diff --git a/applicationset/controllers/applicationset_controller.go b/applicationset/controllers/applicationset_controller.go
index f2689dede9cec..dd65d51055162 100644
--- a/applicationset/controllers/applicationset_controller.go
+++ b/applicationset/controllers/applicationset_controller.go
@@ -17,6 +17,7 @@ package controllers
 import (
 	"context"
 	"fmt"
+	"strings"
 	"time"
 
 	"github.com/google/go-cmp/cmp"
@@ -718,6 +719,17 @@ func (r *ApplicationSetReconciler) createOrUpdateInCluster(ctx context.Context,
 				}
 			}
 
+			// Preserve post-delete finalizers:
+			//   https://github.com/argoproj/argo-cd/issues/17181
+			for _, finalizer := range found.ObjectMeta.Finalizers {
+				if strings.HasPrefix(finalizer, argov1alpha1.PostDeleteFinalizerName) {
+					if generatedApp.Finalizers == nil {
+						generatedApp.Finalizers = []string{}
+					}
+					generatedApp.Finalizers = append(generatedApp.Finalizers, finalizer)
+				}
+			}
+
 			found.ObjectMeta.Annotations = generatedApp.Annotations
 
 			found.ObjectMeta.Finalizers = generatedApp.Finalizers
diff --git a/applicationset/controllers/applicationset_controller_test.go b/applicationset/controllers/applicationset_controller_test.go
index 3ed7eeccd7788..ac1a17447ccea 100644
--- a/applicationset/controllers/applicationset_controller_test.go
+++ b/applicationset/controllers/applicationset_controller_test.go
@@ -1281,6 +1281,71 @@ func TestCreateOrUpdateInCluster(t *testing.T) {
 					},
 				},
 			},
+		}, {
+			name: "Ensure that argocd post-delete finalizers are preserved from an existing app",
+			appSet: v1alpha1.ApplicationSet{
+				ObjectMeta: metav1.ObjectMeta{
+					Name:      "name",
+					Namespace: "namespace",
+				},
+				Spec: v1alpha1.ApplicationSetSpec{
+					Template: v1alpha1.ApplicationSetTemplate{
+						Spec: v1alpha1.ApplicationSpec{
+							Project: "project",
+						},
+					},
+				},
+			},
+			existingApps: []v1alpha1.Application{
+				{
+					TypeMeta: metav1.TypeMeta{
+						Kind:       application.ApplicationKind,
+						APIVersion: "argoproj.io/v1alpha1",
+					},
+					ObjectMeta: metav1.ObjectMeta{
+						Name:            "app1",
+						Namespace:       "namespace",
+						ResourceVersion: "2",
+						Finalizers: []string{
+							v1alpha1.PostDeleteFinalizerName,
+							v1alpha1.PostDeleteFinalizerName + "/mystage",
+						},
+					},
+					Spec: v1alpha1.ApplicationSpec{
+						Project: "project",
+					},
+				},
+			},
+			desiredApps: []v1alpha1.Application{
+				{
+					ObjectMeta: metav1.ObjectMeta{
+						Name: "app1",
+					},
+					Spec: v1alpha1.ApplicationSpec{
+						Project: "project",
+					},
+				},
+			},
+			expected: []v1alpha1.Application{
+				{
+					TypeMeta: metav1.TypeMeta{
+						Kind:       application.ApplicationKind,
+						APIVersion: "argoproj.io/v1alpha1",
+					},
+					ObjectMeta: metav1.ObjectMeta{
+						Name:            "app1",
+						Namespace:       "namespace",
+						ResourceVersion: "2",
+						Finalizers: []string{
+							v1alpha1.PostDeleteFinalizerName,
+							v1alpha1.PostDeleteFinalizerName + "/mystage",
+						},
+					},
+					Spec: v1alpha1.ApplicationSpec{
+						Project: "project",
+					},
+				},
+			},
 		},
 	} {