diff --git a/models/git/branch.go b/models/git/branch.go
index 9ac6c45578..beeb7c0689 100644
--- a/models/git/branch.go
+++ b/models/git/branch.go
@@ -235,6 +235,11 @@ func GetDeletedBranchByID(ctx context.Context, repoID, branchID int64) (*Branch,
 	return &branch, nil
 }
 
+func DeleteRepoBranches(ctx context.Context, repoID int64) error {
+	_, err := db.GetEngine(ctx).Where("repo_id=?", repoID).Delete(new(Branch))
+	return err
+}
+
 func DeleteBranches(ctx context.Context, repoID, doerID int64, branchIDs []int64) error {
 	return db.WithTx(ctx, func(ctx context.Context) error {
 		branches := make([]*Branch, 0, len(branchIDs))
diff --git a/models/repo/release.go b/models/repo/release.go
index 1c2e4a48e3..663d310bc0 100644
--- a/models/repo/release.go
+++ b/models/repo/release.go
@@ -558,3 +558,8 @@ func FindTagsByCommitIDs(ctx context.Context, repoID int64, commitIDs ...string)
 	}
 	return res, nil
 }
+
+func DeleteRepoReleases(ctx context.Context, repoID int64) error {
+	_, err := db.GetEngine(ctx).Where("repo_id = ?", repoID).Delete(new(Release))
+	return err
+}
diff --git a/modules/repository/init.go b/modules/repository/init.go
index ace21254ba..e6331966ba 100644
--- a/modules/repository/init.go
+++ b/modules/repository/init.go
@@ -11,11 +11,7 @@ import (
 	"strings"
 
 	issues_model "code.gitea.io/gitea/models/issues"
-	repo_model "code.gitea.io/gitea/models/repo"
-	"code.gitea.io/gitea/modules/git"
-	"code.gitea.io/gitea/modules/gitrepo"
 	"code.gitea.io/gitea/modules/label"
-	"code.gitea.io/gitea/modules/log"
 	"code.gitea.io/gitea/modules/options"
 	"code.gitea.io/gitea/modules/setting"
 	"code.gitea.io/gitea/modules/util"
@@ -121,29 +117,6 @@ func LoadRepoConfig() error {
 	return nil
 }
 
-func CheckInitRepository(ctx context.Context, repo *repo_model.Repository) (err error) {
-	// Somehow the directory could exist.
-	isExist, err := gitrepo.IsRepositoryExist(ctx, repo)
-	if err != nil {
-		log.Error("Unable to check if %s exists. Error: %v", repo.FullName(), err)
-		return err
-	}
-	if isExist {
-		return repo_model.ErrRepoFilesAlreadyExist{
-			Uname: repo.OwnerName,
-			Name:  repo.Name,
-		}
-	}
-
-	// Init git bare new repository.
-	if err = git.InitRepository(ctx, repo.RepoPath(), true, repo.ObjectFormatName); err != nil {
-		return fmt.Errorf("git.InitRepository: %w", err)
-	} else if err = gitrepo.CreateDelegateHooks(ctx, repo); err != nil {
-		return fmt.Errorf("createDelegateHooks: %w", err)
-	}
-	return nil
-}
-
 // InitializeLabels adds a label set to a repository using a template
 func InitializeLabels(ctx context.Context, id int64, labelTemplate string, isOrg bool) error {
 	list, err := LoadTemplateLabelsByDisplayName(labelTemplate)
diff --git a/services/repository/adopt.go b/services/repository/adopt.go
index b7321156d9..6953970e28 100644
--- a/services/repository/adopt.go
+++ b/services/repository/adopt.go
@@ -16,7 +16,6 @@ import (
 	repo_model "code.gitea.io/gitea/models/repo"
 	user_model "code.gitea.io/gitea/models/user"
 	"code.gitea.io/gitea/modules/container"
-	"code.gitea.io/gitea/modules/git"
 	"code.gitea.io/gitea/modules/gitrepo"
 	"code.gitea.io/gitea/modules/log"
 	"code.gitea.io/gitea/modules/optional"
@@ -28,6 +27,18 @@ import (
 	"github.com/gobwas/glob"
 )
 
+func deleteFailedAdoptRepository(repoID int64) error {
+	return db.WithTx(db.DefaultContext, func(ctx context.Context) error {
+		if err := deleteDBRepository(ctx, repoID); err != nil {
+			return fmt.Errorf("deleteDBRepository: %w", err)
+		}
+		if err := git_model.DeleteRepoBranches(ctx, repoID); err != nil {
+			return fmt.Errorf("deleteRepoBranches: %w", err)
+		}
+		return repo_model.DeleteRepoReleases(ctx, repoID)
+	})
+}
+
 // AdoptRepository adopts pre-existing repository files for the user/organization.
 func AdoptRepository(ctx context.Context, doer, u *user_model.User, opts CreateRepoOptions) (*repo_model.Repository, error) {
 	if !doer.IsAdmin && !u.CanCreateRepo() {
@@ -48,58 +59,51 @@ func AdoptRepository(ctx context.Context, doer, u *user_model.User, opts CreateR
 		IsPrivate:                       opts.IsPrivate,
 		IsFsckEnabled:                   !opts.IsMirror,
 		CloseIssuesViaCommitInAnyBranch: setting.Repository.DefaultCloseIssuesViaCommitsInAnyBranch,
-		Status:                          opts.Status,
+		Status:                          repo_model.RepositoryBeingMigrated,
 		IsEmpty:                         !opts.AutoInit,
 	}
 
-	if err := db.WithTx(ctx, func(ctx context.Context) error {
-		isExist, err := gitrepo.IsRepositoryExist(ctx, repo)
+	// 1 - create the repository database operations first
+	err := db.WithTx(ctx, func(ctx context.Context) error {
+		return createRepositoryInDB(ctx, doer, u, repo, false)
+	})
+	if err != nil {
+		return nil, err
+	}
+
+	// last - clean up if something goes wrong
+	// WARNING: Don't override all later err with local variables
+	defer func() {
 		if err != nil {
-			log.Error("Unable to check if %s exists. Error: %v", repo.FullName(), err)
-			return err
-		}
-		if !isExist {
-			return repo_model.ErrRepoNotExist{
-				OwnerName: u.Name,
-				Name:      repo.Name,
+			// we can not use the ctx because it maybe canceled or timeout
+			if errDel := deleteFailedAdoptRepository(repo.ID); errDel != nil {
+				log.Error("Failed to delete repository %s that could not be adopted: %v", repo.FullName(), errDel)
 			}
 		}
+	}()
 
