diff --git a/projects/igniteui-angular/src/lib/core/utils.ts b/projects/igniteui-angular/src/lib/core/utils.ts
index 96301bbfc2f..61451d83813 100644
--- a/projects/igniteui-angular/src/lib/core/utils.ts
+++ b/projects/igniteui-angular/src/lib/core/utils.ts
@@ -24,13 +24,11 @@ export function cloneHierarchicalArray(array: any[], childDataKey: any): any[] {
     }
 
     for (const item of array) {
+        const clonedItem = cloneValue(item);
         if (Array.isArray(item[childDataKey])) {
-            const clonedItem = cloneValue(item);
             clonedItem[childDataKey] = cloneHierarchicalArray(clonedItem[childDataKey], childDataKey);
-            result.push(clonedItem);
-        } else {
-            result.push(item);
         }
+        result.push(clonedItem);
     }
     return result;
 }
diff --git a/projects/igniteui-angular/src/lib/data-operations/data-util.ts b/projects/igniteui-angular/src/lib/data-operations/data-util.ts
index 58a2616dc0f..ab191538643 100644
--- a/projects/igniteui-angular/src/lib/data-operations/data-util.ts
+++ b/projects/igniteui-angular/src/lib/data-operations/data-util.ts
@@ -242,35 +242,59 @@ export class DataUtil {
         data: any[],
         transactions: HierarchicalTransaction[],
         childDataKey: any,
-        primaryKey?: any,
-        parentKey?: any): any[] {
+        primaryKey?: any): any[] {
 
