_back(p_item);
-
-	while (!to_collapse.is_empty()) {
-		TreeItem *item = to_collapse.back()->get();
-		to_collapse.pop_back();
-
-		item->set_collapsed(p_collapsed);
-
-		TreeItem *child = item->get_first_child();
-		while (child) {
-			to_collapse.push_back(child);
-			child = child->get_next();
-		}
-	}
-}
-
 void SceneTreeDock::_script_created(Ref<Script> p_script) {
 	List<Node *> selected = editor_selection->get_selected_node_list();
 
@@ -3465,7 +3412,6 @@ SceneTreeDock::SceneTreeDock(Node *p_scene_root, EditorSelection *p_editor_selec
 	scene_tree->connect("nodes_dragged", callable_mp(this, &SceneTreeDock::_nodes_drag_begin));
 
 	scene_tree->get_scene_tree()->connect("item_double_clicked", callable_mp(this, &SceneTreeDock::_focus_node));
-	scene_tree->get_scene_tree()->connect("item_collapsed", callable_mp(this, &SceneTreeDock::_node_collapsed));
 
 	editor_selection->connect("selection_changed", callable_mp(this, &SceneTreeDock::_selection_changed));
 
diff --git a/editor/scene_tree_dock.h b/editor/scene_tree_dock.h
index dc7f3476ee86..468d7fb17c29 100644
--- a/editor/scene_tree_dock.h
+++ b/editor/scene_tree_dock.h
@@ -133,7 +133,6 @@ class SceneTreeDock : public VBoxContainer {
 	HBoxContainer *tool_hbc = nullptr;
 	void _tool_selected(int p_tool, bool p_confirm_override = false);
 	void _property_selected(int p_idx);
-	void _node_collapsed(Object *p_obj);
 
 	Node *property_drop_node = nullptr;
 	String resource_drop_path;
@@ -184,9 +183,6 @@ class SceneTreeDock : public VBoxContainer {
 	void _node_reparent(NodePath p_path, bool p_keep_global_xform);
 	void _do_reparent(Node *p_new_parent, int p_position_in_parent, Vector<Node *> p_nodes, bool p_keep_global_xform);
 
-	bool _is_collapsed_recursive(TreeItem *p_item) const;
-	void _set_collapsed_recursive(TreeItem *p_item, bool p_collapsed);
-
 	void _set_owners(Node *p_owner, const Array &p_nodes);
 
 	enum ReplaceOwnerMode {
diff --git a/scene/gui/tree.cpp b/scene/gui/tree.cpp
index d3e7540790d3..979b6795a201 100644
--- a/scene/gui/tree.cpp
+++ b/scene/gui/tree.cpp
@@ -540,6 +540,54 @@ void TreeItem::set_collapsed(bool p_collapsed) {
 	tree->emit_signal(SNAME("item_collapsed"), this);
 }
 
+void TreeItem::set_collapsed_recursive(bool p_collapsed, bool p_ignore_active_branches, bool p_ignore_self) {
+	if (!tree) {
+		return;
+	}
+
+	if (p_ignore_self || (p_ignore_active_branches && this->has_expanded_child())) {
+		// Ignore current item, collapse all children recursively.
+		TreeItem *child = get_first_child();
+		while (child) {
+			child->set_collapsed_recursive(p_collapsed, p_ignore_active_branches, false);
+			child = child->get_next();
+		}
+	} else {
+		// Set collapsed state on self and all children recursively.
+		const Variant arg_collapsed[] = { Variant(p_collapsed) };
+		const Variant *args[] = { arg_collapsed };
+		Callable::CallError error;
+		call_recursive("set_collapsed", args, 1, error);
+	}
+}
+
+void TreeItem::toggle_collapsed_recursive() {
+	if (is_collapsed()) {
+		// Expand current TreeItem and its children, no need to validate children state.
+		// We don't want to recursively collapse children of an already collapsed node.
+		set_collapsed_recursive(false, false, false);
+	} else if (has_expanded_child()) {
+		// Collapse all children recursively, ignore self.
+		set_collapsed_recursive(true, false, true);
+	} else {
+		// All children already collapsed, collapse self.
+		set_collapsed(true);
+	}
+}
+
+bool TreeItem::has_expanded_child() {
+	TreeItem *child = get_first_child();
+
+	while (child) {
+		if (!child->is_collapsed() && child->get_first_child()) {
+			return true;
+		}
+		child = child->get_next();
+	}
+
+	return false;
+}
+
 bool TreeItem::is_collapsed() {
 	return collapsed;
 }
@@ -902,6 +950,25 @@ bool TreeItem::is_selected(int p_column) {
 	return cells[p_column].selectable && cells[p_column].selected;
 }
 
