diff --git a/lib/galaxy/tool_shed/galaxy_install/tools/tool_panel_manager.py b/lib/galaxy/tool_shed/galaxy_install/tools/tool_panel_manager.py
index 8ddedec95cb..ccc933a7044 100644
--- a/lib/galaxy/tool_shed/galaxy_install/tools/tool_panel_manager.py
+++ b/lib/galaxy/tool_shed/galaxy_install/tools/tool_panel_manager.py
@@ -56,7 +56,22 @@ class ToolPanelManager:
                 config_elems.append(elem)
             # Add the new elements to the in-memory list of config_elems.
             for elem_entry in elem_list:
-                config_elems.append(elem_entry)
+                if elem_entry.tag == 'section':
+                    # Loop through section entries in the in-memory tool panel.
+                    for existing_elem in config_elems:
+                        # Compare the section ID for each one to the section ID for the tool being installed.
+                        if existing_elem.tag == 'section' and existing_elem.attrib.get('id', None) == elem_entry.attrib.get('id', None):
+                            # We've found a section, add the incoming tools to it.
+                            for child in elem_entry:
+                                existing_elem.append(child)
+                            # Break out of the config_elems loop back to the elem_list loop.
+                            break
+                    # If we reach this point, no section was found. Create one with contents.
+                    else:
+                        config_elems.append(elem_entry)
+                # This is not a section, but a tool or label. No need to search for matching sections, just add it.
+                else:
+                    config_elems.append(elem_entry)
             # Persist the altered shed_tool_config file.
             self.config_elems_to_xml_file(config_elems, shed_tool_conf, tool_path, tool_cache_data_dir)
             self.app.wait_for_toolbox_reload(old_toolbox)