-        for (let index = 0; index < data.length; index++) {
-            const dataItem = data[index];
-            const rowId = primaryKey ? dataItem[primaryKey] : dataItem;
-            const updateTransaction = transactions.filter(t => t.type === TransactionType.UPDATE).find(t => t.id === rowId);
-            const addedTransactions = transactions.filter(t => t.type === TransactionType.ADD).filter(t => t.parentId === rowId);
-            if (updateTransaction || addedTransactions.length > 0) {
-                data[index] = mergeObjects(cloneValue(dataItem), updateTransaction && updateTransaction.newValue);
-            }
-            if (addedTransactions.length > 0) {
-                if (!data[index][childDataKey]) {
-                    data[index][childDataKey] = [];
+        for (let i = 0; i < transactions.length; i++) {
+            const transaction = transactions[i];
+            const path = transaction.path;
+
+            if (path) {
+                //  We need to get parent data row. If there is a path and path contains this row id,
+                //  this is the case for UPDATE and DELETE transactions type, remove the last id from
+                //  the path
+                if (path.find(id => id === transaction.id)) {
+                    path.splice(-1, 1);
                 }
-                for (const addedTransaction of addedTransactions) {
-                    data[index][childDataKey].push(addedTransaction.newValue);
+                const dataRow = this.getDataRowFromPath(data, primaryKey, childDataKey, path);
+                switch (transaction.type) {
+                    case TransactionType.ADD:
+                        //  if there is no dataRow, but there is a path this is ADD row added to
+                        //  DELETED ADD row - we just skip this
+                        if (dataRow) {
+                            if (!dataRow[childDataKey]) {
+                                dataRow[childDataKey] = [];
+                            }
+                            if (!dataRow[childDataKey].find(r => r[primaryKey] === transaction.id)) {
+                                dataRow[childDataKey].push(transaction.newValue);
+                            }
+                        }
+                        break;
+                    case TransactionType.UPDATE:
+                        const index = dataRow[childDataKey].findIndex(r => r[primaryKey] === transaction.id);
+                        const dataItem = dataRow[childDataKey][index];
+                        dataRow[childDataKey][index] = mergeObjects(cloneValue(dataItem), transaction.newValue);
+                        break;
                 }
-            }
-            if (data[index][childDataKey]) {
-                data[index][childDataKey] = this.mergeHierarchicalTransactions(
-                    data[index][childDataKey],
-                    transactions,
-                    childDataKey,
-                    primaryKey,
-                    rowId
-                );
+            } else {
+                //  if there is no path this is ADD row in root. Push the newValue to data
+                data.push(transaction.newValue);
             }
         }
         return data;
     }
+
+    private static getDataRowFromPath(data: any[], primaryKey: any, childDataKey: any, path: any[]): any {
+        let collection: any[] = data;
+        let result: any;
+        for (let i = 0; i < path.length; i++) {
+            const rowIndex = collection ? collection.findIndex(r => r[primaryKey] === path[i]) : undefined;
+            result = collection ? collection[rowIndex] : undefined;
+            if (!result) {
+                break;
+            }
+            collection = result[childDataKey];
+        }
+
+        return result;
+    }
 }
diff --git a/projects/igniteui-angular/src/lib/grids/api.service.ts b/projects/igniteui-angular/src/lib/grids/api.service.ts
index 10cd6fea868..684c1e549ad 100644
--- a/projects/igniteui-angular/src/lib/grids/api.service.ts
+++ b/projects/igniteui-angular/src/lib/grids/api.service.ts
@@ -316,9 +316,9 @@ export class GridBaseAPIService <T extends IgxGridBaseComponent> {
         }
         const args = {
             rowID,
-                oldValue: oldValue,
-                newValue: editValue,
-                cancel: false
+            oldValue: oldValue,
+            newValue: editValue,
+            cancel: false
         };
         if (cellObj) {
             Object.assign(args, {
@@ -360,25 +360,31 @@ export class GridBaseAPIService <T extends IgxGridBaseComponent> {
             //  if edit (new) value is same as old value do nothing here
             if (emittedArgs.oldValue !== undefined
                 && isEqual(emittedArgs.oldValue, emittedArgs.newValue)) { return; }
-            const transaction: Transaction = {
-                id: rowID, type: TransactionType.UPDATE, newValue: { [column.field]: emittedArgs.newValue }
-            };
-            if (grid.transactions.enabled) {
-                grid.transactions.add(transaction, currentGridEditState.rowData);
-            } else {
-                const rowValue = this.get_all_data(id)[rowIndex];
-                mergeObjects(rowValue, {[column.field]: emittedArgs.newValue });
-            }
+            const rowValue = this.get_all_data(id)[rowIndex];
+            this.updateCellData(grid, rowID, rowValue, currentGridEditState.rowData, { [column.field]: emittedArgs.newValue });
             if (grid.primaryKey === column.field && currentGridEditState.isRowSelected) {
                 grid.selection.deselect_item(id, rowID);
                 grid.selection.select_item(id, emittedArgs.newValue);
             }
-            if (!grid.rowEditable || !grid.rowInEditMode || grid.rowInEditMode.rowID !== rowID) {
+            if (!grid.rowEditable || !grid.rowInEditMode || grid.rowInEditMode.rowID !== rowID || !grid.transactions.enabled) {
                 (grid as any)._pipeTrigger++;
             }
         }
     }
 
+    protected updateCellData(grid, rowID, rowValue: any, rowData: any, newValue: {[x: string]: any}) {
+        if (grid.transactions.enabled) {
+            const transaction: Transaction = {
+                id: rowID,
+                type: TransactionType.UPDATE,
+                newValue
+            };
+            grid.transactions.add(transaction, rowData);
+        } else {
+            mergeObjects(rowValue, newValue);
+        }
+    }
+
     public update_row(value: any, id: string, rowID: any, gridState?: {
         args: IGridEditEventArgs,
         isRowSelected: boolean,
diff --git a/projects/igniteui-angular/src/lib/grids/tree-grid/tree-grid-api.service.ts b/projects/igniteui-angular/src/lib/grids/tree-grid/tree-grid-api.service.ts
index 85114348e66..df81b3fde75 100644
--- a/projects/igniteui-angular/src/lib/grids/tree-grid/tree-grid-api.service.ts
+++ b/projects/igniteui-angular/src/lib/grids/tree-grid/tree-grid-api.service.ts
@@ -5,6 +5,8 @@ import { ITreeGridRecord } from './tree-grid.interfaces';
 import { IRowToggleEventArgs } from './tree-grid.interfaces';
 import { IgxColumnComponent } from '../column.component';
 import { first } from 'rxjs/operators';
+import { HierarchicalTransaction, TransactionType } from '../../services';
+import { mergeObjects } from '../../core/utils';
 