+bool TreeItem::is_in_active_branch() {
+	TreeItem *selected = tree->get_selected();
+	if (!selected) {
+		return false;
+	} else if (selected == this) {
+		return true;
+	}
+
+	TreeItem *child = get_first_child();
+	while (child) {
+		if (child->is_in_active_branch()) {
+			return true;
+		}
+		child = child->get_next();
+	}
+
+	return false;
+}
+
 void TreeItem::set_as_cursor(int p_column) {
 	ERR_FAIL_INDEX(p_column, cells.size());
 	if (!tree) {
@@ -1308,13 +1375,15 @@ void TreeItem::_bind_methods() {
 	ClassDB::bind_method(D_METHOD("set_custom_draw", "column", "object", "callback"), &TreeItem::set_custom_draw);
 
 	ClassDB::bind_method(D_METHOD("set_collapsed", "enable"), &TreeItem::set_collapsed);
+	ClassDB::bind_method(D_METHOD("set_collapsed_recursive", "enable", "ignore_active_branches", "ignore_self"), &TreeItem::set_collapsed_recursive);
+	ClassDB::bind_method(D_METHOD("toggle_collapsed_recursive"), &TreeItem::toggle_collapsed_recursive);
+	ClassDB::bind_method(D_METHOD("uncollapse_tree"), &TreeItem::uncollapse_tree);
 	ClassDB::bind_method(D_METHOD("is_collapsed"), &TreeItem::is_collapsed);
+	ClassDB::bind_method(D_METHOD("has_expanded_child"), &TreeItem::has_expanded_child);
 
 	ClassDB::bind_method(D_METHOD("set_visible", "enable"), &TreeItem::set_visible);
 	ClassDB::bind_method(D_METHOD("is_visible"), &TreeItem::is_visible);
 
-	ClassDB::bind_method(D_METHOD("uncollapse_tree"), &TreeItem::uncollapse_tree);
-
 	ClassDB::bind_method(D_METHOD("set_custom_minimum_height", "height"), &TreeItem::set_custom_minimum_height);
 	ClassDB::bind_method(D_METHOD("get_custom_minimum_height"), &TreeItem::get_custom_minimum_height);
 
@@ -2463,8 +2532,14 @@ int Tree::propagate_mouse_event(const Point2i &p_pos, int x_ofs, int y_ofs, int
 			return -1;
 		}
 
+		// Clicked on folding arrow
 		if (!p_item->disable_folding && !hide_folding && p_item->first_child && (p_pos.x >= x_ofs && p_pos.x < (x_ofs + cache.item_margin))) {
-			p_item->set_collapsed(!p_item->is_collapsed());
+			if (p_mod->is_alt_pressed()) {
+				// ALT -> Apply on children, recursively
+				p_item->toggle_collapsed_recursive();
+			} else {
+				p_item->set_collapsed(!p_item->is_collapsed());
+			}
 			return -1;
 		}
 
@@ -2515,7 +2590,12 @@ int Tree::propagate_mouse_event(const Point2i &p_pos, int x_ofs, int y_ofs, int
 		}
 
 		if (!p_item->disable_folding && !hide_folding && !p_item->cells[col].editable && !p_item->cells[col].selectable && p_item->get_first_child()) {
-			p_item->set_collapsed(!p_item->is_collapsed());
+			if (p_mod->is_alt_pressed()) {
+				// ALT -> Apply recursively
+				p_item->toggle_collapsed_recursive();
+			} else {
+				p_item->set_collapsed(!p_item->is_collapsed());
+			}
 			return -1; //collapse/uncollapse because nothing can be done with item
 		}
 
