diff --git a/src/libs/actions/Report.ts b/src/libs/actions/Report.ts
index 12484f9a5d6e..de66d298de81 100644
--- a/src/libs/actions/Report.ts
+++ b/src/libs/actions/Report.ts
@@ -5059,31 +5059,54 @@ function deleteAppReport(reportID: string | undefined) {
         value: reportActionsForReport,
     });
 
-    // 7. Delete the report
+    // 7. Mark the iouReport as being deleted and then delete it
     optimisticData.push({
         onyxMethod: Onyx.METHOD.MERGE,
         key: `${ONYXKEYS.COLLECTION.REPORT}${reportID}`,
+        value: {
+            pendingFields: {
+                preview: CONST.RED_BRICK_ROAD_PENDING_ACTION.DELETE,
+            },
+        },
+    });
+
+    successData.push({
+        onyxMethod: Onyx.METHOD.SET,
+        key: `${ONYXKEYS.COLLECTION.REPORT}${reportID}`,
         value: null,
     });
 
     // @ts-expect-error - will be solved in https://github.com/Expensify/App/issues/73830
     failureData.push({
-        onyxMethod: Onyx.METHOD.MERGE,
+        onyxMethod: Onyx.METHOD.SET,
         key: `${ONYXKEYS.COLLECTION.REPORT}${reportID}`,
         value: report,
     });
 
-    // 8. Delete chat report preview
+    // 8. Mark chat report preview action as deleted
     const reportActionID = report?.parentReportActionID;
-    const reportAction = allReportActions?.[reportID];
     const parentReportID = report?.parentReportID;
+    const parentReportAction = parentReportID && reportActionID ? allReportActions?.[parentReportID]?.[reportActionID] : undefined;
 
     if (reportActionID) {
         optimisticData.push({
             onyxMethod: Onyx.METHOD.MERGE,
             key: `${ONYXKEYS.COLLECTION.REPORT_ACTIONS}${parentReportID}`,
             value: {
-                [reportActionID]: null,
+                [reportActionID]: {
+                    pendingAction: CONST.RED_BRICK_ROAD_PENDING_ACTION.DELETE,
+                },
+            },
+        });
+
+        successData.push({
+            onyxMethod: Onyx.METHOD.MERGE,
+            key: `${ONYXKEYS.COLLECTION.REPORT_ACTIONS}${parentReportID}`,
+            value: {
+                [reportActionID]: {
+                    pendingAction: null,
+                    errors: null,
+                },
             },
         });
 
@@ -5091,7 +5114,10 @@ function deleteAppReport(reportID: string | undefined) {
             onyxMethod: Onyx.METHOD.MERGE,
             key: `${ONYXKEYS.COLLECTION.REPORT_ACTIONS}${parentReportID}`,
             value: {
-                [reportActionID]: reportAction,
+                [reportActionID]: {
+                    ...parentReportAction,
+                    errors: getMicroSecondOnyxErrorWithTranslationKey('iou.error.genericDeleteFailureMessage'),
+                },
             },
         });
     }