diff --git a/pkg/registry/apis/provisioning/controller/finalizers.go b/pkg/registry/apis/provisioning/controller/finalizers.go
index 487e6d4d062..a3eb35376fb 100644
--- a/pkg/registry/apis/provisioning/controller/finalizers.go
+++ b/pkg/registry/apis/provisioning/controller/finalizers.go
@@ -2,6 +2,7 @@ package controller
 
 import (
 	"context"
+	"encoding/json"
 	"sort"
 	"strings"
 
@@ -52,12 +53,14 @@ func (f *finalizer) process(ctx context.Context,
 		case ReleaseOrphanResourcesFinalizer:
 			err := f.processExistingItems(ctx, repo.Config(),
 				func(client dynamic.ResourceInterface, item *provisioning.ResourceListItem) error {
-					_, err := client.Patch(ctx, item.Name, types.JSONPatchType, []byte(`[
-						{"op": "remove", "path": "/metadata/annotations/`+utils.AnnoKeyManagerKind+`" },
-						{"op": "remove", "path": "/metadata/annotations/`+utils.AnnoKeyManagerIdentity+`" },
-						{"op": "remove", "path": "/metadata/annotations/`+utils.AnnoKeySourcePath+`" },
-						{"op": "remove", "path": "/metadata/annotations/`+utils.AnnoKeySourceChecksum+`" }
-					]`), v1.PatchOptions{})
+					patchAnnotations, err := getPatchedAnnotations(item)
+					if err != nil {
+						return err
+					}
+
+					_, err = client.Patch(
+						ctx, item.Name, types.JSONPatchType, patchAnnotations, v1.PatchOptions{},
+					)
 					return err
 				})
 			if err != nil {
@@ -124,6 +127,43 @@ func (f *finalizer) processExistingItems(
 	return nil
 }
 
+type jsonPatchOperation struct {
+	Op   string `json:"op"`
+	Path string `json:"path"`
+}
+
+func getPatchedAnnotations(item *provisioning.ResourceListItem) ([]byte, error) {
+	annotations := []jsonPatchOperation{
+		{Op: "remove", Path: "/metadata/annotations/" + escapePatchString(utils.AnnoKeyManagerKind)},
+		{Op: "remove", Path: "/metadata/annotations/" + escapePatchString(utils.AnnoKeyManagerIdentity)},
+	}
+
+	if item.Path != "" {
+		annotations = append(
+			annotations,
+			jsonPatchOperation{
+				Op: "remove", Path: "/metadata/annotations/" + escapePatchString(utils.AnnoKeySourcePath),
+			},
+		)
+	}
+	if item.Hash != "" {
+		annotations = append(
+			annotations,
+			jsonPatchOperation{
+				Op: "remove", Path: "/metadata/annotations/" + escapePatchString(utils.AnnoKeySourceChecksum),
+			},
+		)
+	}
+
+	return json.Marshal(annotations)
+}
+
+func escapePatchString(s string) string {
+	s = strings.ReplaceAll(s, "~", "~0")
+	s = strings.ReplaceAll(s, "/", "~1")
+	return s
+}
+
 func sortResourceListForDeletion(list *provisioning.ResourceList) {
 	// FIXME: this code should be simplified once unified storage folders support recursive deletion
 	// Sort by the following logic:
diff --git a/pkg/tests/apis/provisioning/repository_test.go b/pkg/tests/apis/provisioning/repository_test.go
index 7aee8dc5c73..36d60f9b353 100644
--- a/pkg/tests/apis/provisioning/repository_test.go
+++ b/pkg/tests/apis/provisioning/repository_test.go
@@ -15,6 +15,7 @@ import (
 	metav1 "k8s.io/apimachinery/pkg/apis/meta/v1"
 	"k8s.io/apimachinery/pkg/apis/meta/v1/unstructured"
 	"k8s.io/apimachinery/pkg/runtime"
+	"k8s.io/apimachinery/pkg/types"
 