@@ -3017,12 +3097,7 @@ void Tree::gui_input(const Ref<InputEvent> &p_event) {
 			return;
 		}
 		if (k.is_valid() && k->is_alt_pressed()) {
-			selected_item->set_collapsed(false);
-			TreeItem *next = selected_item->get_first_child();
-			while (next && next != selected_item->next) {
-				next->set_collapsed(false);
-				next = next->get_next_visible();
-			}
+			selected_item->set_collapsed_recursive(false, false, false);
 		} else {
 			_go_right();
 		}
@@ -3036,12 +3111,7 @@ void Tree::gui_input(const Ref<InputEvent> &p_event) {
 		}
 
 		if (k.is_valid() && k->is_alt_pressed()) {
-			selected_item->set_collapsed(true);
-			TreeItem *next = selected_item->get_first_child();
-			while (next && next != selected_item->next) {
-				next->set_collapsed(true);
-				next = next->get_next_visible();
-			}
+			selected_item->set_collapsed_recursive(true, false, false);
 		} else {
 			_go_left();
 		}
@@ -4935,6 +5005,12 @@ bool Tree::get_allow_reselect() const {
 	return allow_reselect;
 }
 
+void Tree::set_collapsed_all(bool p_collapsed, bool p_ignore_active_branches) {
+	bool skip_root = is_root_hidden();
+	get_root()->set_collapsed_recursive(p_collapsed, p_ignore_active_branches, skip_root);
+	ensure_cursor_is_visible();
+}
+
 void Tree::_bind_methods() {
 	ClassDB::bind_method(D_METHOD("clear"), &Tree::clear);
 	ClassDB::bind_method(D_METHOD("create_item", "parent", "idx"), &Tree::create_item, DEFVAL(Variant()), DEFVAL(-1));
@@ -5011,6 +5087,9 @@ void Tree::_bind_methods() {
 	ClassDB::bind_method(D_METHOD("set_allow_reselect", "allow"), &Tree::set_allow_reselect);
 	ClassDB::bind_method(D_METHOD("get_allow_reselect"), &Tree::get_allow_reselect);
 
+	ClassDB::bind_method(D_METHOD("set_collapsed_all", "collapsed", "ignore_active_branches"), &Tree::set_collapsed_all);
+
+
 	ADD_PROPERTY(PropertyInfo(Variant::INT, "columns"), "set_columns", "get_columns");
 	ADD_PROPERTY(PropertyInfo(Variant::BOOL, "column_titles_visible"), "set_column_titles_visible", "are_column_titles_visible");
 	ADD_PROPERTY(PropertyInfo(Variant::BOOL, "allow_reselect"), "set_allow_reselect", "get_allow_reselect");
diff --git a/scene/gui/tree.h b/scene/gui/tree.h
index 0a8dd3204abb..51d78f803ea6 100644
--- a/scene/gui/tree.h
+++ b/scene/gui/tree.h
@@ -275,13 +275,15 @@ class TreeItem : public Object {
 	void set_custom_draw(int p_column, Object *p_object, const StringName &p_callback);
 
 	void set_collapsed(bool p_collapsed);
+	void set_collapsed_recursive(bool p_collapsed, bool p_ignore_active_branches, bool p_ignore_self);
+	void toggle_collapsed_recursive();
+	void uncollapse_tree();
 	bool is_collapsed();
+	bool has_expanded_child();
 
 	void set_visible(bool p_visible);
 	bool is_visible();
 
-	void uncollapse_tree();
-
 	void set_custom_minimum_height(int p_height);
 	int get_custom_minimum_height() const;
 
@@ -289,6 +291,7 @@ class TreeItem : public Object {
 	bool is_selectable(int p_column) const;
 
 	bool is_selected(int p_column);
+	bool is_in_active_branch();
 	void select(int p_column);
 	void deselect(int p_column);
 	void set_as_cursor(int p_column);
@@ -719,6 +722,8 @@ class Tree : public Control {
 	void set_allow_reselect(bool p_allow);
 	bool get_allow_reselect() const;
 
+	void set_collapsed_all(bool p_collapsed, bool p_ignore_active_branches);
+
 	Size2 get_minimum_size() const override;
 
 	Tree();