-		if err := CreateRepositoryByExample(ctx, doer, u, repo, true, false); err != nil {
-			return err
-		}
-
-		// Re-fetch the repository from database before updating it (else it would
-		// override changes that were done earlier with sql)
-		if repo, err = repo_model.GetRepositoryByID(ctx, repo.ID); err != nil {
-			return fmt.Errorf("getRepositoryByID: %w", err)
-		}
-		return nil
-	}); err != nil {
-		return nil, err
+	// Re-fetch the repository from database before updating it (else it would
+	// override changes that were done earlier with sql)
+	if repo, err = repo_model.GetRepositoryByID(ctx, repo.ID); err != nil {
+		return nil, fmt.Errorf("getRepositoryByID: %w", err)
 	}
 
-	if err := func() error {
-		if err := adoptRepository(ctx, repo, opts.DefaultBranch); err != nil {
-			return fmt.Errorf("adoptRepository: %w", err)
-		}
-
-		if err := repo_module.CheckDaemonExportOK(ctx, repo); err != nil {
-			return fmt.Errorf("checkDaemonExportOK: %w", err)
-		}
-
-		if stdout, _, err := git.NewCommand("update-server-info").
-			RunStdString(ctx, &git.RunOpts{Dir: repo.RepoPath()}); err != nil {
-			log.Error("CreateRepository(git update-server-info) in %v: Stdout: %s\nError: %v", repo, stdout, err)
-			return fmt.Errorf("CreateRepository(git update-server-info): %w", err)
-		}
-		return nil
-	}(); err != nil {
-		if errDel := DeleteRepository(ctx, doer, repo, false /* no notify */); errDel != nil {
-			log.Error("Failed to delete repository %s that could not be adopted: %v", repo.FullName(), errDel)
-		}
-		return nil, err
+	// 2 - adopt the repository from disk
+	if err = adoptRepository(ctx, repo, opts.DefaultBranch); err != nil {
+		return nil, fmt.Errorf("adoptRepository: %w", err)
 	}
+
+	// 3 - Update the git repository
+	if err = updateGitRepoAfterCreate(ctx, repo); err != nil {
+		return nil, fmt.Errorf("updateGitRepoAfterCreate: %w", err)
+	}
+
+	// 4 - update repository status
+	repo.Status = repo_model.RepositoryReady
+	if err = repo_model.UpdateRepositoryCols(ctx, repo, "status"); err != nil {
+		return nil, fmt.Errorf("UpdateRepositoryCols: %w", err)
+	}
+
 	notify_service.AdoptRepository(ctx, doer, u, repo)
 
 	return repo, nil
diff --git a/services/repository/adopt_test.go b/services/repository/adopt_test.go
index 294185ea1f..6e1dc417b3 100644
--- a/services/repository/adopt_test.go
+++ b/services/repository/adopt_test.go
@@ -14,6 +14,7 @@ import (
 	"code.gitea.io/gitea/models/unittest"
 	user_model "code.gitea.io/gitea/models/user"
 	"code.gitea.io/gitea/modules/setting"
+	"code.gitea.io/gitea/modules/util"
 
 	"github.com/stretchr/testify/assert"
 )
@@ -89,10 +90,36 @@ func TestListUnadoptedRepositories_ListOptions(t *testing.T) {
 
 func TestAdoptRepository(t *testing.T) {
 	assert.NoError(t, unittest.PrepareTestDatabase())
-	assert.NoError(t, unittest.SyncDirs(filepath.Join(setting.RepoRootPath, "user2", "repo1.git"), filepath.Join(setting.RepoRootPath, "user2", "test-adopt.git")))
+
 	user2 := unittest.AssertExistsAndLoadBean(t, &user_model.User{ID: 2})
-	_, err := AdoptRepository(db.DefaultContext, user2, user2, CreateRepoOptions{Name: "test-adopt"})
+
+	// a successful adopt
+	destDir := filepath.Join(setting.RepoRootPath, user2.Name, "test-adopt.git")
+	assert.NoError(t, unittest.SyncDirs(filepath.Join(setting.RepoRootPath, user2.Name, "repo1.git"), destDir))
+
+	adoptedRepo, err := AdoptRepository(db.DefaultContext, user2, user2, CreateRepoOptions{Name: "test-adopt"})
 	assert.NoError(t, err)
 	repoTestAdopt := unittest.AssertExistsAndLoadBean(t, &repo_model.Repository{Name: "test-adopt"})
 	assert.Equal(t, "sha1", repoTestAdopt.ObjectFormatName)
+
+	// just delete the adopted repo's db records
+	err = deleteFailedAdoptRepository(adoptedRepo.ID)
+	assert.NoError(t, err)
+
+	unittest.AssertNotExistsBean(t, &repo_model.Repository{OwnerName: user2.Name, Name: "test-adopt"})
+
+	// a failed adopt because some mock data
+	// remove the hooks directory and create a file so that we cannot create the hooks successfully
+	_ = os.RemoveAll(filepath.Join(destDir, "hooks", "update.d"))
+	assert.NoError(t, os.WriteFile(filepath.Join(destDir, "hooks", "update.d"), []byte("tests"), os.ModePerm))
+
+	adoptedRepo, err = AdoptRepository(db.DefaultContext, user2, user2, CreateRepoOptions{Name: "test-adopt"})
+	assert.Error(t, err)
+	assert.Nil(t, adoptedRepo)
+
+	unittest.AssertNotExistsBean(t, &repo_model.Repository{OwnerName: user2.Name, Name: "test-adopt"})
+
+	exist, err := util.IsExist(repo_model.RepoPath(user2.Name, "test-adopt"))
+	assert.NoError(t, err)
+	assert.True(t, exist) // the repository should be still in the disk
 }
diff --git a/services/repository/create.go b/services/repository/create.go
index af4e897151..22dfce91f0 100644
--- a/services/repository/create.go
+++ b/services/repository/create.go
@@ -17,6 +17,7 @@ import (
 	"code.gitea.io/gitea/models/perm"
 	access_model "code.gitea.io/gitea/models/perm/access"
 	repo_model "code.gitea.io/gitea/models/repo"
+	system_model "code.gitea.io/gitea/models/system"
 	"code.gitea.io/gitea/models/unit"
 	user_model "code.gitea.io/gitea/models/user"
 	"code.gitea.io/gitea/models/webhook"
@@ -140,8 +141,11 @@ func prepareRepoCommit(ctx context.Context, repo *repo_model.Repository, tmpDir
 
 // InitRepository initializes README and .gitignore if needed.
 func initRepository(ctx context.Context, u *user_model.User, repo *repo_model.Repository, opts CreateRepoOptions) (err error) {
-	if err = repo_module.CheckInitRepository(ctx, repo); err != nil {
-		return err
+	// Init git bare new repository.
+	if err = git.InitRepository(ctx, repo.RepoPath(), true, repo.ObjectFormatName); err != nil {
+		return fmt.Errorf("git.InitRepository: %w", err)
+	} else if err = gitrepo.CreateDelegateHooks(ctx, repo); err != nil {
+		return fmt.Errorf("createDelegateHooks: %w", err)
 	}
 