 export class IgxTreeGridAPIService extends GridBaseAPIService<IgxTreeGridComponent> {
     public get_all_data(id: string, transactions?: boolean): any[] {
@@ -122,4 +124,22 @@ export class IgxTreeGridAPIService extends GridBaseAPIService<IgxTreeGridCompone
     public should_apply_number_style(column: IgxColumnComponent): boolean {
         return column.dataType === DataType.Number && column.visibleIndex !== 0;
     }
+
+    protected updateCellData(grid: IgxTreeGridComponent, rowID: any, rowValue: any, rowData: any, newValue: {[x: string]: any}) {
+        if (grid.transactions.enabled) {
+            const record: ITreeGridRecord = grid.records.get(rowID);
+            const path = [...record.path];
+            path.push(rowID);
+            const transaction: HierarchicalTransaction = {
+                id: rowID,
+                type: TransactionType.UPDATE,
+                newValue,
+                path: path
+            };
+            grid.transactions.add(transaction, rowData);
+        } else {
+            mergeObjects(rowValue, newValue);
+        }
+    }
+
 }
diff --git a/projects/igniteui-angular/src/lib/grids/tree-grid/tree-grid.component.ts b/projects/igniteui-angular/src/lib/grids/tree-grid/tree-grid.component.ts
index 3c0dbe741e6..2b3cf8372ce 100644
--- a/projects/igniteui-angular/src/lib/grids/tree-grid/tree-grid.component.ts
+++ b/projects/igniteui-angular/src/lib/grids/tree-grid/tree-grid.component.ts
@@ -368,9 +368,11 @@ export class IgxTreeGridComponent extends IgxGridBaseComponent {
                 const childKey = this.childDataKey;
                 if (this.transactions.enabled) {
                     const rowId = this.primaryKey ? data[this.primaryKey] : data;
+                    const path = [...parentRecord.path];
+                    path.push(parentRowID);
                     this.transactions.add({
                         id: rowId,
-                        parentId: parentRowID,
+                        path: path,
                         newValue: data,
                         type: TransactionType.ADD
                     } as HierarchicalTransaction,
@@ -397,13 +399,13 @@ export class IgxTreeGridComponent extends IgxGridBaseComponent {
      * @hidden
      */
     public deleteRowById(rowId: any) {
-        if (this.transactions.enabled && this.cascadeOnDelete) {
+        if (this.transactions.enabled && this.foreignKey && this.cascadeOnDelete) {
             this.transactions.startPending();
         }
 
         super.deleteRowById(rowId);
 
-        if (this.transactions.enabled && this.cascadeOnDelete) {
+        if (this.transactions.enabled && this.foreignKey && this.cascadeOnDelete) {
             this.transactions.endPending(true);
         }
     }
@@ -430,13 +432,15 @@ export class IgxTreeGridComponent extends IgxGridBaseComponent {
             index = this.primaryKey ? childData.map(c => c[this.primaryKey]).indexOf(rowID) :
                 childData.indexOf(rowID);
             if (this.transactions.enabled) {
+                const path = [...record.path];
+                path.push(rowID);
                 this.transactions.add({
                     id: rowID,
                     type: TransactionType.DELETE,
                     newValue: null,
-                    parentId: record.parent ? record.parent.rowID : undefined
+                    path: path
                 },
-                this.data);
+                childData[index]);
             } else {
                 childData.splice(index, 1);
             }
diff --git a/projects/igniteui-angular/src/lib/grids/tree-grid/tree-grid.pipes.ts b/projects/igniteui-angular/src/lib/grids/tree-grid/tree-grid.pipes.ts
index 7054c766465..0f59b4379d7 100644
--- a/projects/igniteui-angular/src/lib/grids/tree-grid/tree-grid.pipes.ts
+++ b/projects/igniteui-angular/src/lib/grids/tree-grid/tree-grid.pipes.ts
@@ -265,8 +265,10 @@ export class IgxTreeGridTransactionPipe implements PipeTransform {
     }
 
