"Noah and Demi are friends and share a deep connection," a source tells ET. "They support each other emotionally and in terms of their careers."
The source adds that both artists are "deep and open and have a ton in common, including music, and the way they see the world."
"They are spending more and more time together and letting things flow naturally," the source adds, referring to the pair's frequent outings in recent weeks.
The two singers were photographed holding hands while they attended the Space Jam: A New Legacy party in the Park After Dark event at Six Flags Magic Mountain in Valencia, California, late last month.
The outing came two weeks after the musicians appeared together onstage during the YouTube Pride 2021 event, alongside the Trans Chorus of Los Angeles. Together, they performed their recent collaboration, "Easy," off Lovato's latest album, Dancing With the Devil... the Art of Starting Over.
For more on Lovato and Cyrus' friendship, see the video below.