diff --git a/.changeset/msgraph-incremental-initial.md b/.changeset/msgraph-incremental-initial.md
index 2a16af91a8..3137c2b57f 100644
--- a/.changeset/msgraph-incremental-initial.md
+++ b/.changeset/msgraph-incremental-initial.md
@@ -4,4 +4,4 @@
 
 New package: `@backstage/plugin-catalog-backend-module-msgraph-incremental`
 
-Introduces a cursor-based incremental ingestion provider for Microsoft Graph that processes users and groups one page at a time. Unlike `MicrosoftGraphOrgEntityProvider`, this module never holds the full dataset in memory — each burst processes a single page of up to 999 items. The `@odata.nextLink` cursor is persisted so a pod restart resumes from the last completed page rather than starting over.
+Introduces a cursor-based incremental ingestion provider for Microsoft Graph that processes users and groups one page at a time. Unlike `MicrosoftGraphOrgEntityProvider`, this module never holds the full dataset in memory — each burst processes a single page (up to 999 users or 100 groups). The `@odata.nextLink` cursor is persisted so a pod restart resumes from the last completed page rather than starting over.
diff --git a/plugins/catalog-backend-module-msgraph-incremental/README.md b/plugins/catalog-backend-module-msgraph-incremental/README.md
index 60c971e87f..342148f049 100644
--- a/plugins/catalog-backend-module-msgraph-incremental/README.md
+++ b/plugins/catalog-backend-module-msgraph-incremental/README.md
@@ -9,8 +9,8 @@ AD tenants where holding the full dataset in memory at once is not practical.
 - **Cursor-based resumption** — the `@odata.nextLink` URL is persisted as the
   cursor, so a pod restart during ingestion resumes from the last completed page
   rather than starting over.
-- **Memory-efficient** — each burst processes a single page (up to 999 items),
-  keeping memory usage flat regardless of tenant size.
+- **Memory-efficient** — each burst processes a single page (up to 999 users
+  or 100 groups), keeping memory usage flat regardless of tenant size.
 - **Photo support** — user profile photos are fetched with a gated pre-check to
   avoid unnecessary API calls for users without photos.
 - **Transformer extension point** — user, group, organization, and provider
@@ -70,4 +70,5 @@ catalog:
 | Memory usage               | Full dataset in RAM               | One page at a time  |
 | Resume on restart          | Starts from scratch               | Resumes from cursor |
 | `userGroupMember*` options | Supported                         | Not supported       |
+| `groupIncludeSubGroups`    | Supported                         | Not supported       |
 | Suitable for large tenants | No                                | Yes                 |
diff --git a/plugins/catalog-backend-module-msgraph-incremental/src/MicrosoftGraphIncrementalEntityProvider.ts b/plugins/catalog-backend-module-msgraph-incremental/src/MicrosoftGraphIncrementalEntityProvider.ts
index 6c290f17ea..642cf88f44 100644
--- a/plugins/catalog-backend-module-msgraph-incremental/src/MicrosoftGraphIncrementalEntityProvider.ts
+++ b/plugins/catalog-backend-module-msgraph-incremental/src/MicrosoftGraphIncrementalEntityProvider.ts
@@ -153,8 +153,8 @@ export interface MicrosoftGraphIncrementalEntityProviderOptions {
  * at a time, and provides them as User and Group entities for the catalog.
  *
  * Unlike `MicrosoftGraphOrgEntityProvider`, this provider never holds the full
- * dataset in memory at once. Each burst processes a single page of users or
- * groups (up to 999 items). This makes it suitable for very large tenants and
+ * dataset in memory at once. Each burst processes a single page (up to 999
+ * users or 100 groups). This makes it suitable for very large tenants and
  * avoids the memory pressure and long-running task issues of the full-scan
  * provider.
  *
@@ -166,9 +166,11 @@ export interface MicrosoftGraphIncrementalEntityProviderOptions {
  * stitching derives `spec.memberOf` on users from these group membership lists.
  *
  * @remarks
- * `userGroupMemberFilter`, `userGroupMemberSearch`, and `userGroupMemberPath`
- * are not supported. Use `userFilter` / `userPath` to restrict which users are
- * ingested, and `groupFilter` / `groupSearch` to restrict which groups.
+ * `userGroupMemberFilter`, `userGroupMemberSearch`, `userGroupMemberPath`, and
+ * `groupIncludeSubGroups` are not supported. Use `userFilter` / `userPath` to
+ * restrict which users are ingested, and `groupFilter` / `groupSearch` to
+ * restrict which groups. Switch to `MicrosoftGraphOrgEntityProvider` if you
+ * require any of these options.
  *
  * @public
  */