 	// Initialize repository according to user's choice.
@@ -244,100 +248,93 @@ func CreateRepositoryDirectly(ctx context.Context, doer, u *user_model.User, opt
 		ObjectFormatName:                opts.ObjectFormatName,
 	}
 
-	var rollbackRepo *repo_model.Repository
-
-	if err := db.WithTx(ctx, func(ctx context.Context) error {
-		if err := CreateRepositoryByExample(ctx, doer, u, repo, false, false); err != nil {
-			return err
-		}
-
-		// No need for init mirror.
-		if opts.IsMirror {
-			return nil
-		}
-
-		isExist, err := gitrepo.IsRepositoryExist(ctx, repo)
-		if err != nil {
-			log.Error("Unable to check if %s exists. Error: %v", repo.FullName(), err)
-			return err
-		}
-		if isExist {
-			// repo already exists - We have two or three options.
-			// 1. We fail stating that the directory exists
-			// 2. We create the db repository to go with this data and adopt the git repo
-			// 3. We delete it and start afresh
-			//
-			// Previously Gitea would just delete and start afresh - this was naughty.
-			// So we will now fail and delegate to other functionality to adopt or delete
-			log.Error("Files already exist in %s and we are not going to adopt or delete.", repo.FullName())
-			return repo_model.ErrRepoFilesAlreadyExist{
-				Uname: u.Name,
-				Name:  repo.Name,
-			}
-		}
-
-		if err = initRepository(ctx, doer, repo, opts); err != nil {
-			if err2 := gitrepo.DeleteRepository(ctx, repo); err2 != nil {
-				log.Error("initRepository: %v", err)
-				return fmt.Errorf(
-					"delete repo directory %s/%s failed(2): %v", u.Name, repo.Name, err2)
-			}
-			return fmt.Errorf("initRepository: %w", err)
-		}
-
-		// Initialize Issue Labels if selected
-		if len(opts.IssueLabels) > 0 {
-			if err = repo_module.InitializeLabels(ctx, repo.ID, opts.IssueLabels, false); err != nil {
-				rollbackRepo = repo
-				rollbackRepo.OwnerID = u.ID
-				return fmt.Errorf("InitializeLabels: %w", err)
-			}
-		}
-
-		if err := repo_module.CheckDaemonExportOK(ctx, repo); err != nil {
-			return fmt.Errorf("checkDaemonExportOK: %w", err)
-		}
-
-		if stdout, _, err := git.NewCommand("update-server-info").
-			RunStdString(ctx, &git.RunOpts{Dir: repo.RepoPath()}); err != nil {
-			log.Error("CreateRepository(git update-server-info) in %v: Stdout: %s\nError: %v", repo, stdout, err)
-			rollbackRepo = repo
-			rollbackRepo.OwnerID = u.ID
-			return fmt.Errorf("CreateRepository(git update-server-info): %w", err)
-		}
-
-		// update licenses
-		var licenses []string
-		if len(opts.License) > 0 {
-			licenses = append(licenses, opts.License)
-
-			stdout, _, err := git.NewCommand("rev-parse", "HEAD").RunStdString(ctx, &git.RunOpts{Dir: repo.RepoPath()})
-			if err != nil {
-				log.Error("CreateRepository(git rev-parse HEAD) in %v: Stdout: %s\nError: %v", repo, stdout, err)
-				rollbackRepo = repo
-				rollbackRepo.OwnerID = u.ID
-				return fmt.Errorf("CreateRepository(git rev-parse HEAD): %w", err)
-			}
-			if err := repo_model.UpdateRepoLicenses(ctx, repo, stdout, licenses); err != nil {
-				return err
-			}
-		}
-		return nil
-	}); err != nil {
-		if rollbackRepo != nil {
-			if errDelete := DeleteRepositoryDirectly(ctx, doer, rollbackRepo.ID); errDelete != nil {
-				log.Error("Rollback deleteRepository: %v", errDelete)
-			}
-		}
+	needsUpdateStatus := opts.Status != repo_model.RepositoryReady
 
+	// 1 - create the repository database operations first
+	err := db.WithTx(ctx, func(ctx context.Context) error {
+		return createRepositoryInDB(ctx, doer, u, repo, false)
+	})
+	if err != nil {
 		return nil, err
 	}
 
+	// last - clean up if something goes wrong
+	// WARNING: Don't override all later err with local variables
+	defer func() {
+		if err != nil {
+			// we can not use the ctx because it maybe canceled or timeout
+			cleanupRepository(doer, repo.ID)
+		}
+	}()
+
+	// No need for init mirror.
+	if opts.IsMirror {
+		return repo, nil
+	}
+
+	// 2 - check whether the repository with the same storage exists
+	var isExist bool
+	isExist, err = gitrepo.IsRepositoryExist(ctx, repo)
+	if err != nil {
+		log.Error("Unable to check if %s exists. Error: %v", repo.FullName(), err)
+		return nil, err
+	}
+	if isExist {
+		log.Error("Files already exist in %s and we are not going to adopt or delete.", repo.FullName())
+		// Don't return directly, we need err in defer to cleanupRepository
+		err = repo_model.ErrRepoFilesAlreadyExist{
+			Uname: repo.OwnerName,
+			Name:  repo.Name,
+		}
+		return nil, err
+	}
+
+	// 3 - init git repository in storage
+	if err = initRepository(ctx, doer, repo, opts); err != nil {
+		return nil, fmt.Errorf("initRepository: %w", err)
+	}
+
+	// 4 - Initialize Issue Labels if selected
+	if len(opts.IssueLabels) > 0 {
+		if err = repo_module.InitializeLabels(ctx, repo.ID, opts.IssueLabels, false); err != nil {
+			return nil, fmt.Errorf("InitializeLabels: %w", err)
+		}
+	}
+
+	// 5 - Update the git repository
+	if err = updateGitRepoAfterCreate(ctx, repo); err != nil {
+		return nil, fmt.Errorf("updateGitRepoAfterCreate: %w", err)
+	}
+
+	// 6 - update licenses
+	var licenses []string
+	if len(opts.License) > 0 {
+		licenses = append(licenses, opts.License)
+
+		var stdout string
+		stdout, _, err = git.NewCommand("rev-parse", "HEAD").RunStdString(ctx, &git.RunOpts{Dir: repo.RepoPath()})
+		if err != nil {
+			log.Error("CreateRepository(git rev-parse HEAD) in %v: Stdout: %s\nError: %v", repo, stdout, err)
+			return nil, fmt.Errorf("CreateRepository(git rev-parse HEAD): %w", err)
+		}
+		if err = repo_model.UpdateRepoLicenses(ctx, repo, stdout, licenses); err != nil {
+			return nil, err
+		}
+	}
+
+	// 7 - update repository status to be ready
+	if needsUpdateStatus {
+		repo.Status = repo_model.RepositoryReady
+		if err = repo_model.UpdateRepositoryCols(ctx, repo, "status"); err != nil {
+			return nil, fmt.Errorf("UpdateRepositoryCols: %w", err)
+		}
+	}
+
 	return repo, nil
 }
 
