diff --git a/packages/compiler-core/__tests__/transforms/__snapshots__/vMemo.spec.ts.snap b/packages/compiler-core/__tests__/transforms/__snapshots__/vMemo.spec.ts.snap
index 86e0b3d2fd5..8b536c50b97 100644
--- a/packages/compiler-core/__tests__/transforms/__snapshots__/vMemo.spec.ts.snap
+++ b/packages/compiler-core/__tests__/transforms/__snapshots__/vMemo.spec.ts.snap
@@ -5,13 +5,14 @@ exports[`compiler: v-memo transform > element v-for key expression prefixing + v
 
 export function render(_ctx, _cache) {
   return (_openBlock(), _createElementBlock("div", null, [
-    (_openBlock(true), _createElementBlock(_Fragment, null, _renderList(_ctx.tableData, (data, __, ___, _cached) => {
+    (_openBlock(true), _createElementBlock(_Fragment, null, _renderList(_ctx.tableData, (data, __, _i, _cached) => {
       const _memo = (_ctx.getLetter(data))
-      if (_cached && _cached.key === _ctx.getId(data) && _isMemoSame(_cached, _memo)) return _cached
+      if (_cached && _cached.el && _cached.key === _ctx.getId(data) && _isMemoSame(_cached, _memo)) return _cached
       const _item = (_openBlock(), _createElementBlock("span", {
         key: _ctx.getId(data)
       }))
       _item.memo = _memo
+      _item.cacheIndex = [0, _i]
       return _item
     }, _cache, 0), 128 /* KEYED_FRAGMENT */))
   ]))
@@ -53,11 +54,12 @@ exports[`compiler: v-memo transform > on template v-for 1`] = `
 
 export function render(_ctx, _cache) {
   return (_openBlock(), _createElementBlock("div", null, [
-    (_openBlock(true), _createElementBlock(_Fragment, null, _renderList(_ctx.list, ({ x, y }, __, ___, _cached) => {
+    (_openBlock(true), _createElementBlock(_Fragment, null, _renderList(_ctx.list, ({ x, y }, __, _i, _cached) => {
       const _memo = ([x, y === _ctx.z])
-      if (_cached && _cached.key === x && _isMemoSame(_cached, _memo)) return _cached
+      if (_cached && _cached.el && _cached.key === x && _isMemoSame(_cached, _memo)) return _cached
       const _item = (_openBlock(), _createElementBlock("span", { key: x }, "foobar"))
       _item.memo = _memo
+      _item.cacheIndex = [0, _i]
       return _item
     }, _cache, 0), 128 /* KEYED_FRAGMENT */))
   ]))
@@ -69,13 +71,14 @@ exports[`compiler: v-memo transform > on v-for 1`] = `
 
 export function render(_ctx, _cache) {
   return (_openBlock(), _createElementBlock("div", null, [
-    (_openBlock(true), _createElementBlock(_Fragment, null, _renderList(_ctx.list, ({ x, y }, __, ___, _cached) => {
+    (_openBlock(true), _createElementBlock(_Fragment, null, _renderList(_ctx.list, ({ x, y }, __, _i, _cached) => {
       const _memo = ([x, y === _ctx.z])
-      if (_cached && _cached.key === x && _isMemoSame(_cached, _memo)) return _cached
+      if (_cached && _cached.el && _cached.key === x && _isMemoSame(_cached, _memo)) return _cached
       const _item = (_openBlock(), _createElementBlock("div", { key: x }, [
         _createElementVNode("span", null, "foobar")
       ]))
       _item.memo = _memo
+      _item.cacheIndex = [0, _i]
       return _item
     }, _cache, 0), 128 /* KEYED_FRAGMENT */))
   ]))
diff --git a/packages/compiler-core/src/transforms/vFor.ts b/packages/compiler-core/src/transforms/vFor.ts
index 0dca0ba9ab4..664909443a5 100644
--- a/packages/compiler-core/src/transforms/vFor.ts
+++ b/packages/compiler-core/src/transforms/vFor.ts
@@ -218,6 +218,7 @@ export const transformFor: NodeTransform = createStructuralDirectiveTransform(
         }
 
