diff --git a/CHANGELOG b/CHANGELOG
index 44d5938e..66d2f49b 100644
--- a/CHANGELOG
+++ b/CHANGELOG
@@ -1,7 +1,10 @@
 Development Version
 -------------------
 
-Nothing yet.
+* IMPORTANT: Dollar signs are now escaped in the `php` output format. PHP
+  interpolates `$var`, `${expr}` and `{$expr}` inside double-quoted strings,
+  so SQL text containing them could inject PHP code into the generated
+  snippet (CVE-2026-112307, pr930 by xiehuanyi).
 
 
 Release 0.6.0 (Aug 13, 2026)
diff --git a/sqlparse/filters/output.py b/sqlparse/filters/output.py
index d4e20f29..c9e846e1 100644
--- a/sqlparse/filters/output.py
+++ b/sqlparse/filters/output.py
@@ -115,9 +115,13 @@ def _process(self, stream, varname, has_nl):
 
             # Escape backslashes before quotes so a backslash preceding a
             # quote cannot break out of the generated string literal
-            # (GHSA-3496-9g83-7v6x).
+            # (GHSA-3496-9g83-7v6x). Dollar signs are escaped last because
+            # PHP interpolates $var, ${expr} and {$expr} inside double-quoted
+            # strings (CVE-2026-112307).
             else:
-                token.value = token.value.replace('\\', '\\\\').replace('"', '\\"')
+                token.value = (token.value.replace('\\', '\\\\')
+                               .replace('"', '\\"')
+                               .replace('$', '\\$'))
 
             # Put the token
             yield sql.Token(T.Text, token.value)
diff --git a/tests/test_format.py b/tests/test_format.py
index 93495067..06c93424 100644
--- a/tests/test_format.py
+++ b/tests/test_format.py
@@ -705,6 +705,45 @@ def test_php_escapes_backslashes(self):
         f = lambda sql: sqlparse.format(sql, output_format='php')
         assert f(sql) == '$sql = "select \'\\\\foo\\\\\'";'
 
+    @pytest.mark.parametrize('sql, expected', [
+        # plain variable interpolation
+        ("SELECT '$name'", r'''$sql = "SELECT '\$name'";'''),
+        # expression interpolation payloads (CVE-2026-112307)
+        ("SELECT '${expr}'", r'''$sql = "SELECT '\${expr}'";'''),
+        ("SELECT '{${expr}}'", r'''$sql = "SELECT '{\${expr}}'";'''),
+        ("SELECT '{$obj->prop}'", r'''$sql = "SELECT '{\$obj->prop}'";'''),
+        # PostgreSQL dollar-quoted strings
+        ('SELECT $body$text$body$',
+         r'''$sql = "SELECT \$body\$text\$body\$";'''),
+        # quoted identifiers and comments
+        ('SELECT "$table"', r'''$sql = "SELECT \"\$table\"";'''),
+        ('SELECT 1 /* $name */', r'''$sql = "SELECT 1 /* \$name */";'''),
+        # an existing backslash must not neutralize the dollar escape
+        ("SELECT '\\$name'", r'''$sql = "SELECT '\\\$name'";'''),
+    ])
+    def test_php_escapes_dollar_signs(self, sql, expected):
+        # CVE-2026-112307: "$" starts variable/expression interpolation in
+        # PHP double-quoted strings and must be escaped.
+        assert sqlparse.format(sql, output_format='php') == expected
+
+    def test_php_dollar_escape_multiline(self):
+        sql = 'select $a$x$a$\nfrom foo where b = \'$c\''
+        formatted = sqlparse.format(sql, output_format='php')
+        assert formatted == '\n'.join([
+            '$sql  = "select \\$a\\$x\\$a\\$ ";',
+            '$sql .= "from foo where b = \'\\$c\'";'])
+
+    def test_php_variable_name_keeps_dollar(self):
+        # only SQL content is escaped, not the generated assignment target
+        formatted = sqlparse.format('select 1; select 2', output_format='php')
+        assert formatted == '$sql = "select 1; ";\n$sql2 = "select 2";'
+
+    def test_python_dollar_signs_unchanged(self):
+        # "$" has no special meaning in single-quoted Python strings
+        sql = "select '$name' from $t$x$t$"
+        formatted = sqlparse.format(sql, output_format='python')
+        assert formatted == "sql = 'select \\'$name\\' from $t$x$t$'"
+
     def test_sql(self):
         # "sql" is an allowed option but has no effect
         sql = 'select * from foo;'