diff --git a/chain/chain/src/flat_storage_resharder.rs b/chain/chain/src/flat_storage_resharder.rs
index 87d552ab0dd..03d05da4685 100644
--- a/chain/chain/src/flat_storage_resharder.rs
+++ b/chain/chain/src/flat_storage_resharder.rs
@@ -612,13 +612,24 @@ impl FlatStorageResharder {
         info!(target: "resharding", ?shard_uid, "flat storage shard catchup task started");
         let metrics = FlatStorageReshardingShardCatchUpMetrics::new(&shard_uid);
         // Apply deltas and then create the flat storage.
-        let apply_result = self.shard_catchup_apply_deltas(shard_uid, chain_store, &metrics);
-        let Ok(res) = apply_result else {
-            error!(target: "resharding", ?shard_uid, err = ?apply_result.unwrap_err(), "flat storage shard catchup delta application failed!");
-            return FlatStorageReshardingTaskResult::Failed;
-        };
-        let Some((num_batches_done, flat_head)) = res else {
-            return FlatStorageReshardingTaskResult::Postponed;
+        let (num_batches_done, flat_head) = match self.shard_catchup_apply_deltas(
+            shard_uid,
+            chain_store,
+            &metrics,
+        ) {
+            Ok(ShardCatchupApplyDeltasOutcome::Succeeded(num_batches_done, tip)) => {
+                (num_batches_done, tip)
+            }
+            Ok(ShardCatchupApplyDeltasOutcome::Cancelled) => {
+                return FlatStorageReshardingTaskResult::Cancelled;
+            }
+            Ok(ShardCatchupApplyDeltasOutcome::Postponed) => {
+                return FlatStorageReshardingTaskResult::Postponed;
+            }
+            Err(err) => {
+                error!(target: "resharding", ?shard_uid, ?err, "flat storage shard catchup delta application failed!");
+                return FlatStorageReshardingTaskResult::Failed;
+            }
         };
         match self.shard_catchup_finalize_storage(shard_uid, &flat_head, &metrics) {
             Ok(_) => {
@@ -648,13 +659,16 @@ impl FlatStorageResharder {
 
     /// Applies flat storage deltas in batches on a shard that is in catchup status.
     ///
-    /// Returns the number of delta batches applied and the final tip of the flat storage.
+    /// This function can either:
+    /// - Finish successfully, returning the number of delta batches applied and the final tip of the flat storage.
+    /// - Be cancelled
+    /// - Be postponed, to let other operations run on this intermediate state of flat storage (example state sync snapshot).
     fn shard_catchup_apply_deltas(
         &self,
         shard_uid: ShardUId,
         chain_store: &ChainStore,
         metrics: &FlatStorageReshardingShardCatchUpMetrics,
-    ) -> Result<Option<(usize, Tip)>, Error> {
+    ) -> Result<ShardCatchupApplyDeltasOutcome, Error> {
         // How many block heights of deltas are applied in a single commit.
         let catch_up_blocks = self.resharding_config.get().catch_up_blocks;
         // Delay between every batch.
@@ -680,7 +694,6 @@ impl FlatStorageResharder {
         };
 
         loop {
-            // TODO:(resharding): check self.controller.is_cancelled() here as well.
             let _span = tracing::debug_span!(
                 target: "resharding",
                 "shard_catchup_apply_deltas/batch",
@@ -692,10 +705,10 @@ impl FlatStorageResharder {
 
             // If we reached the desired new flat head, we can terminate the delta application step.
             if is_flat_head_on_par_with_chain(&flat_head.hash, &chain_final_head) {
-                return Ok(Some((
+                return Ok(ShardCatchupApplyDeltasOutcome::Succeeded(
                     num_batches_done,
                     Tip::from_header(&chain_store.get_block_header(&flat_head.hash)?),
-                )));
+                ));
             }
 
             let mut merged_changes = FlatStateChanges::default();
@@ -746,8 +759,12 @@ impl FlatStorageResharder {
             metrics.set_head_height(flat_head.height);
 
             if postpone {
-                return Ok(None);
+                return Ok(ShardCatchupApplyDeltasOutcome::Postponed);
+            }
+            if self.controller.is_cancelled() {
+                return Ok(ShardCatchupApplyDeltasOutcome::Cancelled);
             }
+
             // Sleep between batches in order to throttle resharding and leave some resource for the
             // regular node operation.
             std::thread::sleep(batch_delay);
@@ -1141,6 +1158,14 @@ enum FlatStorageReshardingTaskSchedulingStatus {
     Postponed,
 }
 
+/// Outcome of the task that applies deltas during shard catchup.
+enum ShardCatchupApplyDeltasOutcome {
+    /// Contains the number of delta batches applied and the final tip of the flat storage.
+    Succeeded(usize, Tip),
+    Cancelled,
+    Postponed,
+}
+
 /// Helps control the flat storage resharder background operations. This struct wraps
 /// [ReshardingHandle] and gives better meaning request to stop any processing when applied to flat
 /// storage. In flat storage resharding there's a slight difference between interrupt and cancel.
@@ -1719,6 +1744,47 @@ mod tests {
         }
     }
 
+    #[test]
+    fn cancel_shard_catchup() {
+        init_test_logger();
+        let (chain, resharder, sender) =
+            create_chain_resharder_sender::<DelayedSender>(simple_shard_layout());
+        let new_shard_layout = shard_layout_after_split();
+        let resharding_event_type = event_type_from_chain_and_layout(&chain, &new_shard_layout);
+
+        // Perform resharding.
+        assert!(resharder.start_resharding(resharding_event_type, &new_shard_layout).is_ok());
+        let (_, split_params) = resharder.get_parent_shard_and_split_params().unwrap();
+        let ParentSplitParameters { left_child_shard, right_child_shard, .. } = split_params;
+
+        // Run the split task.
+        assert_matches!(
+            sender.call_split_shard_task(),
+            FlatStorageReshardingTaskResult::Successful { num_batches_done: _ }
+        );
+
+        // Cancel resharding.
+        resharder.controller.handle.stop();
+
+        // Run the catchup tasks.
+        assert_eq!(
+            sender.call_shard_catchup_tasks(),
+            vec![
+                FlatStorageReshardingTaskResult::Cancelled,
+                FlatStorageReshardingTaskResult::Cancelled
+            ]
+        );
+
+        // Check that resharding was effectively cancelled.
+        let flat_store = resharder.runtime.store().flat_store();
+        for child_shard in [left_child_shard, right_child_shard] {
+            assert_matches!(
+                flat_store.get_flat_storage_status(child_shard),
+                Ok(FlatStorageStatus::Resharding(FlatStorageReshardingStatus::CatchingUp(_)))
+            );
+        }
+    }
+
     /// A shard can't be split if it isn't in ready state.
     #[test]
     fn reject_split_shard_if_parent_is_not_ready() {