Maternal uncle marrying the daughter of his sister’s son

It is not permissible for your maternal uncle to marry your
daughter, because a man’s maternal uncle is also the maternal uncle of his
sons and daughters. Allaah says (interpretation of the meaning): 

“Forbidden to you (for
marriage) are: your mothers, your daughters, your sisters, your father’s
sisters, your mother’s sisters, your brother’s daughters, your sister’s
daughters, your foster mothers who gave you suck, your foster milk suckling
sisters, your wives’ mothers, your stepdaughters under your guardianship,
born of your wives to whom you have gone in — but there is no sin on you if
you have not gone in them (to marry their daughters), — the wives of your
sons who (spring) from your own loins, and two sisters in wedlock at the
same time, except for what has already passed; verily, Allaah is
Oft‑Forgiving, Most Merciful”

[al-Nisa’ 4:23]

The words “your sister’s daughters” indicate that all
daughters of one’s sister are forbidden in marriage, no matter how far the
line of descent extends. This includes the daughter of the sister’s daughter
and the daughter of the sister’s son, no matter how far the line of descent
extends. Al-Qaasimi said: Also included with daughters are their children.

Tafseer al-Qaasimi,
5/86

And Allaah knows
best.