-// CreateRepositoryByExample creates a repository for the user/organization.
-func CreateRepositoryByExample(ctx context.Context, doer, u *user_model.User, repo *repo_model.Repository, overwriteOrAdopt, isFork bool) (err error) {
+// createRepositoryInDB creates a repository for the user/organization.
+func createRepositoryInDB(ctx context.Context, doer, u *user_model.User, repo *repo_model.Repository, isFork bool) (err error) {
 	if err = repo_model.IsUsableRepoName(repo.Name); err != nil {
 		return err
 	}
@@ -352,19 +349,6 @@ func CreateRepositoryByExample(ctx context.Context, doer, u *user_model.User, re
 		}
 	}
 
-	isExist, err := gitrepo.IsRepositoryExist(ctx, repo)
-	if err != nil {
-		log.Error("Unable to check if %s exists. Error: %v", repo.FullName(), err)
-		return err
-	}
-	if !overwriteOrAdopt && isExist {
-		log.Error("Files already exist in %s and we are not going to adopt or delete.", repo.FullName())
-		return repo_model.ErrRepoFilesAlreadyExist{
-			Uname: u.Name,
-			Name:  repo.Name,
-		}
-	}
-
 	if err = db.Insert(ctx, repo); err != nil {
 		return err
 	}
@@ -473,3 +457,26 @@ func CreateRepositoryByExample(ctx context.Context, doer, u *user_model.User, re
 
 	return nil
 }
+
+func cleanupRepository(doer *user_model.User, repoID int64) {
+	if errDelete := DeleteRepositoryDirectly(db.DefaultContext, doer, repoID); errDelete != nil {
+		log.Error("cleanupRepository failed: %v", errDelete)
+		// add system notice
+		if err := system_model.CreateRepositoryNotice("DeleteRepositoryDirectly failed when cleanup repository: %v", errDelete); err != nil {
+			log.Error("CreateRepositoryNotice: %v", err)
+		}
+	}
+}
+
+func updateGitRepoAfterCreate(ctx context.Context, repo *repo_model.Repository) error {
+	if err := repo_module.CheckDaemonExportOK(ctx, repo); err != nil {
+		return fmt.Errorf("checkDaemonExportOK: %w", err)
+	}
+
+	if stdout, _, err := git.NewCommand("update-server-info").
+		RunStdString(ctx, &git.RunOpts{Dir: repo.RepoPath()}); err != nil {
+		log.Error("CreateRepository(git update-server-info) in %v: Stdout: %s\nError: %v", repo, stdout, err)
+		return fmt.Errorf("CreateRepository(git update-server-info): %w", err)
+	}
+	return nil
+}
diff --git a/services/repository/create_test.go b/services/repository/create_test.go
new file mode 100644
index 0000000000..9ecf404e8b
--- /dev/null
+++ b/services/repository/create_test.go
@@ -0,0 +1,57 @@
+// Copyright 2025 The Gitea Authors. All rights reserved.
+// SPDX-License-Identifier: MIT
+
+package repository
+
+import (
+	"os"
+	"testing"
+
+	"code.gitea.io/gitea/models/db"
+	repo_model "code.gitea.io/gitea/models/repo"
+	"code.gitea.io/gitea/models/unittest"
+	user_model "code.gitea.io/gitea/models/user"
+	"code.gitea.io/gitea/modules/git"
+	"code.gitea.io/gitea/modules/util"
+
+	"github.com/stretchr/testify/assert"
+)
+
+func TestCreateRepositoryDirectly(t *testing.T) {
+	assert.NoError(t, unittest.PrepareTestDatabase())
+
+	// a successful creating repository
+	user2 := unittest.AssertExistsAndLoadBean(t, &user_model.User{ID: 2})
+
+	createdRepo, err := CreateRepositoryDirectly(git.DefaultContext, user2, user2, CreateRepoOptions{
+		Name: "created-repo",
+	})
+	assert.NoError(t, err)
+	assert.NotNil(t, createdRepo)
+
+	exist, err := util.IsExist(repo_model.RepoPath(user2.Name, createdRepo.Name))
+	assert.NoError(t, err)
+	assert.True(t, exist)
+
+	unittest.AssertExistsAndLoadBean(t, &repo_model.Repository{OwnerName: user2.Name, Name: createdRepo.Name})
+
+	err = DeleteRepositoryDirectly(db.DefaultContext, user2, createdRepo.ID)
+	assert.NoError(t, err)
+
+	// a failed creating because some mock data
+	// create the repository directory so that the creation will fail after database record created.
+	assert.NoError(t, os.MkdirAll(repo_model.RepoPath(user2.Name, createdRepo.Name), os.ModePerm))
+
+	createdRepo2, err := CreateRepositoryDirectly(db.DefaultContext, user2, user2, CreateRepoOptions{
+		Name: "created-repo",
+	})
+	assert.Nil(t, createdRepo2)
+	assert.Error(t, err)
+
+	// assert the cleanup is successful
+	unittest.AssertNotExistsBean(t, &repo_model.Repository{OwnerName: user2.Name, Name: createdRepo.Name})
+
+	exist, err = util.IsExist(repo_model.RepoPath(user2.Name, createdRepo.Name))
+	assert.NoError(t, err)
+	assert.False(t, exist)
+}
diff --git a/services/repository/delete.go b/services/repository/delete.go
index ff74a20817..cf960af8cf 100644
--- a/services/repository/delete.go
+++ b/services/repository/delete.go
@@ -32,6 +32,19 @@ import (
 	"xorm.io/builder"
 )
 
+func deleteDBRepository(ctx context.Context, repoID int64) error {
+	if cnt, err := db.GetEngine(ctx).ID(repoID).Delete(&repo_model.Repository{}); err != nil {
+		return err
+	} else if cnt != 1 {
+		return repo_model.ErrRepoNotExist{
+			ID:        repoID,
+			OwnerName: "",
+			Name:      "",
+		}
+	}
+	return nil
+}
+
 // DeleteRepository deletes a repository for a user or organization.
 // make sure if you call this func to close open sessions (sqlite will otherwise get a deadlock)
 func DeleteRepositoryDirectly(ctx context.Context, doer *user_model.User, repoID int64, ignoreOrgTeams ...bool) error {
@@ -82,14 +95,8 @@ func DeleteRepositoryDirectly(ctx context.Context, doer *user_model.User, repoID
 	}
 	needRewriteKeysFile := deleted > 0
 
