diff --git a/agent/consul/enterprise_server_oss.go b/agent/consul/enterprise_server_oss.go
index 187d59e97..d6e07ddd8 100644
--- a/agent/consul/enterprise_server_oss.go
+++ b/agent/consul/enterprise_server_oss.go
@@ -57,6 +57,12 @@ func (s *Server) revokeEnterpriseLeadership() error {
 	return nil
 }
 
+func (s *Server) startTenancyDeferredDeletion(ctx context.Context) {
+}
+
+func (s *Server) stopTenancyDeferredDeletion() {
+}
+
 func (s *Server) validateEnterpriseRequest(entMeta *acl.EnterpriseMeta, write bool) error {
 	return nil
 }
diff --git a/agent/consul/leader.go b/agent/consul/leader.go
index 0d9359c14..d38e5015a 100644
--- a/agent/consul/leader.go
+++ b/agent/consul/leader.go
@@ -47,6 +47,9 @@ var LeaderSummaries = []prometheus.SummaryDefinition{
 const (
 	newLeaderEvent      = "consul:new-leader"
 	barrierWriteTimeout = 2 * time.Minute
+
+	defaultDeletionRoundBurst int        = 5  // number replication round bursts
+	defaultDeletionApplyRate  rate.Limit = 10 // raft applies per second
 )
 
 var (
@@ -313,6 +316,8 @@ func (s *Server) establishLeadership(ctx context.Context) error {
 
 	s.startPeeringStreamSync(ctx)
 
+	s.startDeferredDeletion(ctx)
+
 	if err := s.startConnectLeader(ctx); err != nil {
 		return err
 	}
@@ -751,6 +756,16 @@ func (s *Server) stopACLReplication() {
 	s.leaderRoutineManager.Stop(aclTokenReplicationRoutineName)
 }
 
+func (s *Server) startDeferredDeletion(ctx context.Context) {
+	s.startPeeringDeferredDeletion(ctx)
+	s.startTenancyDeferredDeletion(ctx)
+}
+
+func (s *Server) stopDeferredDeletion() {
+	s.leaderRoutineManager.Stop(peeringDeletionRoutineName)
+	s.stopTenancyDeferredDeletion()
+}
+
 func (s *Server) startConfigReplication(ctx context.Context) {
 	if s.config.PrimaryDatacenter == "" || s.config.PrimaryDatacenter == s.config.Datacenter {
 		// replication shouldn't run in the primary DC
diff --git a/agent/consul/leader_peering.go b/agent/consul/leader_peering.go
index 5efc52edf..dea09ebed 100644
--- a/agent/consul/leader_peering.go
+++ b/agent/consul/leader_peering.go
@@ -12,12 +12,17 @@ import (
 	"github.com/hashicorp/go-memdb"
 	"github.com/hashicorp/go-multierror"
 	"github.com/hashicorp/go-uuid"
+	"golang.org/x/time/rate"
 	"google.golang.org/grpc"
 	"google.golang.org/grpc/credentials"
 
+	"github.com/hashicorp/consul/acl"
+	"github.com/hashicorp/consul/agent/consul/state"
 	"github.com/hashicorp/consul/agent/pool"
 	"github.com/hashicorp/consul/agent/rpc/peering"
 	"github.com/hashicorp/consul/agent/structs"
+	"github.com/hashicorp/consul/api"
+	"github.com/hashicorp/consul/logging"
 	"github.com/hashicorp/consul/proto/pbpeering"
 )
 
