diff --git a/botorch/utils/datasets.py b/botorch/utils/datasets.py
index ef68274e58..c33a040d32 100644
--- a/botorch/utils/datasets.py
+++ b/botorch/utils/datasets.py
@@ -37,30 +37,27 @@ def __call__(cls, *args: Any, **kwargs: Any):
         r"""Converts Tensor-valued fields to DenseContainer under the assumption
         that said fields house collections of feature vectors."""
         hints = get_type_hints(cls)
-        f_iter = filter(
-            lambda f: f.init and issubclass(hints[f.name], BotorchContainer),
-            fields(cls),
-        )
+        f_iter = filter(lambda f: f.init, fields(cls))
         f_dict = {}
         for obj, f in chain(
             zip(args, f_iter), ((kwargs.pop(f.name, MISSING), f) for f in f_iter)
         ):
             if obj is MISSING:
                 if f.default is not MISSING:
-
                     obj = f.default
                 elif f.default_factory is not MISSING:
                     obj = f.default_factory()
                 else:
                     raise RuntimeError(f"Missing required field `{f.name}`.")
 
-            if isinstance(obj, Tensor):
-                obj = DenseContainer(obj, event_shape=obj.shape[-1:])
-            elif not isinstance(obj, BotorchContainer):
-                raise TypeError(
-                    f"Expected <BotorchContainer | Tensor> for field `{f.name}` "
-                    f"but was {type(obj)}."
-                )
+            if issubclass(hints[f.name], BotorchContainer):
+                if isinstance(obj, Tensor):
+                    obj = DenseContainer(obj, event_shape=obj.shape[-1:])
+                elif not isinstance(obj, BotorchContainer):
+                    raise TypeError(
+                        f"Expected <BotorchContainer | Tensor> for field `{f.name}` "
+                        f"but was {type(obj)}."
+                    )
             f_dict[f.name] = obj
 
         return super().__call__(**f_dict, **kwargs)
diff --git a/test/utils/test_datasets.py b/test/utils/test_datasets.py
index 0eb088047c..fd550a2846 100644
--- a/test/utils/test_datasets.py
+++ b/test/utils/test_datasets.py
@@ -15,7 +15,7 @@
     SupervisedDataset,
 )
 from botorch.utils.testing import BotorchTestCase
-from torch import rand, randperm, Size, stack, tensor
+from torch import rand, randperm, Size, stack, tensor, Tensor
 
 
 class TestDatasets(BotorchTestCase):
@@ -31,6 +31,7 @@ def test_supervised_meta(self):
         X = rand(3, 2)
         Y = rand(3, 1)
         A = DenseContainer(rand(3, 5), event_shape=Size([5]))
+        B = rand(2, 1)
 
         SupervisedDatasetWithDefaults = make_dataclass(
             cls_name="SupervisedDatasetWithDefaults",
@@ -38,6 +39,7 @@ def test_supervised_meta(self):
             fields=[
                 ("default", DenseContainer, field(default=A)),
                 ("factory", DenseContainer, field(default_factory=lambda: A)),
+                ("other", Tensor, field(default_factory=lambda: B)),
             ],
         )
 
@@ -55,13 +57,23 @@ def test_supervised_meta(self):
         dataset = SupervisedDatasetWithDefaults(X=X, Y=Y)
         self.assertEqual(dataset.default, A)
         self.assertEqual(dataset.factory, A)
+        self.assertTrue(dataset.other is B)
 
         # Check type coercion
-        dataset = SupervisedDatasetWithDefaults(X=X, Y=Y, default=X, factory=Y)
+        dataset = SupervisedDatasetWithDefaults(X=X, Y=Y, default=X, factory=Y, other=B)
         self.assertIsInstance(dataset.X, DenseContainer)
         self.assertIsInstance(dataset.Y, DenseContainer)
         self.assertEqual(dataset.default, dataset.X)
         self.assertEqual(dataset.factory, dataset.Y)
+        self.assertTrue(dataset.other is B)
+
+        # Check handling of positional arguments
+        dataset = SupervisedDatasetWithDefaults(X, Y, X, Y, X)
+        self.assertIsInstance(dataset.X, DenseContainer)
+        self.assertIsInstance(dataset.Y, DenseContainer)
+        self.assertEqual(dataset.default, dataset.X)
+        self.assertEqual(dataset.factory, dataset.Y)
+        self.assertTrue(dataset.other is X)
 
     def test_supervised(self):
         # Generate some data