diff --git a/doc/source/whatsnew/v1.2.0.rst b/doc/source/whatsnew/v1.2.0.rst
index 6f046d3a9379d..6ab9f9a58cb0c 100644
--- a/doc/source/whatsnew/v1.2.0.rst
+++ b/doc/source/whatsnew/v1.2.0.rst
@@ -737,6 +737,7 @@ Reshaping
 - Bug in :meth:`DataFrame.apply` not setting index of return value when ``func`` return type is ``dict`` (:issue:`37544`)
 - Bug in :func:`concat` resulting in a ``ValueError`` when at least one of both inputs had a non-unique index (:issue:`36263`)
 - Bug in :meth:`DataFrame.merge` and :meth:`pandas.merge` returning inconsistent ordering in result for ``how=right`` and ``how=left`` (:issue:`35382`)
+- Bug in :func:`merge_ordered` couldn't handle list-like ``left_by`` or ``right_by`` (:issue:`35269`)
 
 Sparse
 ^^^^^^
diff --git a/pandas/core/reshape/merge.py b/pandas/core/reshape/merge.py
index 3b755c40721fb..7b3d68500dd98 100644
--- a/pandas/core/reshape/merge.py
+++ b/pandas/core/reshape/merge.py
@@ -140,9 +140,7 @@ def _groupby_and_merge(by, on, left: "DataFrame", right: "DataFrame", merge_piec
 
         # make sure join keys are in the merged
         # TODO, should merge_pieces do this?
-        for k in by:
-            if k in merged:
-                merged[k] = key
+        merged[by] = key
 
         pieces.append(merged)
 
diff --git a/pandas/tests/reshape/merge/test_merge_ordered.py b/pandas/tests/reshape/merge/test_merge_ordered.py
index 17f2f44f45fce..8389a6bb9be10 100644
--- a/pandas/tests/reshape/merge/test_merge_ordered.py
+++ b/pandas/tests/reshape/merge/test_merge_ordered.py
@@ -115,3 +115,65 @@ def test_doc_example(self):
         )
 
         tm.assert_frame_equal(result, expected)
+
+    @pytest.mark.parametrize(
+        "left, right, on, left_by, right_by, expected",
+        [
+            (
+                DataFrame({"G": ["g", "g"], "H": ["h", "h"], "T": [1, 3]}),
+                DataFrame({"T": [2], "E": [1]}),
+                ["T"],
+                ["G", "H"],
+                None,
+                DataFrame(
+                    {
+                        "G": ["g"] * 3,
+                        "H": ["h"] * 3,
+                        "T": [1, 2, 3],
+                        "E": [np.nan, 1.0, np.nan],
+                    }
+                ),
+            ),
+            (
+                DataFrame({"G": ["g", "g"], "H": ["h", "h"], "T": [1, 3]}),
+                DataFrame({"T": [2], "E": [1]}),
+                "T",
+                ["G", "H"],
+                None,
+                DataFrame(
+                    {
+                        "G": ["g"] * 3,
+                        "H": ["h"] * 3,
+                        "T": [1, 2, 3],
+                        "E": [np.nan, 1.0, np.nan],
+                    }
+                ),
+            ),
+            (
+                DataFrame({"T": [2], "E": [1]}),
+                DataFrame({"G": ["g", "g"], "H": ["h", "h"], "T": [1, 3]}),
+                ["T"],
+                None,
+                ["G", "H"],
+                DataFrame(
+                    {
+                        "T": [1, 2, 3],
+                        "E": [np.nan, 1.0, np.nan],
+                        "G": ["g"] * 3,
+                        "H": ["h"] * 3,
+                    }
+                ),
+            ),
+        ],
+    )
+    def test_list_type_by(self, left, right, on, left_by, right_by, expected):
+        # GH 35269
+        result = merge_ordered(
+            left=left,
+            right=right,
+            on=on,
+            left_by=left_by,
+            right_by=right_by,
+        )
+
+        tm.assert_frame_equal(result, expected)