@@ -297,3 +302,149 @@ func newPeerDialer(peerAddr string) func(context.Context, string) (net.Conn, err
 		return conn, nil
 	}
 }
+
+func (s *Server) startPeeringDeferredDeletion(ctx context.Context) {
+	s.leaderRoutineManager.Start(ctx, peeringDeletionRoutineName, s.runPeeringDeletions)
+}
+
+// runPeeringDeletions watches for peerings marked for deletions and then cleans up data for them.
+func (s *Server) runPeeringDeletions(ctx context.Context) error {
+	logger := s.loggers.Named(logging.Peering)
+
+	// This limiter's purpose is to control the rate of raft applies caused by the deferred deletion
+	// process. This includes deletion of the peerings themselves in addition to any peering data
+	raftLimiter := rate.NewLimiter(defaultDeletionApplyRate, int(defaultDeletionApplyRate))
+	for {
+		ws := memdb.NewWatchSet()
+		state := s.fsm.State()
+		_, peerings, err := s.fsm.State().PeeringListDeleted(ws)
+		if err != nil {
+			logger.Warn("encountered an error while searching for deleted peerings", "error", err)
+			continue
+		}
+
+		if len(peerings) == 0 {
+			ws.Add(state.AbandonCh())
+
+			// wait for a peering to be deleted or the routine to be cancelled
+			if err := ws.WatchCtx(ctx); err != nil {
+				return err
+			}
+			continue
+		}
+
+		for _, p := range peerings {
+			s.removePeeringAndData(ctx, logger, raftLimiter, p.Name, acl.PartitionOrDefault(p.Partition))
+		}
+	}
+}
+
+// removepPeeringAndData removes data imported for a peering and the peering itself.
+func (s *Server) removePeeringAndData(ctx context.Context, logger hclog.Logger, limiter *rate.Limiter, peer string, partition string) {
+	logger = logger.With("peer", peer, "partition", partition)
+
+	// First delete all imported data.
+	// By deleting all imported nodes we also delete all services and checks registered on them.
+	if err := s.deleteAllNodes(ctx, limiter, *structs.NodeEnterpriseMetaInPartition(partition), peer); err != nil {
+		logger.Error("Failed to remove Nodes for peer", "error", err)
+		return
+	}
+	if err := s.deleteTrustBundleFromPeer(ctx, limiter, *structs.NodeEnterpriseMetaInPartition(partition), peer); err != nil {
+		logger.Error("Failed to remove trust bundle for peer", "error", err)
+		return
+	}
+
+	if err := limiter.Wait(ctx); err != nil {
+		return
+	}
+
+	// Once all imported data is deleted, the peering itself is also deleted.
+	req := pbpeering.PeeringDeleteRequest{
+		Name:      peer,
+		Partition: partition,
+	}
+	_, err := s.raftApplyProtobuf(structs.PeeringDeleteType, &req)
+	if err != nil {
+		logger.Error("failed to apply full peering deletion", "error", err)
+		return
+	}
+}
+
+// deleteAllNodes will delete all nodes in a partition or all nodes imported from a given peer name.
+func (s *Server) deleteAllNodes(ctx context.Context, limiter *rate.Limiter, entMeta acl.EnterpriseMeta, peerName string) error {
+	// Same as ACL batch upsert size
+	nodeBatchSizeBytes := 256 * 1024
+
+	_, nodes, err := s.fsm.State().NodeDump(nil, &entMeta, peerName)
+	if err != nil {
+		return err
+	}
+	if len(nodes) == 0 {
+		return nil
+	}
+
+	i := 0
+	for {
+		var ops structs.TxnOps
+		for batchSize := 0; batchSize < nodeBatchSizeBytes && i < len(nodes); i++ {
+			entry := nodes[i]
+
+			op := structs.TxnOp{
+				Node: &structs.TxnNodeOp{
+					Verb: api.NodeDelete,
+					Node: structs.Node{
+						Node:      entry.Node,
+						Partition: entry.Partition,
+						PeerName:  entry.PeerName,
+					},
+				},
+			}
+			ops = append(ops, &op)
+
+			// Add entries to the transaction until it reaches the max batch size
+			batchSize += len(entry.Node) + len(entry.Partition)
+		}
+
+		// Send each batch as a TXN Req to avoid sending one at a time
+		req := structs.TxnRequest{
+			Datacenter: s.config.Datacenter,
+			Ops:        ops,
+		}
+		if len(req.Ops) > 0 {
+			if err := limiter.Wait(ctx); err != nil {
+				return err
+			}
+
+			_, err := s.raftApplyMsgpack(structs.TxnRequestType, &req)
+			if err != nil {
+				return err
+			}
+		} else {
+			break
+		}
+	}
+
+	return nil
+}
+
+// deleteTrustBundleFromPeer deletes the trust bundle imported from a peer, if present.
+func (s *Server) deleteTrustBundleFromPeer(ctx context.Context, limiter *rate.Limiter, entMeta acl.EnterpriseMeta, peerName string) error {
+	_, bundle, err := s.fsm.State().PeeringTrustBundleRead(nil, state.Query{Value: peerName, EnterpriseMeta: entMeta})
+	if err != nil {
+		return err
+	}
+	if bundle == nil {
+		return nil
+	}
+
+	if err := limiter.Wait(ctx); err != nil {
+		return err
+	}
+
+	req := pbpeering.PeeringTrustBundleDeleteRequest{
+		Name:      peerName,
+		Partition: entMeta.PartitionOrDefault(),
+	}
+	_, err = s.raftApplyProtobuf(structs.PeeringTrustBundleDeleteType, &req)
+	return err
+}
diff --git a/agent/consul/leader_peering_test.go b/agent/consul/leader_peering_test.go
index feb520e14..e881b144e 100644
--- a/agent/consul/leader_peering_test.go
+++ b/agent/consul/leader_peering_test.go
@@ -7,6 +7,8 @@ import (
 	"testing"
 	"time"
 
