diff --git a/src/app/server/AppDelegate.h b/src/app/server/AppDelegate.h
index 56c4587f66139e..091a4149fcef7d 100644
--- a/src/app/server/AppDelegate.h
+++ b/src/app/server/AppDelegate.h
@@ -42,11 +42,16 @@ class AppDelegate
      * This is called when there is an error in establishing a commissioning session (such as, when an invalid passcode is provided)
      *
      * @param err CHIP_ERROR indicating the error that occurred during session establishment
+     *
+     * @return true if the commissioning window should be closed, false otherwise
      */
-    virtual void OnCommissioningSessionEstablishmentError(CHIP_ERROR err) {}
+    virtual bool OnCommissioningSessionEstablishmentError(CHIP_ERROR err) { return false; }
 
     /**
-     * This is called when the commissioning session establishment stops
+     * This is called in addition to OnCommissioningSessionEstablishmentError i.e. when there is an error in establishing a
+     * commissioning session AND the commissioning window is closed. The window may be closed because
+     * OnCommissioningSessionEstablishmentError returned 'true', the commissioning attempts limit was reached or listening for PASE
+     * failed.
      */
     virtual void OnCommissioningSessionStopped() {}
 
diff --git a/src/app/server/CommissioningWindowManager.cpp b/src/app/server/CommissioningWindowManager.cpp
index da428bbacf67f2..3e02e60cfd770d 100644
--- a/src/app/server/CommissioningWindowManager.cpp
+++ b/src/app/server/CommissioningWindowManager.cpp
@@ -151,17 +151,17 @@ void CommissioningWindowManager::HandleFailedAttempt(CHIP_ERROR err)
     mServer->GetBleLayerObject()->CloseAllBleConnections();
 #endif
 
-    CHIP_ERROR prevErr = err;
-    if (mFailedCommissioningAttempts < kMaxFailedCommissioningAttempts)
+    bool closeWindow = true;
+    if (mAppDelegate != nullptr)
     {
-        // If the number of commissioning attempts has not exceeded maximum
-        // retries, let's start listening for commissioning connections again.
-        err = AdvertiseAndListenForPASE();
+        closeWindow = mAppDelegate->OnCommissioningSessionEstablishmentError(err);
     }
 
-    if (mAppDelegate != nullptr)
+    if (!closeWindow && mFailedCommissioningAttempts < kMaxFailedCommissioningAttempts)
     {
-        mAppDelegate->OnCommissioningSessionEstablishmentError(prevErr);
+        // If the number of commissioning attempts has not exceeded maximum
+        // retries, let's start listening for commissioning connections again.
+        err = AdvertiseAndListenForPASE();
     }
 
     if (err != CHIP_NO_ERROR)