diff --git a/src/Orleans.Transactions/State/ReaderWriterLock.cs b/src/Orleans.Transactions/State/ReaderWriterLock.cs
index 37efb8f6ccd..1ef30aede09 100644
--- a/src/Orleans.Transactions/State/ReaderWriterLock.cs
+++ b/src/Orleans.Transactions/State/ReaderWriterLock.cs
@@ -192,7 +192,7 @@ void completion()
         {
             if (currentGroup == null || !currentGroup.TryGetValue(transactionId, out TransactionRecord<TState>? record))
             {
-                return (TransactionalStatus.BrokenLock, new TransactionRecord<TState>());
+                return (TransactionalStatus.BrokenLock, new TransactionRecord<TState> { TransactionId = transactionId });
             }
             else if (record.NumberReads != accessCount.Reads
                    || record.NumberWrites != accessCount.Writes)
diff --git a/src/Orleans.Transactions/State/TransactionQueue.cs b/src/Orleans.Transactions/State/TransactionQueue.cs
index ce0107c8639..b5a47c63551 100644
--- a/src/Orleans.Transactions/State/TransactionQueue.cs
+++ b/src/Orleans.Transactions/State/TransactionQueue.cs
@@ -588,6 +588,10 @@ public async Task NotifyOfCancel(Guid transactionId, DateTime timeStamp, Transac
 
             if (pos == -1)
             {
+                // Cancel can overtake the one-way prepare message. Release the pre-prepare lock so a
+                // late prepare observes a broken lock and completes without persisting a remote commit.
+                this.RWLock.Rollback(transactionId);
+                this.RWLock.Notify();
                 TransactionDiagnosticEvents.EmitTransactionCancelCompleted(
                     resource,
                     transactionId,
diff --git a/test/Transactions/Orleans.Transactions.Tests/TransactionRecoveryLatencyTests.cs b/test/Transactions/Orleans.Transactions.Tests/TransactionRecoveryLatencyTests.cs
index f5a621b2abb..01a84bd0e3e 100644
--- a/test/Transactions/Orleans.Transactions.Tests/TransactionRecoveryLatencyTests.cs
+++ b/test/Transactions/Orleans.Transactions.Tests/TransactionRecoveryLatencyTests.cs
@@ -62,6 +62,30 @@ public void FreshRemoteCommitRetainsFirstPingGraceThenUsesBoundedExponentialRetr
         }
     }
 
+    [Fact]
+    public async Task CancelBeforePrepareBreaksPrePrepareLockAndRetainsTransactionId()
+    {
+        var resource = CreateParticipant("resource", ParticipantId.Role.Resource);
+        var queue = new GatedCancelTransactionQueue(resource, new TestActivationLifetime());
+        var transactionId = Guid.NewGuid();
+        var timeStamp = new DateTime(2026, 8, 8, 12, 0, 0, DateTimeKind.Utc);
+        var accessCount = new AccessCounter { Writes = 1 };
+
+        await queue.RWLock.EnterLock(
+            transactionId,
+            timeStamp,
+            default,
+            isRead: false,
+            exclusiveLock: false,
+            static () => 0);
+
+        await queue.NotifyOfCancel(transactionId, timeStamp, TransactionalStatus.CascadingAbort);
+
+        var (status, record) = await queue.RWLock.ValidateLock(transactionId, accessCount);
+        Assert.Equal(TransactionalStatus.BrokenLock, status);
+        Assert.Equal(transactionId, record.TransactionId);
+    }
+
     [Fact]
     public void StorageBatchTracksCommittedTransactionIds()
     {