+	"github.com/hashicorp/consul/acl"
+	"github.com/hashicorp/consul/api"
 	"github.com/stretchr/testify/require"
 	"google.golang.org/grpc"
 
@@ -107,7 +109,7 @@ func TestLeader_PeeringSync_Lifecycle_ClientDeletion(t *testing.T) {
 			Value: "my-peer-s2",
 		})
 		require.NoError(r, err)
-		require.Equal(r, pbpeering.PeeringState_TERMINATED, peering.State)
+		require.Nil(r, peering)
 	})
 }
 
@@ -196,6 +198,162 @@ func TestLeader_PeeringSync_Lifecycle_ServerDeletion(t *testing.T) {
 			Value: "my-peer-s1",
 		})
 		require.NoError(r, err)
-		require.Equal(r, pbpeering.PeeringState_TERMINATED, peering.State)
+		require.Nil(r, peering)
 	})
 }
+
+func TestLeader_Peering_DeferredDeletion(t *testing.T) {
+	if testing.Short() {
+		t.Skip("too slow for testing.Short")
+	}
+
+	// TODO(peering): Configure with TLS
+	_, s1 := testServerWithConfig(t, func(c *Config) {
+		c.NodeName = "s1.dc1"
+		c.Datacenter = "dc1"
+		c.TLSConfig.Domain = "consul"
+	})
+	testrpc.WaitForLeader(t, s1.RPC, "dc1")
+
+	var (
+		peerName    = "my-peer-s2"
+		defaultMeta = acl.DefaultEnterpriseMeta()
+		lastIdx     = uint64(0)
+	)
+
+	// Simulate a peering initiation event by writing a peering to the state store.
+	lastIdx++
+	require.NoError(t, s1.fsm.State().PeeringWrite(lastIdx, &pbpeering.Peering{
+		Name: peerName,
+	}))
+
+	// Insert imported data: nodes, services, checks, trust bundle
+	lastIdx = insertTestPeeringData(t, s1.fsm.State(), peerName, lastIdx)
+
+	// Mark the peering for deletion to trigger the termination sequence.
+	lastIdx++
+	require.NoError(t, s1.fsm.State().PeeringWrite(lastIdx, &pbpeering.Peering{
+		Name:      peerName,
+		DeletedAt: structs.TimeToProto(time.Now()),
+	}))
+
+	// Ensure imported data is gone:
+	retry.Run(t, func(r *retry.R) {
+		_, csn, err := s1.fsm.State().ServiceDump(nil, "", false, defaultMeta, peerName)
+		require.NoError(r, err)
+		require.Len(r, csn, 0)
+
+		_, checks, err := s1.fsm.State().ChecksInState(nil, api.HealthAny, defaultMeta, peerName)
+		require.NoError(r, err)
+		require.Len(r, checks, 0)
+
+		_, nodes, err := s1.fsm.State().NodeDump(nil, defaultMeta, peerName)
+		require.NoError(r, err)
+		require.Len(r, nodes, 0)
+
+		_, tb, err := s1.fsm.State().PeeringTrustBundleRead(nil, state.Query{Value: peerName})
+		require.NoError(r, err)
+		require.Nil(r, tb)
+	})
+
+	// The leader routine should pick up the deletion and finish deleting the peering.
+	retry.Run(t, func(r *retry.R) {
+		_, peering, err := s1.fsm.State().PeeringRead(nil, state.Query{
+			Value: peerName,
+		})
+		require.NoError(r, err)
+		require.Nil(r, peering)
+	})
+}
+
+func insertTestPeeringData(t *testing.T, store *state.Store, peer string, lastIdx uint64) uint64 {
+	lastIdx++