     transform(collection: any[], id: string, pipeTrigger: number): any[] {
+        console.log(collection);
         const grid: IgxTreeGridComponent = this.gridAPI.get(id);
-        if (collection && grid.transactions.enabled) {
+        const aggregatedChanges = grid.transactions.getAggregatedChanges(true);
+        if (collection && aggregatedChanges.length > 0) {
             const primaryKey = grid.primaryKey;
             if (!primaryKey) {
                 return collection;
@@ -281,9 +283,10 @@ export class IgxTreeGridTransactionPipe implements PipeTransform {
                     grid.transactions.getAggregatedChanges(true),
                     grid.primaryKey);
             } else if (childDataKey) {
+                const clone = cloneHierarchicalArray(collection, childDataKey);
                 return DataUtil.mergeHierarchicalTransactions(
-                    cloneHierarchicalArray(collection, childDataKey),
-                    grid.transactions.getAggregatedChanges(true),
+                    clone,
+                    aggregatedChanges,
                     childDataKey,
                     grid.primaryKey
                 );
diff --git a/projects/igniteui-angular/src/lib/services/transaction/igx-hierarchical-transaction.ts b/projects/igniteui-angular/src/lib/services/transaction/igx-hierarchical-transaction.ts
index 8fbf81657b1..4b6f6a8e537 100644
--- a/projects/igniteui-angular/src/lib/services/transaction/igx-hierarchical-transaction.ts
+++ b/projects/igniteui-angular/src/lib/services/transaction/igx-hierarchical-transaction.ts
@@ -12,7 +12,7 @@ export class IgxHierarchicalTransactionService<T extends HierarchicalTransaction
         this._states.forEach((state: S, key: any) => {
             const value = mergeChanges ? this.mergeValues(state.recordRef, state.value) : state.value;
             this.clearArraysFromObject(value);
-            result.push({ id: key, parentId: state.parentId, newValue: value, type: state.type } as T);
+            result.push({ id: key, path: state.path, newValue: value, type: state.type } as T);
         });
         return result;
     }
@@ -20,8 +20,8 @@ export class IgxHierarchicalTransactionService<T extends HierarchicalTransaction
     protected updateState(states: Map<any, S>, transaction: T, recordRef?: any): void {
         super.updateState(states, transaction, recordRef);
         const currentState = states.get(transaction.id);
-        if (currentState && transaction.type === TransactionType.ADD) {
-            currentState.parentId = transaction.parentId;
+        if (currentState) {
+            currentState.path = transaction.path;
         }
     }
 
diff --git a/projects/igniteui-angular/src/lib/services/transaction/transaction.ts b/projects/igniteui-angular/src/lib/services/transaction/transaction.ts
index 09164322d56..5bc55a04357 100644
--- a/projects/igniteui-angular/src/lib/services/transaction/transaction.ts
+++ b/projects/igniteui-angular/src/lib/services/transaction/transaction.ts
@@ -14,7 +14,7 @@ export interface Transaction {
 