         if (memo) {
+          forNode.parseResult.index = createSimpleExpression('_i')
           const loop = createFunctionExpression(
             createForLoopParams(forNode.parseResult, [
               createSimpleExpression(`_cached`),
@@ -226,7 +227,7 @@ export const transformFor: NodeTransform = createStructuralDirectiveTransform(
           loop.body = createBlockStatement([
             createCompoundExpression([`const _memo = (`, memo.exp!, `)`]),
             createCompoundExpression([
-              `if (_cached`,
+              `if (_cached && _cached.el`,
               ...(keyExp ? [` && _cached.key === `, keyExp] : []),
               ` && ${context.helperString(
                 IS_MEMO_SAME,
@@ -234,6 +235,9 @@ export const transformFor: NodeTransform = createStructuralDirectiveTransform(
             ]),
             createCompoundExpression([`const _item = `, childBlock as any]),
             createSimpleExpression(`_item.memo = _memo`),
+            createSimpleExpression(
+              `_item.cacheIndex = [${context.cached.length}, _i]`,
+            ),
             createSimpleExpression(`return _item`),
           ])
           renderExp.arguments.push(
diff --git a/packages/runtime-core/__tests__/helpers/withMemo.spec.ts b/packages/runtime-core/__tests__/helpers/withMemo.spec.ts
index 32f89b1d8e9..cc447327e39 100644
--- a/packages/runtime-core/__tests__/helpers/withMemo.spec.ts
+++ b/packages/runtime-core/__tests__/helpers/withMemo.spec.ts
@@ -204,6 +204,32 @@ describe('v-memo', () => {
     )
   })
 
+  // #12708
+  test('v-memo should work correctly when toggling v-if with v-for inside', async () => {
+    const [el, vm] = mount({
+      template: `<span v-if="show">
+          <span v-for="elem in [1]" :key="elem" v-memo="[count]">{{count}}</span>
+        </span>`,
+      data: () => ({
+        show: true,
+        count: 0,
+      }),
+    })
+    expect(el.innerHTML).toBe(`<span><span>0</span></span>`)
+
+    vm.show = false
+    await nextTick()
+    expect(el.innerHTML).toBe(`<!--v-if-->`)
+
+    vm.show = true
+    await nextTick()
+    expect(el.innerHTML).toBe(`<span><span>0</span></span>`)
+
+    vm.count++
+    await nextTick()
+    expect(el.innerHTML).toBe(`<span><span>1</span></span>`)
+  })
+
   test('on v-for /w constant expression ', async () => {
     const [el, vm] = mount({
       template: `<div v-for="item in 3"  v-memo="[count < 2 ? true : count]">
diff --git a/packages/runtime-core/src/helpers/renderList.ts b/packages/runtime-core/src/helpers/renderList.ts
index bbcbcc13044..3b4a8c2fa40 100644
--- a/packages/runtime-core/src/helpers/renderList.ts
+++ b/packages/runtime-core/src/helpers/renderList.ts
@@ -78,7 +78,7 @@ export function renderList(
       ret[i] = renderItem(
         needsWrap ? toReactive(source[i]) : source[i],
         i,
-        undefined,
+        i,
         cached && cached[i],
       )
     }
@@ -88,12 +88,12 @@ export function renderList(
     }
     ret = new Array(source)
     for (let i = 0; i < source; i++) {
-      ret[i] = renderItem(i + 1, i, undefined, cached && cached[i])
+      ret[i] = renderItem(i + 1, i, i, cached && cached[i])
     }
   } else if (isObject(source)) {
     if (source[Symbol.iterator as any]) {
       ret = Array.from(source as Iterable<any>, (item, i) =>
-        renderItem(item, i, undefined, cached && cached[i]),
+        renderItem(item, i, i, cached && cached[i]),
       )
     } else {
       const keys = Object.keys(source)
diff --git a/packages/runtime-core/src/renderer.ts b/packages/runtime-core/src/renderer.ts
index 90cc22f5470..ee3c2167d7f 100644
--- a/packages/runtime-core/src/renderer.ts
+++ b/packages/runtime-core/src/renderer.ts
@@ -2097,7 +2097,15 @@ function baseCreateRenderer(
 
     // #6593 should clean memo cache when unmount
     if (cacheIndex != null) {
-      parentComponent!.renderCache[cacheIndex] = undefined
+      if (isArray(cacheIndex)) {
+        const [parentIndex, itemIndex] = cacheIndex
+        const parentCache = parentComponent!.renderCache[
+          parentIndex
+        ]! as unknown as VNode[]
+        parentCache[itemIndex].el = null
+      } else {
+        parentComponent!.renderCache[cacheIndex] = undefined
+      }
     }
 
     if (shapeFlag & ShapeFlags.COMPONENT_SHOULD_KEEP_ALIVE) {
diff --git a/packages/runtime-core/src/vnode.ts b/packages/runtime-core/src/vnode.ts
index a8c5340cd1f..34aea8f79cb 100644
--- a/packages/runtime-core/src/vnode.ts
+++ b/packages/runtime-core/src/vnode.ts
@@ -243,8 +243,9 @@ export interface VNode<
   memo?: any[]
   /**
    * @internal index for cleaning v-memo cache
+   * cacheIndex will be an array when vnode in vFor + vMemo
    */
-  cacheIndex?: number
+  cacheIndex?: number | number[]
   /**
    * @internal __COMPAT__ only
    */