+	require.NoError(t, store.PeeringTrustBundleWrite(lastIdx, &pbpeering.PeeringTrustBundle{
+		TrustDomain: "952e6bd1-f4d6-47f7-83ff-84b31babaa17",
+		PeerName:    peer,
+		RootPEMs:    []string{"certificate bundle"},
+	}))
+
+	lastIdx++
+	require.NoError(t, store.EnsureRegistration(lastIdx, &structs.RegisterRequest{
+		Node:     "aaa",
+		Address:  "10.0.0.1",
+		PeerName: peer,
+		Service: &structs.NodeService{
+			Service:  "a-service",
+			ID:       "a-service-1",
+			Port:     8080,
+			PeerName: peer,
+		},
+		Checks: structs.HealthChecks{
+			{
+				CheckID:     "a-service-1-check",
+				ServiceName: "a-service",
+				ServiceID:   "a-service-1",
+				Node:        "aaa",
+				PeerName:    peer,
+			},
+			{
+				CheckID:  structs.SerfCheckID,
+				Node:     "aaa",
+				PeerName: peer,
+			},
+		},
+	}))
+
+	lastIdx++
+	require.NoError(t, store.EnsureRegistration(lastIdx, &structs.RegisterRequest{
+		Node:     "bbb",
+		Address:  "10.0.0.2",
+		PeerName: peer,
+		Service: &structs.NodeService{
+			Service:  "b-service",
+			ID:       "b-service-1",
+			Port:     8080,
+			PeerName: peer,
+		},
+		Checks: structs.HealthChecks{
+			{
+				CheckID:     "b-service-1-check",
+				ServiceName: "b-service",
+				ServiceID:   "b-service-1",
+				Node:        "bbb",
+				PeerName:    peer,
+			},
+			{
+				CheckID:  structs.SerfCheckID,
+				Node:     "bbb",
+				PeerName: peer,
+			},
+		},
+	}))
+
+	lastIdx++
+	require.NoError(t, store.EnsureRegistration(lastIdx, &structs.RegisterRequest{
+		Node:     "ccc",
+		Address:  "10.0.0.3",
+		PeerName: peer,
+		Service: &structs.NodeService{
+			Service:  "c-service",
+			ID:       "c-service-1",
+			Port:     8080,
+			PeerName: peer,
+		},
+		Checks: structs.HealthChecks{
+			{
+				CheckID:     "c-service-1-check",
+				ServiceName: "c-service",
+				ServiceID:   "c-service-1",
+				Node:        "ccc",
+				PeerName:    peer,
+			},
+			{
+				CheckID:  structs.SerfCheckID,
+				Node:     "ccc",
+				PeerName: peer,
+			},
+		},
+	}))
+
+	return lastIdx
+}
diff --git a/agent/consul/server.go b/agent/consul/server.go
index 344efb167..0b8702cba 100644
--- a/agent/consul/server.go
+++ b/agent/consul/server.go
@@ -126,6 +126,7 @@ const (
 	backgroundCAInitializationRoutineName = "CA initialization"
 	virtualIPCheckRoutineName             = "virtual IP version check"
 	peeringStreamsRoutineName             = "streaming peering resources"
+	peeringDeletionRoutineName            = "peering deferred deletion"
 )
 
 var (
diff --git a/agent/peering_endpoint_test.go b/agent/peering_endpoint_test.go
index 412ea4ae4..07dd9bfaf 100644
--- a/agent/peering_endpoint_test.go
+++ b/agent/peering_endpoint_test.go
@@ -12,13 +12,12 @@ import (
 	"testing"
 	"time"
 
