diff --git a/src/Dapr.Workflow/Worker/Internal/WorkflowOrchestrationContext.cs b/src/Dapr.Workflow/Worker/Internal/WorkflowOrchestrationContext.cs
index 70ad0fff4..60614fe2a 100644
--- a/src/Dapr.Workflow/Worker/Internal/WorkflowOrchestrationContext.cs
+++ b/src/Dapr.Workflow/Worker/Internal/WorkflowOrchestrationContext.cs
@@ -537,22 +537,28 @@ private void HandleEventRaisedEvent(HistoryEvent historyEvent, string eventName)
     {
         if (_externalEventSources.TryGetValue(eventName, out Queue<TaskCompletionSource<HistoryEvent>>? waiters))
         {
-            var tcs = waiters.Dequeue();
-
-            // Events are completed in FIFO order. Remove the key if the last event was delivered.
-            if (waiters.Count is 0)
+            while (waiters.Count > 0)
             {
-                _externalEventSources.Remove(eventName);
+                var tcs = waiters.Dequeue();
+                if (tcs.TrySetResult(historyEvent))
+                {
+                    // Events are completed in FIFO order. Remove the key if the last event was delivered.
+                    if (waiters.Count is 0)
+                    {
+                        _externalEventSources.Remove(eventName);
+                    }
+
+                    return;
+                }
             }
 
-            tcs.TrySetResult(historyEvent);
-        }
-        else
-        {
-            // The orchestrator isn't waiting for this event (yet?). Save it in case
-            // the orchestrator wants it later.
-            _externalEventBuffer.Add(historyEvent);
+            // All waiters were already completed/canceled. Remove and treat as unhandled.
+            _externalEventSources.Remove(eventName);
         }
+
+        // The orchestrator isn't waiting for this event (yet?) or all waiters were canceled.
+        // Save it in case the orchestrator wants it later.
+        _externalEventBuffer.Add(historyEvent);
     }
 
     /// <summary>
diff --git a/test/Dapr.IntegrationTest.Workflow/ExternalEventCancellationTests.cs b/test/Dapr.IntegrationTest.Workflow/ExternalEventCancellationTests.cs
new file mode 100644
index 000000000..8d3672de2
--- /dev/null
+++ b/test/Dapr.IntegrationTest.Workflow/ExternalEventCancellationTests.cs
@@ -0,0 +1,164 @@
+// ------------------------------------------------------------------------
+// Copyright 2025 The Dapr Authors
+// Licensed under the Apache License, Version 2.0 (the "License");
+// you may not use this file except in compliance with the License.
+// You may obtain a copy of the License at
+//     http://www.apache.org/licenses/LICENSE-2.0
+// Unless required by applicable law or agreed to in writing, software
+// distributed under the License is distributed on an "AS IS" BASIS,
+// WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+// See the License for the specific language governing permissions and
+// limitations under the License.
+//  ------------------------------------------------------------------------
+
+using Dapr.Testcontainers.Common;
+using Dapr.Testcontainers.Harnesses;
+using Dapr.Workflow;
+using Microsoft.Extensions.Configuration;
+using Microsoft.Extensions.DependencyInjection;
+
+namespace Dapr.IntegrationTest.Workflow;
+
+public sealed class ExternalEventCancellationSequentialTests
+{
+    [Fact]
+    public async Task ExternalEvents_ShouldComplete_WhenRaisedSequentially_WithDelay()
+    {
+        await ExternalEventCancellationTestHarness.RunAsync(
+            workflowCount: 1000,
+            raiseEventsInParallel: false,
+            perEventDelay: TimeSpan.FromMilliseconds(75),
+            initialWaitTimeout: TimeSpan.FromMilliseconds(200));
+    }
+}
+
+public sealed class ExternalEventCancellationParallelTests
+{
+    [Fact]
+    public async Task ExternalEvents_ShouldComplete_WhenRaisedInParallel_MinimalDelay()
+    {
+        await ExternalEventCancellationTestHarness.RunAsync(
+            workflowCount: 1000,
+            raiseEventsInParallel: true,
+            perEventDelay: TimeSpan.Zero,
+            initialWaitTimeout: TimeSpan.FromMilliseconds(200));
+    }
+}
+
+internal static class ExternalEventCancellationTestHarness
+{
+    private const string EventName = "SemaphoreSignal";
+    private const string WaitingAfterTimeoutStatus = "WaitingAfterTimeout";
+
+    public static async Task RunAsync(
+        int workflowCount,
+        bool raiseEventsInParallel,
+        TimeSpan perEventDelay,
