diff --git a/tests/docker-stacks-foundation/run-hooks-unset/a.sh b/tests/docker-stacks-foundation/run-hooks-unset/a.sh
new file mode 100644
index 0000000000..61701e2a82
--- /dev/null
+++ b/tests/docker-stacks-foundation/run-hooks-unset/a.sh
@@ -0,0 +1,6 @@
+#!/bin/bash
+# Copyright (c) Jupyter Development Team.
+# Distributed under the terms of the Modified BSD License.
+
+export MY_VAR=123
+echo "Inside a.sh MY_VAR variable has ${MY_VAR} value"
diff --git a/tests/docker-stacks-foundation/run-hooks-unset/b.sh b/tests/docker-stacks-foundation/run-hooks-unset/b.sh
new file mode 100644
index 0000000000..ab64e932b2
--- /dev/null
+++ b/tests/docker-stacks-foundation/run-hooks-unset/b.sh
@@ -0,0 +1,7 @@
+#!/bin/bash
+# Copyright (c) Jupyter Development Team.
+# Distributed under the terms of the Modified BSD License.
+
+echo "Inside b.sh MY_VAR variable has ${MY_VAR} value"
+echo "Unsetting MY_VAR"
+unset MY_VAR
diff --git a/tests/docker-stacks-foundation/run-hooks-unset/c.sh b/tests/docker-stacks-foundation/run-hooks-unset/c.sh
new file mode 100644
index 0000000000..ef69df395f
--- /dev/null
+++ b/tests/docker-stacks-foundation/run-hooks-unset/c.sh
@@ -0,0 +1,5 @@
+#!/bin/bash
+# Copyright (c) Jupyter Development Team.
+# Distributed under the terms of the Modified BSD License.
+
+echo "Inside c.sh MY_VAR variable has ${MY_VAR} value"
diff --git a/tests/docker-stacks-foundation/test_run_hooks.py b/tests/docker-stacks-foundation/test_run_hooks.py
index 0774f5f59d..483b68175f 100644
--- a/tests/docker-stacks-foundation/test_run_hooks.py
+++ b/tests/docker-stacks-foundation/test_run_hooks.py
@@ -127,3 +127,25 @@ def test_run_hooks_with_failures(container: TrackedContainer) -> None:
         )
 
     assert "OTHER_VAR=456" in logs
+
+
+def test_run_hooks_unset(container: TrackedContainer) -> None:
+    host_data_dir = THIS_DIR / "run-hooks-unset"
+    cont_data_dir = "/home/jovyan/data"
+    # https://forums.docker.com/t/all-files-appear-as-executable-in-file-paths-using-bind-mount/99921
+    # Unfortunately, Docker treats all files in mounter dir as executable files
+    # So we make a copy of mounted dir inside a container
+    command = (
+        "cp -r /home/jovyan/data/ /home/jovyan/data-copy/ &&"
+        "source /usr/local/bin/run-hooks.sh /home/jovyan/data-copy/"
+    )
+    logs = container.run_and_wait(
+        timeout=5,
+        volumes={str(host_data_dir): {"bind": cont_data_dir, "mode": "ro"}},
+        tty=True,
+        command=["bash", "-c", command],
+    )
+    assert "Inside a.sh MY_VAR variable has 123 value" in logs
+    assert "Inside b.sh MY_VAR variable has 123 value" in logs
+    assert "Unsetting MY_VAR" in logs
+    assert "Inside c.sh MY_VAR variable has  value" in logs