diff --git a/packages/toolkit/src/query/react/buildHooks.ts b/packages/toolkit/src/query/react/buildHooks.ts
index 2eebe2e7a3..daec42efe2 100644
--- a/packages/toolkit/src/query/react/buildHooks.ts
+++ b/packages/toolkit/src/query/react/buildHooks.ts
@@ -934,12 +934,13 @@ export function buildHooks<Definitions extends EndpointDefinitions>({
       !hasData &&
       isFetching
 
-    // isSuccess = true when data is present.
+    // isSuccess = true when data is present and we're not refetching after an error.
     // That includes cases where the _current_ item is either actively
     // fetching or about to fetch due to an uninitialized entry.
     const isSuccess =
       currentState.isSuccess ||
-      ((isFetching || currentState.isUninitialized) && hasData)
+      (hasData &&
+        ((isFetching && !lastResult?.isError) || currentState.isUninitialized))
 
     return {
       ...currentState,
diff --git a/packages/toolkit/src/query/tests/buildHooks.test.tsx b/packages/toolkit/src/query/tests/buildHooks.test.tsx
index 845f08f568..6810e75dd8 100644
--- a/packages/toolkit/src/query/tests/buildHooks.test.tsx
+++ b/packages/toolkit/src/query/tests/buildHooks.test.tsx
@@ -39,6 +39,7 @@ import type { MockInstance } from 'vitest'
 // the refetching behavior of components.
 let amount = 0
 let nextItemId = 0
+let refetchCount = 0
 
 interface Item {
   id: number
@@ -87,6 +88,17 @@ const api = createApi({
         },
       }),
     }),
+    getUserWithRefetchError: build.query<{ name: string }, number>({
+      queryFn: async (id) => {
+        refetchCount += 1
+
+        if (refetchCount > 1) {
+          return { error: true } as any
+        }
+
+        return { data: { name: 'Timmy' } }
+      },
+    }),
     getIncrementedAmount: build.query<{ amount: number }, void>({
       query: () => ({
         url: '',
@@ -431,6 +443,85 @@ describe('hooks tests', () => {
       ])
     })
 
+    test('isSuccess stays consistent if there is an error while refetching', async () => {
+      type LoadingState = {
+        id: number
+        isFetching: boolean
+        isSuccess: boolean
+        isError: boolean
+      }
+      const loadingHistory: LoadingState[] = []
+
+      function Component({ id = 1 }) {
+        const queryRes = api.endpoints.getUserWithRefetchError.useQuery(id)
+        const { refetch, data, status } = queryRes
+
+        useEffect(() => {
+          const { isFetching, isSuccess, isError } = queryRes
+          loadingHistory.push({ id, isFetching, isSuccess, isError })
+        }, [id, queryRes])
+
+        return (
+          <div>
+            <button
+              onClick={() => {
+                console.log('Refetching')
+                refetch()
+              }}
+            >
+              refetch
+            </button>
+            <div data-testid="name">{data?.name}</div>
+            <div data-testid="status">{status}</div>
+          </div>
+        )
+      }
+
+      render(<Component />, { wrapper: storeRef.wrapper })
+
+      await waitFor(() =>
+        expect(screen.getByTestId('name').textContent).toBe('Timmy'),
+      )
+
+      fireEvent.click(screen.getByText('refetch'))
+
+      await waitFor(() =>
+        expect(screen.getByTestId('status').textContent).toBe('pending'),
+      )
+
+      await waitFor(() =>
+        expect(screen.getByTestId('status').textContent).toBe('rejected'),
+      )
+
+      fireEvent.click(screen.getByText('refetch'))
+
+      await waitFor(() =>
+        expect(screen.getByTestId('status').textContent).toBe('pending'),
+      )
+
+      await waitFor(() =>
+        expect(screen.getByTestId('status').textContent).toBe('rejected'),
+      )
+
+      expect(loadingHistory).toEqual([
+        // Initial renders
+        { id: 1, isFetching: true, isSuccess: false, isError: false },
+        { id: 1, isFetching: true, isSuccess: false, isError: false },
+        // Data is returned
+        { id: 1, isFetching: false, isSuccess: true, isError: false },
+        // Started first refetch
+        { id: 1, isFetching: true, isSuccess: true, isError: false },
+        // First refetch errored
+        { id: 1, isFetching: false, isSuccess: false, isError: true },
+        // Started second refetch
+        // IMPORTANT We expect `isSuccess` to still be false,
+        // despite having started the refetch again.
+        { id: 1, isFetching: true, isSuccess: false, isError: false },
+        // Second refetch errored
+        { id: 1, isFetching: false, isSuccess: false, isError: true },
+      ])
+    })
+
     test('useQuery hook respects refetchOnMountOrArgChange: true', async () => {
       let data, isLoading, isFetching
       function User() {