-	if cnt, err := sess.ID(repoID).Delete(&repo_model.Repository{}); err != nil {
+	if err := deleteDBRepository(ctx, repoID); err != nil {
 		return err
-	} else if cnt != 1 {
-		return repo_model.ErrRepoNotExist{
-			ID:        repoID,
-			OwnerName: "",
-			Name:      "",
-		}
 	}
 
 	if org != nil && org.IsOrganization() {
diff --git a/services/repository/fork.go b/services/repository/fork.go
index 5b1ba7a418..daf6913510 100644
--- a/services/repository/fork.go
+++ b/services/repository/fork.go
@@ -100,114 +100,106 @@ func ForkRepository(ctx context.Context, doer, owner *user_model.User, opts Fork
 		IsFork:           true,
 		ForkID:           opts.BaseRepo.ID,
 		ObjectFormatName: opts.BaseRepo.ObjectFormatName,
+		Status:           repo_model.RepositoryBeingMigrated,
 	}
 
-	oldRepoPath := opts.BaseRepo.RepoPath()
-
-	needsRollback := false
-	rollbackFn := func() {
-		if !needsRollback {
-			return
-		}
-
-		if exists, _ := gitrepo.IsRepositoryExist(ctx, repo); !exists {
-			return
-		}
-
-		// As the transaction will be failed and hence database changes will be destroyed we only need
-		// to delete the related repository on the filesystem
-		if errDelete := gitrepo.DeleteRepository(ctx, repo); errDelete != nil {
-			log.Error("Failed to remove fork repo")
-		}
-	}
-
-	needsRollbackInPanic := true
-	defer func() {
-		panicErr := recover()
-		if panicErr == nil {
-			return
-		}
-
-		if needsRollbackInPanic {
-			rollbackFn()
-		}
-		panic(panicErr)
-	}()
-
-	err = db.WithTx(ctx, func(txCtx context.Context) error {
-		if err = CreateRepositoryByExample(txCtx, doer, owner, repo, false, true); err != nil {
+	// 1 - Create the repository in the database
+	err = db.WithTx(ctx, func(ctx context.Context) error {
+		if err = createRepositoryInDB(ctx, doer, owner, repo, true); err != nil {
 			return err
 		}
-
-		if err = repo_model.IncrementRepoForkNum(txCtx, opts.BaseRepo.ID); err != nil {
+		if err = repo_model.IncrementRepoForkNum(ctx, opts.BaseRepo.ID); err != nil {
 			return err
 		}
 
 		// copy lfs files failure should not be ignored
-		if err = git_model.CopyLFS(txCtx, repo, opts.BaseRepo); err != nil {
-			return err
-		}
-
-		needsRollback = true
-
-		cloneCmd := git.NewCommand("clone", "--bare")
-		if opts.SingleBranch != "" {
-			cloneCmd.AddArguments("--single-branch", "--branch").AddDynamicArguments(opts.SingleBranch)
-		}
-		if stdout, _, err := cloneCmd.AddDynamicArguments(oldRepoPath, repo.RepoPath()).
-			RunStdBytes(txCtx, &git.RunOpts{Timeout: 10 * time.Minute}); err != nil {
-			log.Error("Fork Repository (git clone) Failed for %v (from %v):\nStdout: %s\nError: %v", repo, opts.BaseRepo, stdout, err)
-			return fmt.Errorf("git clone: %w", err)
-		}
-
-		if err := repo_module.CheckDaemonExportOK(txCtx, repo); err != nil {
-			return fmt.Errorf("checkDaemonExportOK: %w", err)
-		}
-
-		if stdout, _, err := git.NewCommand("update-server-info").
-			RunStdString(txCtx, &git.RunOpts{Dir: repo.RepoPath()}); err != nil {
-			log.Error("Fork Repository (git update-server-info) failed for %v:\nStdout: %s\nError: %v", repo, stdout, err)
-			return fmt.Errorf("git update-server-info: %w", err)
-		}
-
-		if err = gitrepo.CreateDelegateHooks(ctx, repo); err != nil {
-			return fmt.Errorf("createDelegateHooks: %w", err)
-		}
-
-		gitRepo, err := gitrepo.OpenRepository(txCtx, repo)
-		if err != nil {
-			return fmt.Errorf("OpenRepository: %w", err)
-		}
-		defer gitRepo.Close()
-
-		_, err = repo_module.SyncRepoBranchesWithRepo(txCtx, repo, gitRepo, doer.ID)
-		return err
+		return git_model.CopyLFS(ctx, repo, opts.BaseRepo)
 	})
-	needsRollbackInPanic = false
 	if err != nil {
-		rollbackFn()
 		return nil, err
 	}
 