 	provisioning "github.com/grafana/grafana/apps/provisioning/pkg/apis/provisioning/v0alpha1"
 	"github.com/grafana/grafana/pkg/apimachinery/utils"
@@ -682,3 +683,78 @@ func TestIntegrationProvisioning_ImportAllPanelsFromLocalRepository(t *testing.T
 	require.Error(t, err, "should delete the internal resource")
 	require.True(t, apierrors.IsNotFound(err))
 }
+
+func TestIntegrationProvisioning_DeleteRepositoryAndReleaseResources(t *testing.T) {
+	if testing.Short() {
+		t.Skip("skipping integration test")
+	}
+
+	helper := runGrafana(t)
+	ctx := context.Background()
+
+	const repo = "gh-repo"
+	testRepo := TestRepo{
+		Name:               repo,
+		Template:           "testdata/github-readonly.json.tmpl",
+		Target:             "folder",
+		ExpectedDashboards: 3,
+		ExpectedFolders:    3,
+	}
+	helper.CreateRepo(t, testRepo)
+
+	// Checking resources are there and are managed
+	foundFolders, err := helper.Folders.Resource.List(ctx, metav1.ListOptions{})
+	require.NoError(t, err, "can list folders")
+	for _, v := range foundFolders.Items {
+		assert.Contains(t, v.GetAnnotations(), utils.AnnoKeyManagerKind)
+		assert.Contains(t, v.GetAnnotations(), utils.AnnoKeyManagerIdentity)
+	}
+
+	foundDashboards, err := helper.DashboardsV1.Resource.List(ctx, metav1.ListOptions{})
+	require.NoError(t, err, "can list dashboards")
+	for _, v := range foundDashboards.Items {
+		assert.Contains(t, v.GetAnnotations(), utils.AnnoKeyManagerKind)
+		assert.Contains(t, v.GetAnnotations(), utils.AnnoKeyManagerIdentity)
+		assert.Contains(t, v.GetAnnotations(), utils.AnnoKeySourcePath)
+		assert.Contains(t, v.GetAnnotations(), utils.AnnoKeySourceChecksum)
+	}
+
+	_, err = helper.Repositories.Resource.Patch(ctx, repo, types.JSONPatchType, []byte(`[
+		{
+			"op": "replace",
+			"path": "/metadata/finalizers",
+			"value": ["cleanup", "release-orphan-resources"]
+		}
+	]`), metav1.PatchOptions{})
+	require.NoError(t, err, "should successfully patch finalizers")
+
+	err = helper.Repositories.Resource.Delete(ctx, repo, metav1.DeleteOptions{})
+	require.NoError(t, err, "should delete repository")
+
+	require.EventuallyWithT(t, func(collect *assert.CollectT) {
+		_, err := helper.Repositories.Resource.Get(ctx, repo, metav1.GetOptions{})
+		assert.True(collect, apierrors.IsNotFound(err), "repository should be deleted")
+	}, time.Second*10, time.Millisecond*50, "repository should be deleted")
+
+	require.EventuallyWithT(t, func(collect *assert.CollectT) {
+		foundDashboards, err := helper.DashboardsV1.Resource.List(ctx, metav1.ListOptions{})
+		assert.NoError(t, err, "can list values")
+		for _, v := range foundDashboards.Items {
+			assert.NotContains(t, v.GetAnnotations(), utils.AnnoKeyManagerKind)
+			assert.NotContains(t, v.GetAnnotations(), utils.AnnoKeyManagerIdentity)
+			assert.NotContains(t, v.GetAnnotations(), utils.AnnoKeySourcePath)
+			assert.NotContains(t, v.GetAnnotations(), utils.AnnoKeySourceChecksum)
+		}
+	}, time.Second*20, time.Millisecond*10, "Expected dashboards to be released")
+
+	require.EventuallyWithT(t, func(collect *assert.CollectT) {
+		foundFolders, err := helper.Folders.Resource.List(ctx, metav1.ListOptions{})
+		assert.NoError(t, err, "can list values")
+		for _, v := range foundFolders.Items {
+			assert.NotContains(t, v.GetAnnotations(), utils.AnnoKeyManagerKind)
+			assert.NotContains(t, v.GetAnnotations(), utils.AnnoKeyManagerIdentity)
+			assert.NotContains(t, v.GetAnnotations(), utils.AnnoKeySourcePath)
+			assert.NotContains(t, v.GetAnnotations(), utils.AnnoKeySourceChecksum)
+		}
+	}, time.Second*20, time.Millisecond*10, "Expected folders to be released")
+}