diff --git a/python/sglang/srt/distributed/bootstrap.py b/python/sglang/srt/distributed/bootstrap.py
index ab7be1f9e..e0c37793d 100644
--- a/python/sglang/srt/distributed/bootstrap.py
+++ b/python/sglang/srt/distributed/bootstrap.py
@@ -61,15 +61,7 @@ def init_torch_distributed(
     tic = time.perf_counter()
     logger.info("Init torch distributed begin.")
 
-    try:
-        torch.get_device_module(device).set_device(ps.gpu_id)
-    except Exception:
-        logger.warning(
-            f"Context: {device=} {ps.gpu_id=} {os.environ.get('CUDA_VISIBLE_DEVICES')=} {ps.tp_rank=} {ps.tp_size=}"
-        )
-        raise
-
-    backend = _resolve_backend(device=device, server_args=server_args, gpu_id=ps.gpu_id)
+    backend = _resolve_backend(device=device, server_args=server_args)
 
     before_avail_memory = get_available_gpu_memory(device, ps.gpu_id)
     if not server_args.enable_p2p_check:
@@ -143,27 +135,10 @@ def init_torch_distributed(
     )
 
 
-def _resolve_backend(*, device: str, server_args: ServerArgs, gpu_id: int) -> str:
+def _resolve_backend(*, device: str, server_args: ServerArgs) -> str:
     backend = get_default_distributed_backend(device)
     if device == "cuda" and server_args.elastic_ep_backend == "mooncake":
         backend = "mooncake"
-        if server_args.mooncake_ib_device:
-            from sglang.srt.distributed.device_communicators.mooncake_transfer_engine import (
-                get_ib_devices_for_gpu,
-            )
-
-            ib_device_for_gpu = get_ib_devices_for_gpu(
-                server_args.mooncake_ib_device, gpu_id
-            )
-            mooncake_ib_device = (
-                ib_device_for_gpu.split(",") if ib_device_for_gpu else []
-            )
-            try:
-                from mooncake import ep as mooncake_ep
-
-                mooncake_ep.set_device_filter(mooncake_ib_device)
-            except:
-                pass  # A warning will be raised in `init_distributed_environment`
     return backend
 
 
diff --git a/python/sglang/srt/distributed/device_communicators/mooncake_transfer_engine.py b/python/sglang/srt/distributed/device_communicators/mooncake_transfer_engine.py
index ce08c6fbc..de7c011ec 100644
--- a/python/sglang/srt/distributed/device_communicators/mooncake_transfer_engine.py
+++ b/python/sglang/srt/distributed/device_communicators/mooncake_transfer_engine.py
@@ -333,6 +333,7 @@ def maybe_init_shared_mooncake_transfer_engine(
             server_args.enable_elastic_expert_backup
             and server_args.elastic_ep_backend is not None
         )
+        or server_args.elastic_ep_backend == "mooncake"
     )
 
     if use_mooncake_te:
@@ -343,3 +344,14 @@ def maybe_init_shared_mooncake_transfer_engine(
                 server_args.disaggregation_ib_device or server_args.mooncake_ib_device
             ),
         )
+
+        if server_args.elastic_ep_backend == "mooncake":
+            try:
+                from mooncake.pg import set_transfer_engine
+            except ImportError as e:
+                raise ImportError(
+                    "Failed to import 'set_transfer_engine' from 'mooncake.pg'. "
+                    "Please upgrade your 'mooncake-transfer-engine' "
+                    "installation to 0.3.11 or above."
+                ) from e
+            set_transfer_engine(_mooncake_transfer_engine.engine)
diff --git a/python/sglang/srt/distributed/parallel_state.py b/python/sglang/srt/distributed/parallel_state.py
index df1e90b93..241be9026 100644
--- a/python/sglang/srt/distributed/parallel_state.py
+++ b/python/sglang/srt/distributed/parallel_state.py
@@ -1960,17 +1960,6 @@ def init_distributed_environment(
         distributed_init_method,
         backend,
     )
-    if "mooncake" in backend:
-        try:
-            from mooncake import ep as mooncake_ep
-        except ImportError as e:
-            raise ImportError(
-                "Please install mooncake by following the instructions at "
-                "https://github.com/kvcache-ai/Mooncake/blob/main/doc/en/build.md "  # noqa: E501
-                "to run SGLang with Mooncake Backend."
-            ) from e
-        mooncake_ep.set_host_ip(get_local_ip_auto())
-
     if not torch.distributed.is_initialized():
         global _MODEL_PARALLEL_GROUP_TIMEOUT
         assert distributed_init_method is not None, (
diff --git a/python/sglang/srt/model_executor/model_runner.py b/python/sglang/srt/model_executor/model_runner.py
index 67a65b473..232919230 100644
--- a/python/sglang/srt/model_executor/model_runner.py
+++ b/python/sglang/srt/model_executor/model_runner.py
@@ -322,13 +322,27 @@ class ModelRunner:
         if get_server_args().enable_tf32_matmul:
             torch.set_float32_matmul_precision("high")
 
+        # Set device early so that TransferEngine init (e.g. Ascend NPU)
+        # can access the device context.
+        try:
+            torch.get_device_module(self.device).set_device(ps.gpu_id)
+        except Exception:
+            import os
+
+            logger.warning(
+                f"Context: {self.device=} {ps.gpu_id=} {os.environ.get('CUDA_VISIBLE_DEVICES')=} {ps.tp_rank=} {ps.tp_size=}"
+            )
+            raise
+
+        # Initialize MooncakeTransferEngine BEFORE init_torch_distributed so
+        # that the shared TE can be passed to the Mooncake PG backend (avoids
+        # creating duplicate TransferEngines).
+        self.init_shared_mooncake_transfer_engine()
+
         # Get available memory before model loading.
         # Stored for later use by alloc_memory_pool().
         self.init_torch_distributed()
 
-        # Initialize MooncakeTransferEngine
-        self.init_shared_mooncake_transfer_engine()
-
         # Init forward stream for overlap schedule
         self.forward_stream = torch.get_device_module(self.device).Stream()