-	// even if below operations failed, it could be ignored. And they will be retried
-	if err := repo_module.UpdateRepoSize(ctx, repo); err != nil {
-		log.Error("Failed to update size for repository: %v", err)
-	}
-	if err := repo_model.CopyLanguageStat(ctx, opts.BaseRepo, repo); err != nil {
-		log.Error("Copy language stat from oldRepo failed: %v", err)
-	}
-	if err := repo_model.CopyLicense(ctx, opts.BaseRepo, repo); err != nil {
-		return nil, err
-	}
-
-	gitRepo, err := gitrepo.OpenRepository(ctx, repo)
-	if err != nil {
-		log.Error("Open created git repository failed: %v", err)
-	} else {
-		defer gitRepo.Close()
-		if err := repo_module.SyncReleasesWithTags(ctx, repo, gitRepo); err != nil {
-			log.Error("Sync releases from git tags failed: %v", err)
+	// last - clean up if something goes wrong
+	// WARNING: Don't override all later err with local variables
+	defer func() {
+		if err != nil {
+			// we can not use the ctx because it maybe canceled or timeout
+			cleanupRepository(doer, repo.ID)
 		}
+	}()
+
+	// 2 - check whether the repository with the same storage exists
+	var isExist bool
+	isExist, err = gitrepo.IsRepositoryExist(ctx, repo)
+	if err != nil {
+		log.Error("Unable to check if %s exists. Error: %v", repo.FullName(), err)
+		return nil, err
+	}
+	if isExist {
+		log.Error("Files already exist in %s and we are not going to adopt or delete.", repo.FullName())
+		// Don't return directly, we need err in defer to cleanupRepository
+		err = repo_model.ErrRepoFilesAlreadyExist{
+			Uname: repo.OwnerName,
+			Name:  repo.Name,
+		}
+		return nil, err
+	}
+
+	// 3 - Clone the repository
+	cloneCmd := git.NewCommand("clone", "--bare")
+	if opts.SingleBranch != "" {
+		cloneCmd.AddArguments("--single-branch", "--branch").AddDynamicArguments(opts.SingleBranch)
+	}
+	var stdout []byte
+	if stdout, _, err = cloneCmd.AddDynamicArguments(opts.BaseRepo.RepoPath(), repo.RepoPath()).
+		RunStdBytes(ctx, &git.RunOpts{Timeout: 10 * time.Minute}); err != nil {
+		log.Error("Fork Repository (git clone) Failed for %v (from %v):\nStdout: %s\nError: %v", repo, opts.BaseRepo, stdout, err)
+		return nil, fmt.Errorf("git clone: %w", err)
+	}
+
+	// 4 - Update the git repository
+	if err = updateGitRepoAfterCreate(ctx, repo); err != nil {
+		return nil, fmt.Errorf("updateGitRepoAfterCreate: %w", err)
+	}
+
+	// 5 - Create hooks
+	if err = gitrepo.CreateDelegateHooks(ctx, repo); err != nil {
+		return nil, fmt.Errorf("createDelegateHooks: %w", err)
+	}
+
+	// 6 - Sync the repository branches and tags
+	var gitRepo *git.Repository
+	gitRepo, err = gitrepo.OpenRepository(ctx, repo)
+	if err != nil {
+		return nil, fmt.Errorf("OpenRepository: %w", err)
+	}
+	defer gitRepo.Close()
+
+	if _, err = repo_module.SyncRepoBranchesWithRepo(ctx, repo, gitRepo, doer.ID); err != nil {
+		return nil, fmt.Errorf("SyncRepoBranchesWithRepo: %w", err)
+	}
+	if err = repo_module.SyncReleasesWithTags(ctx, repo, gitRepo); err != nil {
+		return nil, fmt.Errorf("Sync releases from git tags failed: %v", err)
+	}
+
+	// 7 - Update the repository
+	// even if below operations failed, it could be ignored. And they will be retried
+	if err = repo_module.UpdateRepoSize(ctx, repo); err != nil {
+		log.Error("Failed to update size for repository: %v", err)
+		err = nil
+	}
+	if err = repo_model.CopyLanguageStat(ctx, opts.BaseRepo, repo); err != nil {
+		log.Error("Copy language stat from oldRepo failed: %v", err)
+		err = nil
+	}
+	if err = repo_model.CopyLicense(ctx, opts.BaseRepo, repo); err != nil {
+		return nil, err
+	}
+
+	// 8 - update repository status to be ready
+	repo.Status = repo_model.RepositoryReady
+	if err = repo_model.UpdateRepositoryCols(ctx, repo, "status"); err != nil {
+		return nil, fmt.Errorf("UpdateRepositoryCols: %w", err)
 	}
 
 	notify_service.ForkRepository(ctx, doer, opts.BaseRepo, repo)
diff --git a/services/repository/fork_test.go b/services/repository/fork_test.go
index 452798b25b..9edc0aa39f 100644
--- a/services/repository/fork_test.go
+++ b/services/repository/fork_test.go
@@ -4,13 +4,16 @@
 package repository
 
 import (
+	"os"
 	"testing"
 
+	"code.gitea.io/gitea/models/db"
 	repo_model "code.gitea.io/gitea/models/repo"
 	"code.gitea.io/gitea/models/unittest"
 	user_model "code.gitea.io/gitea/models/user"
 	"code.gitea.io/gitea/modules/git"
 	"code.gitea.io/gitea/modules/setting"
+	"code.gitea.io/gitea/modules/util"
 
 	"github.com/stretchr/testify/assert"
 )
@@ -46,3 +49,43 @@ func TestForkRepository(t *testing.T) {
 	assert.Nil(t, fork2)
 	assert.True(t, repo_model.IsErrReachLimitOfRepo(err))
 }
+
+func TestForkRepositoryCleanup(t *testing.T) {
+	assert.NoError(t, unittest.PrepareTestDatabase())
+
+	// a successful fork
+	user2 := unittest.AssertExistsAndLoadBean(t, &user_model.User{ID: 2})
+	repo10 := unittest.AssertExistsAndLoadBean(t, &repo_model.Repository{ID: 10})
+
+	fork, err := ForkRepository(git.DefaultContext, user2, user2, ForkRepoOptions{
+		BaseRepo: repo10,
+		Name:     "test",
+	})
+	assert.NoError(t, err)
+	assert.NotNil(t, fork)
+
+	exist, err := util.IsExist(repo_model.RepoPath(user2.Name, "test"))
+	assert.NoError(t, err)
+	assert.True(t, exist)
+
+	err = DeleteRepositoryDirectly(db.DefaultContext, user2, fork.ID)
+	assert.NoError(t, err)
+
+	// a failed creating because some mock data
+	// create the repository directory so that the creation will fail after database record created.
+	assert.NoError(t, os.MkdirAll(repo_model.RepoPath(user2.Name, "test"), os.ModePerm))
+
+	fork2, err := ForkRepository(db.DefaultContext, user2, user2, ForkRepoOptions{
+		BaseRepo: repo10,
+		Name:     "test",
+	})
+	assert.Nil(t, fork2)
+	assert.Error(t, err)
+
+	// assert the cleanup is successful
+	unittest.AssertNotExistsBean(t, &repo_model.Repository{OwnerName: user2.Name, Name: "test"})
+
+	exist, err = util.IsExist(repo_model.RepoPath(user2.Name, "test"))
+	assert.NoError(t, err)
+	assert.False(t, exist)
+}
diff --git a/services/repository/generate.go b/services/repository/generate.go
index 9d2bbb1f7f..1c4d3b7b63 100644
--- a/services/repository/generate.go
+++ b/services/repository/generate.go
@@ -17,7 +17,6 @@ import (
 
 	git_model "code.gitea.io/gitea/models/git"
 	repo_model "code.gitea.io/gitea/models/repo"
-	user_model "code.gitea.io/gitea/models/user"
 	"code.gitea.io/gitea/modules/git"
 	"code.gitea.io/gitea/modules/gitrepo"
 	"code.gitea.io/gitea/modules/log"
@@ -328,57 +327,6 @@ func (gro GenerateRepoOptions) IsValid() bool {
 		gro.IssueLabels || gro.ProtectedBranch // or other items as they are added
 }
 
