The 68-year-old country singer is the godmother of Cyrus and previously appeared as a guest star in TV series 'Hannah Montana', reported BBC online.
"She's a great talent, Miley, who I've known ever since she was a tiny little baby. She's always been smart and quick and she is so gifted and I really, really hope she does great in this world of show business, and I believe she will," Parton said.
The '9 to 5' singer added, "I believe she's gonna make the right choices, she's had to go a little drastic now and then just to prove her point, but I've got a lot of faith in her and I'm hoping she does great 'cos she is gifted and special.
"You know her comedic timing is very good, so she's got all the goods - I'm just hoping she uses all of it well."