-	"github.com/stretchr/testify/require"
-	"google.golang.org/protobuf/encoding/protojson"
-
 	"github.com/hashicorp/consul/agent/structs"
 	"github.com/hashicorp/consul/api"
 	"github.com/hashicorp/consul/proto/pbpeering"
+	"github.com/hashicorp/consul/sdk/testutil/retry"
 	"github.com/hashicorp/consul/testrpc"
+	"github.com/stretchr/testify/require"
 )
 
 var validCA = `
@@ -344,18 +343,14 @@ func TestHTTP_Peering_Delete(t *testing.T) {
 		require.Equal(t, "", resp.Body.String())
 	})
 
-	t.Run("now the token is marked for deletion", func(t *testing.T) {
-		req, err := http.NewRequest("GET", "/v1/peering/foo", nil)
-		require.NoError(t, err)
-		resp := httptest.NewRecorder()
-		a.srv.h.ServeHTTP(resp, req)
-		require.Equal(t, http.StatusOK, resp.Code)
-
-		var p pbpeering.Peering
-		body, err := io.ReadAll(resp.Body)
-		require.NoError(t, err)
-		require.NoError(t, protojson.Unmarshal(body, &p))
-		require.False(t, p.IsActive())
+	t.Run("now the token is deleted and reads should yield a 404", func(t *testing.T) {
+		retry.Run(t, func(r *retry.R) {
+			req, err := http.NewRequest("GET", "/v1/peering/foo", nil)
+			require.NoError(t, err)
+			resp := httptest.NewRecorder()
+			a.srv.h.ServeHTTP(resp, req)
+			require.Equal(r, http.StatusNotFound, resp.Code)
+		})
 	})
 
 	t.Run("delete a token that does not exist", func(t *testing.T) {
diff --git a/agent/rpc/peering/service_test.go b/agent/rpc/peering/service_test.go
index 2cedfc80b..1e462dd9e 100644
--- a/agent/rpc/peering/service_test.go
+++ b/agent/rpc/peering/service_test.go
@@ -11,6 +11,7 @@ import (
 	"testing"
 	"time"
 
+	"github.com/hashicorp/consul/sdk/testutil/retry"
 	"github.com/hashicorp/go-hclog"
 	"github.com/hashicorp/go-uuid"
 	"github.com/stretchr/testify/require"
@@ -297,11 +298,14 @@ func TestPeeringService_Delete(t *testing.T) {
 	_, err = client.PeeringDelete(ctx, &pbpeering.PeeringDeleteRequest{Name: "foo"})
 	require.NoError(t, err)
 
-	// "foo" peering must only be marked for deletion, rather than actually be deleted.
-	_, resp, err := s.Server.FSM().State().PeeringRead(nil, state.Query{Value: "foo"})
-	require.NoError(t, err)
-	require.NotNil(t, resp.DeletedAt)
-	require.False(t, resp.IsActive())
+	retry.Run(t, func(r *retry.R) {
+		_, resp, err := s.Server.FSM().State().PeeringRead(nil, state.Query{Value: "foo"})
+		require.NoError(r, err)
+
+		// Initially the peering will be marked for deletion but eventually the leader
+		// routine will clean it up.
+		require.Nil(r, resp)
+	})
 }
 
 func TestPeeringService_List(t *testing.T) {
diff --git a/api/peering_test.go b/api/peering_test.go
index ea93e6345..015da723f 100644
--- a/api/peering_test.go
+++ b/api/peering_test.go
@@ -212,11 +212,12 @@ func TestAPI_Peering_GenerateToken_Read_Establish_Delete(t *testing.T) {
 		require.NoError(t, err)
 		require.NotNil(t, wm)
 
-		// Read to see if the token is marked for deletion
-		resp, qm, err := c.Peerings().Read(ctx, "peer1", nil)
-		require.NoError(t, err)
-		require.NotNil(t, qm)
-		require.NotNil(t, resp)
-		require.False(t, resp.DeletedAt.IsZero())
+		// Read to see if the token is gone
+		retry.Run(t, func(r *retry.R) {
+			resp, qm, err := c.Peerings().Read(ctx, "peer1", nil)
+			require.NoError(r, err)
+			require.NotNil(r, qm)
+			require.Nil(r, resp)
+		})
 	})
 }