-// generateRepository generates a repository from a template
-func generateRepository(ctx context.Context, doer, owner *user_model.User, templateRepo *repo_model.Repository, opts GenerateRepoOptions) (_ *repo_model.Repository, err error) {
-	generateRepo := &repo_model.Repository{
-		OwnerID:          owner.ID,
-		Owner:            owner,
-		OwnerName:        owner.Name,
-		Name:             opts.Name,
-		LowerName:        strings.ToLower(opts.Name),
-		Description:      opts.Description,
-		DefaultBranch:    opts.DefaultBranch,
-		IsPrivate:        opts.Private,
-		IsEmpty:          !opts.GitContent || templateRepo.IsEmpty,
-		IsFsckEnabled:    templateRepo.IsFsckEnabled,
-		TemplateID:       templateRepo.ID,
-		TrustModel:       templateRepo.TrustModel,
-		ObjectFormatName: templateRepo.ObjectFormatName,
-	}
-
-	if err = CreateRepositoryByExample(ctx, doer, owner, generateRepo, false, false); err != nil {
-		return nil, err
-	}
-
-	isExist, err := gitrepo.IsRepositoryExist(ctx, generateRepo)
-	if err != nil {
-		log.Error("Unable to check if %s exists. Error: %v", generateRepo.FullName(), err)
-		return nil, err
-	}
-	if isExist {
-		return nil, repo_model.ErrRepoFilesAlreadyExist{
-			Uname: generateRepo.OwnerName,
-			Name:  generateRepo.Name,
-		}
-	}
-
-	if err = repo_module.CheckInitRepository(ctx, generateRepo); err != nil {
-		return generateRepo, err
-	}
-
-	if err = repo_module.CheckDaemonExportOK(ctx, generateRepo); err != nil {
-		return generateRepo, fmt.Errorf("checkDaemonExportOK: %w", err)
-	}
-
-	if stdout, _, err := git.NewCommand("update-server-info").
-		RunStdString(ctx, &git.RunOpts{Dir: generateRepo.RepoPath()}); err != nil {
-		log.Error("GenerateRepository(git update-server-info) in %v: Stdout: %s\nError: %v", generateRepo, stdout, err)
-		return generateRepo, fmt.Errorf("error in GenerateRepository(git update-server-info): %w", err)
-	}
-
-	return generateRepo, nil
-}
-
 var fileNameSanitizeRegexp = regexp.MustCompile(`(?i)\.\.|[<>:\"/\\|?*\x{0000}-\x{001F}]|^(con|prn|aux|nul|com\d|lpt\d)$`)
 
 // Sanitize user input to valid OS filenames
diff --git a/services/repository/migrate.go b/services/repository/migrate.go
index 2a17e9acd9..003be1a9ab 100644
--- a/services/repository/migrate.go
+++ b/services/repository/migrate.go
@@ -118,14 +118,8 @@ func MigrateRepositoryGitData(ctx context.Context, u *user_model.User,
 		repo.Owner = u
 	}
 
-	if err := repo_module.CheckDaemonExportOK(ctx, repo); err != nil {
-		return repo, fmt.Errorf("checkDaemonExportOK: %w", err)
-	}
-
-	if stdout, _, err := git.NewCommand("update-server-info").
-		RunStdString(ctx, &git.RunOpts{Dir: repoPath}); err != nil {
-		log.Error("MigrateRepositoryGitData(git update-server-info) in %v: Stdout: %s\nError: %v", repo, stdout, err)
-		return repo, fmt.Errorf("error in MigrateRepositoryGitData(git update-server-info): %w", err)
+	if err := updateGitRepoAfterCreate(ctx, repo); err != nil {
+		return nil, fmt.Errorf("updateGitRepoAfterCreate: %w", err)
 	}
 
 	gitRepo, err := git.OpenRepository(ctx, repoPath)
diff --git a/services/repository/template.go b/services/repository/template.go
index 36a680c8e2..b3f34e4858 100644
--- a/services/repository/template.go
+++ b/services/repository/template.go
@@ -5,12 +5,17 @@ package repository
 
 import (
 	"context"
+	"fmt"
+	"strings"
 
 	"code.gitea.io/gitea/models/db"
 	git_model "code.gitea.io/gitea/models/git"
 	issues_model "code.gitea.io/gitea/models/issues"
 	repo_model "code.gitea.io/gitea/models/repo"
 	user_model "code.gitea.io/gitea/models/user"
+	"code.gitea.io/gitea/modules/git"
+	"code.gitea.io/gitea/modules/gitrepo"
+	"code.gitea.io/gitea/modules/log"
 	notify_service "code.gitea.io/gitea/services/notify"
 )
 
@@ -69,66 +74,120 @@ func GenerateRepository(ctx context.Context, doer, owner *user_model.User, templ
 		}
 	}
 
-	var generateRepo *repo_model.Repository
-	if err = db.WithTx(ctx, func(ctx context.Context) error {
-		generateRepo, err = generateRepository(ctx, doer, owner, templateRepo, opts)
-		if err != nil {
-			return err
-		}
+	generateRepo := &repo_model.Repository{
+		OwnerID:          owner.ID,
+		Owner:            owner,
+		OwnerName:        owner.Name,
+		Name:             opts.Name,
+		LowerName:        strings.ToLower(opts.Name),
+		Description:      opts.Description,
+		DefaultBranch:    opts.DefaultBranch,
+		IsPrivate:        opts.Private,
+		IsEmpty:          !opts.GitContent || templateRepo.IsEmpty,
+		IsFsckEnabled:    templateRepo.IsFsckEnabled,
+		TemplateID:       templateRepo.ID,
+		TrustModel:       templateRepo.TrustModel,
+		ObjectFormatName: templateRepo.ObjectFormatName,
+		Status:           repo_model.RepositoryBeingMigrated,
+	}
 
-		// Git Content
-		if opts.GitContent && !templateRepo.IsEmpty {
-			if err = GenerateGitContent(ctx, templateRepo, generateRepo); err != nil {
-				return err
-			}
-		}
-
-		// Topics
-		if opts.Topics {
-			if err = repo_model.GenerateTopics(ctx, templateRepo, generateRepo); err != nil {
-				return err
-			}
-		}
-
-		// Git Hooks
-		if opts.GitHooks {
-			if err = GenerateGitHooks(ctx, templateRepo, generateRepo); err != nil {
-				return err
-			}
-		}
-
-		// Webhooks
-		if opts.Webhooks {
-			if err = GenerateWebhooks(ctx, templateRepo, generateRepo); err != nil {
-				return err
-			}
-		}
-
-		// Avatar
-		if opts.Avatar && len(templateRepo.Avatar) > 0 {
-			if err = generateAvatar(ctx, templateRepo, generateRepo); err != nil {
-				return err
-			}
-		}
-
-		// Issue Labels
-		if opts.IssueLabels {
-			if err = GenerateIssueLabels(ctx, templateRepo, generateRepo); err != nil {
-				return err
-			}
-		}
-
-		if opts.ProtectedBranch {
-			if err = GenerateProtectedBranch(ctx, templateRepo, generateRepo); err != nil {
-				return err
-			}
-		}
-
-		return nil
+	// 1 - Create the repository in the database
+	if err := db.WithTx(ctx, func(ctx context.Context) error {
+		return createRepositoryInDB(ctx, doer, owner, generateRepo, false)
 	}); err != nil {
 		return nil, err
 	}
 