+        TimeSpan initialWaitTimeout)
+    {
+        var componentsDir = TestDirectoryManager.CreateTestDirectory("workflow-components");
+        var workflowIds = Enumerable.Range(0, workflowCount)
+            .Select(_ => Guid.NewGuid().ToString())
+            .ToArray();
+
+        await using var environment = await DaprTestEnvironment.CreateWithPooledNetworkAsync(needsActorState: true);
+        await environment.StartAsync();
+
+        var harness = new DaprHarnessBuilder(componentsDir)
+            .WithEnvironment(environment)
+            .BuildWorkflow();
+        await using var testApp = await DaprHarnessBuilder.ForHarness(harness)
+            .ConfigureServices(builder =>
+            {
+                builder.Services.AddDaprWorkflowBuilder(
+                    configureRuntime: opt =>
+                    {
+                        opt.RegisterWorkflow<CanceledWaitWorkflow>();
+                    },
+                    configureClient: (sp, clientBuilder) =>
+                    {
+                        var config = sp.GetRequiredService<IConfiguration>();
+                        var grpcEndpoint = config["DAPR_GRPC_ENDPOINT"];
+                        if (!string.IsNullOrEmpty(grpcEndpoint))
+                            clientBuilder.UseGrpcEndpoint(grpcEndpoint);
+                    });
+            })
+            .BuildAndStartAsync();
+
+        using var scope = testApp.CreateScope();
+        var daprWorkflowClient = scope.ServiceProvider.GetRequiredService<DaprWorkflowClient>();
+
+        foreach (var workflowId in workflowIds)
+        {
+            await daprWorkflowClient.ScheduleNewWorkflowAsync(nameof(CanceledWaitWorkflow), workflowId, initialWaitTimeout);
+        }
+
+        using var waitCts = new CancellationTokenSource(TimeSpan.FromMinutes(3));
+        await Task.WhenAll(workflowIds.Select(id =>
+            WaitForCustomStatusAsync(daprWorkflowClient, id, WaitingAfterTimeoutStatus, waitCts.Token)));
+
+        if (raiseEventsInParallel)
+        {
+            var raiseTasks = workflowIds.Select(id =>
+                daprWorkflowClient.RaiseEventAsync(id, EventName, "released"));
+            await Task.WhenAll(raiseTasks);
+        }
+        else
+        {
+            foreach (var workflowId in workflowIds)
+            {
+                await daprWorkflowClient.RaiseEventAsync(workflowId, EventName, "released");
+                if (perEventDelay > TimeSpan.Zero)
+                    await Task.Delay(perEventDelay);
+            }
+        }
+
+        using var completionCts = new CancellationTokenSource(TimeSpan.FromMinutes(3));
+        var results = await Task.WhenAll(workflowIds.Select(id =>
+            daprWorkflowClient.WaitForWorkflowCompletionAsync(id, cancellation: completionCts.Token)));
+
+        foreach (var result in results)
+        {
+            Assert.Equal(WorkflowRuntimeStatus.Completed, result.RuntimeStatus);
+            var payload = result.ReadOutputAs<string>();
+            Assert.Equal("released", payload);
+        }
+    }
+
+    private static async Task WaitForCustomStatusAsync(
+        DaprWorkflowClient client,
+        string instanceId,
+        string expectedStatus,
+        CancellationToken cancellationToken)
+    {
+        while (true)
+        {
+            cancellationToken.ThrowIfCancellationRequested();
+            var state = await client.GetWorkflowStateAsync(instanceId, getInputsAndOutputs: true, cancellation: cancellationToken);
+            if (state is not null && string.Equals(state.ReadCustomStatusAs<string>(), expectedStatus, StringComparison.Ordinal))
+                return;
+
+            await Task.Delay(TimeSpan.FromMilliseconds(200), cancellationToken);
+        }
+    }
+
+    private sealed class CanceledWaitWorkflow : Workflow<TimeSpan, string>
+    {
+        public override async Task<string> RunAsync(WorkflowContext context, TimeSpan initialWaitTimeout)
+        {
+            try
+            {
+                context.SetCustomStatus("WaitingWithTimeout");
+                await context.WaitForExternalEventAsync<string>(EventName, initialWaitTimeout);
+                return "unexpected";
+            }
+            catch (TaskCanceledException)
+            {
+                context.SetCustomStatus(WaitingAfterTimeoutStatus);
+            }
+
+            var result = await context.WaitForExternalEventAsync<string>(EventName);
+            return result;
+        }
+    }
+}