diff --git a/xla/hlo/experimental/auto_sharding/BUILD b/xla/hlo/experimental/auto_sharding/BUILD
index ee63f4e96cc4f7..6a437e18a0353b 100644
--- a/xla/hlo/experimental/auto_sharding/BUILD
+++ b/xla/hlo/experimental/auto_sharding/BUILD
@@ -265,6 +265,7 @@ cc_library(
         "//xla/hlo/ir:hlo",
         "//xla/service/spmd:spmd_partitioner",
         "@com_google_absl//absl/container:btree",
+        "@com_google_absl//absl/container:btree_set",
         "@com_google_absl//absl/container:flat_hash_map",
         "@com_google_absl//absl/log:check",
         "@com_google_absl//absl/strings",
diff --git a/xla/hlo/experimental/auto_sharding/cluster_environment.cc b/xla/hlo/experimental/auto_sharding/cluster_environment.cc
index b5ad371562e0c8..9a68b636b79fa5 100644
--- a/xla/hlo/experimental/auto_sharding/cluster_environment.cc
+++ b/xla/hlo/experimental/auto_sharding/cluster_environment.cc
@@ -28,6 +28,7 @@ limitations under the License.
 #include "absl/container/flat_hash_map.h"
 #include "absl/log/check.h"
 #include "absl/types/span.h"
+#include "xla/hlo/experimental/auto_sharding/auto_sharding_device_mesh.h"
 #include "xla/hlo/experimental/auto_sharding/auto_sharding_strategy.h"
 #include "xla/hlo/experimental/auto_sharding/auto_sharding_util.h"
 #include "xla/hlo/ir/hlo_sharding.h"
@@ -162,7 +163,7 @@ double ClusterEnvironment::ReshardingCostMixedMeshShape(
     }
     if (IsSubset((*dst_tensor_dim_to_mesh_axis)[i],
                  (*src_tensor_dim_to_mesh_axis)[i])) {
-      // do nothing; the src is sharded more than the dest
+      // do nothing; the dst is sharded more than the src
       continue;
     }
     if (!IsSubset((*src_tensor_dim_to_mesh_axis)[i],
@@ -231,17 +232,16 @@ double ClusterEnvironment::CollectivePermuteCost(
 // Overestimate the cost of replicating a tensor by decomposing the resharding
 // operation as an all-gather on all mesh dimensions.
 double ClusterEnvironment::OverestimateReplicationCost(
-    const Shape& shape, const HloSharding& src_spec,
+    const Shape& shape, const HloSharding& src_sharding,
     const DeviceMesh& device_mesh) const {
-  if (src_spec.IsTileMaximal() || src_spec.IsManual()) {
-    // TODO(b/238210866) Do not use kInfinityCost.
-    return kInfinityCost;
+  if (src_sharding.IsReplicated()) {
+    return 0;
   }
-  int64_t bytes_moved = ByteSizeOfShapeWithSharding(shape, src_spec);
+  int64_t bytes_moved = ByteSizeOfShapeWithSharding(shape, src_sharding);
   double cost = 0.0;
   for (size_t i = 0; i < device_mesh.num_dimensions(); ++i) {
-    auto this_cost = this->AllGatherCost(bytes_moved, i);
-    cost += this_cost;
+    cost += src_sharding.IsTileMaximal() ? this->AllReduceCost(bytes_moved, i)
+                                         : this->AllGatherCost(bytes_moved, i);
     bytes_moved *= device_mesh.dimensions()[i];
   }
   return cost;