+	// last - clean up the repository if something goes wrong
+	defer func() {
+		if err != nil {
+			// we can not use the ctx because it maybe canceled or timeout
+			cleanupRepository(doer, generateRepo.ID)
+		}
+	}()
+
+	// 2 - check whether the repository with the same storage exists
+	isExist, err := gitrepo.IsRepositoryExist(ctx, generateRepo)
+	if err != nil {
+		log.Error("Unable to check if %s exists. Error: %v", generateRepo.FullName(), err)
+		return nil, err
+	}
+	if isExist {
+		// Don't return directly, we need err in defer to cleanupRepository
+		err = repo_model.ErrRepoFilesAlreadyExist{
+			Uname: generateRepo.OwnerName,
+			Name:  generateRepo.Name,
+		}
+		return nil, err
+	}
+
+	// 3 -Init git bare new repository.
+	if err = git.InitRepository(ctx, generateRepo.RepoPath(), true, generateRepo.ObjectFormatName); err != nil {
+		return nil, fmt.Errorf("git.InitRepository: %w", err)
+	} else if err = gitrepo.CreateDelegateHooks(ctx, generateRepo); err != nil {
+		return nil, fmt.Errorf("createDelegateHooks: %w", err)
+	}
+
+	// 4 - Update the git repository
+	if err = updateGitRepoAfterCreate(ctx, generateRepo); err != nil {
+		return nil, fmt.Errorf("updateGitRepoAfterCreate: %w", err)
+	}
+
+	// 5 - generate the repository contents according to the template
+	// Git Content
+	if opts.GitContent && !templateRepo.IsEmpty {
+		if err = GenerateGitContent(ctx, templateRepo, generateRepo); err != nil {
+			return nil, err
+		}
+	}
+
+	// Topics
+	if opts.Topics {
+		if err = repo_model.GenerateTopics(ctx, templateRepo, generateRepo); err != nil {
+			return nil, err
+		}
+	}
+
+	// Git Hooks
+	if opts.GitHooks {
+		if err = GenerateGitHooks(ctx, templateRepo, generateRepo); err != nil {
+			return nil, err
+		}
+	}
+
+	// Webhooks
+	if opts.Webhooks {
+		if err = GenerateWebhooks(ctx, templateRepo, generateRepo); err != nil {
+			return nil, err
+		}
+	}
+
+	// Avatar
+	if opts.Avatar && len(templateRepo.Avatar) > 0 {
+		if err = generateAvatar(ctx, templateRepo, generateRepo); err != nil {
+			return nil, err
+		}
+	}
+
+	// Issue Labels
+	if opts.IssueLabels {
+		if err = GenerateIssueLabels(ctx, templateRepo, generateRepo); err != nil {
+			return nil, err
+		}
+	}
+
+	if opts.ProtectedBranch {
+		if err = GenerateProtectedBranch(ctx, templateRepo, generateRepo); err != nil {
+			return nil, err
+		}
+	}
+
+	// 6 - update repository status to be ready
+	generateRepo.Status = repo_model.RepositoryReady
+	if err = repo_model.UpdateRepositoryCols(ctx, generateRepo, "status"); err != nil {
+		return nil, fmt.Errorf("UpdateRepositoryCols: %w", err)
+	}
+
 	notify_service.CreateRepository(ctx, doer, owner, generateRepo)
 
 	return generateRepo, nil
diff --git a/tests/integration/repo_test.go b/tests/integration/repo_test.go
index da5aaf3da0..c04d09af08 100644
--- a/tests/integration/repo_test.go
+++ b/tests/integration/repo_test.go
@@ -6,15 +6,23 @@ package integration
 import (
 	"fmt"
 	"net/http"
+	"os"
 	"path"
 	"strconv"
 	"strings"
 	"testing"
 	"time"
 
+	"code.gitea.io/gitea/models/db"
+	repo_model "code.gitea.io/gitea/models/repo"
 	"code.gitea.io/gitea/models/unit"
+	"code.gitea.io/gitea/models/unittest"
+	user_model "code.gitea.io/gitea/models/user"
+	"code.gitea.io/gitea/modules/git"
 	"code.gitea.io/gitea/modules/setting"
 	"code.gitea.io/gitea/modules/test"
+	"code.gitea.io/gitea/modules/util"
+	repo_service "code.gitea.io/gitea/services/repository"
 	"code.gitea.io/gitea/tests"
 
 	"github.com/PuerkitoBio/goquery"
@@ -493,3 +501,46 @@ func testViewCommit(t *testing.T) {
 	resp := MakeRequest(t, req, http.StatusNotFound)
 	assert.True(t, test.IsNormalPageCompleted(resp.Body.String()), "non-existing commit should render 404 page")
 }
+
+// TestGenerateRepository the test cannot succeed when moved as a unit test
+func TestGenerateRepository(t *testing.T) {
+	defer tests.PrepareTestEnv(t)()
+
+	// a successful generate from template
+	user2 := unittest.AssertExistsAndLoadBean(t, &user_model.User{ID: 2})
+	repo44 := unittest.AssertExistsAndLoadBean(t, &repo_model.Repository{ID: 44})
+
+	generatedRepo, err := repo_service.GenerateRepository(git.DefaultContext, user2, user2, repo44, repo_service.GenerateRepoOptions{
+		Name:       "generated-from-template-44",
+		GitContent: true,
+	})
+	assert.NoError(t, err)
+	assert.NotNil(t, generatedRepo)
+
+	exist, err := util.IsExist(repo_model.RepoPath(user2.Name, generatedRepo.Name))
+	assert.NoError(t, err)
+	assert.True(t, exist)
+
+	unittest.AssertExistsAndLoadBean(t, &repo_model.Repository{OwnerName: user2.Name, Name: generatedRepo.Name})
+
+	err = repo_service.DeleteRepositoryDirectly(db.DefaultContext, user2, generatedRepo.ID)
+	assert.NoError(t, err)
+
+	// a failed creating because some mock data
+	// create the repository directory so that the creation will fail after database record created.
+	assert.NoError(t, os.MkdirAll(repo_model.RepoPath(user2.Name, "generated-from-template-44"), os.ModePerm))
+
+	generatedRepo2, err := repo_service.GenerateRepository(db.DefaultContext, user2, user2, repo44, repo_service.GenerateRepoOptions{
+		Name:       "generated-from-template-44",
+		GitContent: true,
+	})
+	assert.Nil(t, generatedRepo2)
+	assert.Error(t, err)
+
+	// assert the cleanup is successful
+	unittest.AssertNotExistsBean(t, &repo_model.Repository{OwnerName: user2.Name, Name: generatedRepo.Name})
+
+	exist, err = util.IsExist(repo_model.RepoPath(user2.Name, generatedRepo.Name))
+	assert.NoError(t, err)
+	assert.False(t, exist)
+}