diff --git a/engine/include/cubos/engine/transform/plugin.hpp b/engine/include/cubos/engine/transform/plugin.hpp
index a3bee01b6b..a0b8f8c581 100644
--- a/engine/include/cubos/engine/transform/plugin.hpp
+++ b/engine/include/cubos/engine/transform/plugin.hpp
@@ -44,8 +44,10 @@ namespace cubos::engine
     /// Position, @ref Rotation or @ref Scale components.
     /// - `cubos.transform.missing` - the @ref Position, @ref Rotation, @ref Scale and possibly @ref LocalToParent
     /// components are added to entities with @ref LocalToWorld components.
+    /// - `cubos.transform.update.relative` - the @ref LocalToWorld or @ref LocalToParent components are updated with
+    /// the information from the @ref Position, @ref Rotation and @ref Scale components.
     /// - `cubos.transform.update` - the @ref LocalToWorld components are updated with the information from the @ref
-    /// Position, @ref Rotation and @ref Scale components.
+    /// LocalToParent component and the @ref LocalToWorld components of the parent.
 
     /// @brief Plugin entry function.
     /// @param cubos @b CUBOS. main class
diff --git a/engine/src/cubos/engine/transform/plugin.cpp b/engine/src/cubos/engine/transform/plugin.cpp
index 800d4b652e..66f3a12a15 100644
--- a/engine/src/cubos/engine/transform/plugin.cpp
+++ b/engine/src/cubos/engine/transform/plugin.cpp
@@ -1,5 +1,7 @@
 #include <cubos/engine/transform/plugin.hpp>
 
+using cubos::core::ecs::Traversal;
+
 void cubos::engine::transformPlugin(Cubos& cubos)
 {
     cubos.addComponent<Position>();
@@ -91,28 +93,39 @@ void cubos::engine::transformPlugin(Cubos& cubos)
             }
         });
 
-    cubos.tag("cubos.transform.missing").before("cubos.transform.update");
+    cubos.tag("cubos.transform.missing").before("cubos.transform.update.relative");
 
-    cubos.system("update LocalToWorld")
-        .tagged("cubos.transform.update")
-        .call([](Query<Entity, LocalToWorld&, Opt<const Position&>, Opt<const Rotation&>, Opt<const Scale&>> query) {
-            for (auto [entity, localToWorld, position, rotation, scale] : query)
+    cubos.system("update relative transform matrix")
+        .tagged("cubos.transform.update.relative")
+        .before("cubos.transform.update")
+        .call([](Query<LocalToWorld&, Opt<LocalToParent&>, const Position&, const Rotation&, const Scale&> query) {
+            for (auto [localToWorld, localToParent, position, rotation, scale] : query)
             {
-                localToWorld.mat = glm::mat4(1.0F);
-                if (position)
-                {
-                    localToWorld.mat = glm::translate(localToWorld.mat, position->vec);
-                }
+                auto mat = glm::scale(glm::translate(localToWorld.mat, position.vec) * glm::toMat4(rotation.quat),
+                                      glm::vec3(scale.factor));
 
-                if (rotation)
+                if (localToParent)
                 {
-                    localToWorld.mat *= glm::toMat4(rotation->quat);
+                    localToParent->mat = mat;
                 }
-
-                if (scale)
+                else
                 {
-                    localToWorld.mat = glm::scale(localToWorld.mat, glm::vec3(scale->factor));
+                    // No parent, so transform is relative to the world
+                    localToWorld.mat = mat;
                 }
             }
         });
+
+    cubos.system("update LocalToWorlds of children")
+        .tagged("cubos.transform.update")
+        .with<LocalToWorld>()
+        .with<LocalToParent>()
+        .related<ChildOf>(Traversal::Down)
+        .with<LocalToWorld>()
+        .call([](Query<LocalToWorld&, const LocalToParent&, const LocalToWorld&> query) {
+            for (auto [localToWorld, localToParent, parentLocalToWorld] : query)
+            {
+                localToWorld.mat = parentLocalToWorld.mat * localToParent.mat;
+            }
+        });
 }