diff --git a/doc/source/whatsnew/v1.1.1.rst b/doc/source/whatsnew/v1.1.1.rst
index 7db609fba5d68..77ac362593e2a 100644
--- a/doc/source/whatsnew/v1.1.1.rst
+++ b/doc/source/whatsnew/v1.1.1.rst
@@ -17,6 +17,7 @@ Fixed regressions
 
 - Fixed regression where :func:`read_csv` would raise a ``ValueError`` when ``pandas.options.mode.use_inf_as_na`` was set to ``True`` (:issue:`35493`).
 - Fixed regression in :class:`pandas.core.groupby.RollingGroupby` where column selection was ignored (:issue:`35486`)
+- Fixed regression in :meth:`DataFrame.shift` with ``axis=1`` and heterogeneous dtypes (:issue:`35488`)
 
 .. ---------------------------------------------------------------------------
 
diff --git a/pandas/core/internals/managers.py b/pandas/core/internals/managers.py
index 0ce2408eb003e..4693cc193c27c 100644
--- a/pandas/core/internals/managers.py
+++ b/pandas/core/internals/managers.py
@@ -551,6 +551,24 @@ def interpolate(self, **kwargs) -> "BlockManager":
         return self.apply("interpolate", **kwargs)
 
     def shift(self, periods: int, axis: int, fill_value) -> "BlockManager":
+        if axis == 0 and self.ndim == 2 and self.nblocks > 1:
+            # GH#35488 we need to watch out for multi-block cases
+            ncols = self.shape[0]
+            if periods > 0:
+                indexer = [-1] * periods + list(range(ncols - periods))
+            else:
+                nper = abs(periods)
+                indexer = list(range(nper, ncols)) + [-1] * nper
+            result = self.reindex_indexer(
+                self.items,
+                indexer,
+                axis=0,
+                fill_value=fill_value,
+                allow_dups=True,
+                consolidate=False,
+            )
+            return result
+
         return self.apply("shift", periods=periods, axis=axis, fill_value=fill_value)
 
     def fillna(self, value, limit, inplace: bool, downcast) -> "BlockManager":
@@ -1213,6 +1231,7 @@ def reindex_indexer(
         fill_value=None,
         allow_dups: bool = False,
         copy: bool = True,
+        consolidate: bool = True,
     ) -> T:
         """
         Parameters
@@ -1223,7 +1242,8 @@ def reindex_indexer(
         fill_value : object, default None
         allow_dups : bool, default False
         copy : bool, default True
-
+        consolidate: bool, default True
+            Whether to consolidate inplace before reindexing.
 
         pandas-indexer with -1's only.
         """
@@ -1236,7 +1256,8 @@ def reindex_indexer(
             result.axes[axis] = new_axis
             return result
 
-        self._consolidate_inplace()
+        if consolidate:
+            self._consolidate_inplace()
 
         # some axes don't allow reindexing with dups
         if not allow_dups:
diff --git a/pandas/tests/frame/methods/test_shift.py b/pandas/tests/frame/methods/test_shift.py
index 9ec029a6c4304..8f6902eca816f 100644
--- a/pandas/tests/frame/methods/test_shift.py
+++ b/pandas/tests/frame/methods/test_shift.py
@@ -145,6 +145,33 @@ def test_shift_duplicate_columns(self):
         tm.assert_frame_equal(shifted[0], shifted[1])
         tm.assert_frame_equal(shifted[0], shifted[2])
 
+    def test_shift_axis1_multiple_blocks(self):
+        # GH#35488
+        df1 = pd.DataFrame(np.random.randint(1000, size=(5, 3)))
+        df2 = pd.DataFrame(np.random.randint(1000, size=(5, 2)))
+        df3 = pd.concat([df1, df2], axis=1)
+        assert len(df3._mgr.blocks) == 2
+
+        result = df3.shift(2, axis=1)
+
+        expected = df3.take([-1, -1, 0, 1, 2], axis=1)
+        expected.iloc[:, :2] = np.nan
+        expected.columns = df3.columns
+
+        tm.assert_frame_equal(result, expected)
+
+        # Case with periods < 0
+        # rebuild df3 because `take` call above consolidated
+        df3 = pd.concat([df1, df2], axis=1)
+        assert len(df3._mgr.blocks) == 2
+        result = df3.shift(-2, axis=1)
+
+        expected = df3.take([2, 3, 4, -1, -1], axis=1)
+        expected.iloc[:, -2:] = np.nan
+        expected.columns = df3.columns
+
+        tm.assert_frame_equal(result, expected)
+
     @pytest.mark.filterwarnings("ignore:tshift is deprecated:FutureWarning")
     def test_tshift(self, datetime_frame):
         # TODO: remove this test when tshift deprecation is enforced