 /** @experimental @hidden */
 export interface HierarchicalTransaction extends Transaction {
-    parentId: any;
+    path: any[];
 }
 
 export interface State {
@@ -25,7 +25,7 @@ export interface State {
 
 /** @experimental @hidden */
 export interface HierarchicalState extends State {
-    parentId: any;
+    path: any[];
 }
 
 export interface TransactionService<T extends Transaction, S extends State> {
diff --git a/src/app/app.module.ts b/src/app/app.module.ts
index 83ad99ef0bf..25273a080da 100644
--- a/src/app/app.module.ts
+++ b/src/app/app.module.ts
@@ -74,6 +74,7 @@ import { GridRowEditSampleComponent } from './grid-row-edit/grid-row-edit-sample
 import { GridWithTransactionsComponent } from './grid-row-edit/grid-with-transactions.component';
 import { TreeGridSampleComponent } from './tree-grid/tree-grid.sample';
 import { TreeGridFlatDataSampleComponent } from './tree-grid-flat-data/tree-grid-flat-data.sample';
+import { TreeGridWithTransactionsComponent } from './tree-grid/tree-grid-with-transactions.component';
 
 const components = [
     AppComponent,
@@ -131,6 +132,7 @@ const components = [
     GridWithTransactionsComponent,
     TreeGridSampleComponent,
     TreeGridFlatDataSampleComponent,
+    TreeGridWithTransactionsComponent,
     CustomContentComponent,
     ColorsSampleComponent,
     ShadowsSampleComponent,
diff --git a/src/app/tree-grid/tree-grid.sample.html b/src/app/tree-grid/tree-grid.sample.html
index edd5d50e4a4..a1418693e32 100644
--- a/src/app/tree-grid/tree-grid.sample.html
+++ b/src/app/tree-grid/tree-grid.sample.html
@@ -10,16 +10,18 @@
             <div class="density-chooser" style="margin-bottom: 16px">
                 <igx-buttongroup [values]="displayDensities" (onSelect)="selectDensity($event)" style="display: block; width: 500px"></igx-buttongroup>
             </div>
-            <igx-tree-grid #grid1 [data]="data" childDataKey="ChildCompanies" primaryKey="ID" expansionDepth="1"
-                rowSelectable="true" [paging]="false" [displayDensity]="density" [width]="'900px'" [height]="'500px'"
-                [showToolbar]="true" [columnHiding]="true" [columnPinning]="true" [exportExcel]="true" [exportCsv]="true"
-                exportText="Export" exportExcelText="Export to Excel" exportCsvText="Export to CSV">
-                <igx-column *ngFor="let c of columns" [field]="c.field" [header]="c.field" [pinned]="c.pinned"
-                    [movable]="c.movable" [groupable]="false" [resizable]="c.resizable" [width]="c.width"
-                    [sortable]="true" [filterable]="true" [editable]="true" [hidden]="c.hidden" [hasSummary]="c.summary"
-                    [minWidth]="c.minWidth" [maxWidth]="c.maxWidth">
-                </igx-column>
-            </igx-tree-grid>
+            <app-tree-grid-with-transactions>
+                <igx-tree-grid #grid1 [data]="data" childDataKey="ChildCompanies" primaryKey="ID" expansionDepth="1"
+                    rowSelectable="true" [paging]="false" [displayDensity]="density" [width]="'900px'" [height]="'500px'"
+                    [showToolbar]="true" [columnHiding]="true" [columnPinning]="true" [exportExcel]="true" [exportCsv]="true"
+                    exportText="Export" exportExcelText="Export to Excel" exportCsvText="Export to CSV">
+                    <igx-column *ngFor="let c of columns" [field]="c.field" [header]="c.field" [pinned]="c.pinned"
+                        [movable]="c.movable" [groupable]="false" [resizable]="c.resizable" [width]="c.width"
+                        [sortable]="true" [filterable]="true" [editable]="true" [hidden]="c.hidden" [hasSummary]="c.summary"
+                        [minWidth]="c.minWidth" [maxWidth]="c.maxWidth">
+                    </igx-column>
+                </igx-tree-grid>
+            </app-tree-grid-with-transactions>
 
             <div class="topMargin">
                 <igx-switch [(ngModel)]="grid1.paging">Enable Paging</igx-switch>
@@ -32,4 +34,4 @@
             </div>
         </div>
     </div>
-</div>
+</div>
\ No newline at end of file