diff --git a/controller/tests/contract_self_spend_cancel.rs b/controller/tests/contract_self_spend_cancel.rs
new file mode 100644
index 00000000..dc242dae
--- /dev/null
+++ b/controller/tests/contract_self_spend_cancel.rs
@@ -0,0 +1,93 @@
+// Copyright 2022 The Grin Developers
+// Licensed under the Apache License, Version 2.0 (the "License");
+// you may not use this file except in compliance with the License.
+// You may obtain a copy of the License at
+//
+//     http://www.apache.org/licenses/LICENSE-2.0
+//
+// Unless required by applicable law or agreed to in writing, software
+// distributed under the License is distributed on an "AS IS" BASIS,
+// WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+// See the License for the specific language governing permissions and
+// limitations under the License.
+
+//! Test a wallet doing contract self-spend flow
+// #[macro_use]
+extern crate grin_wallet_controller as wallet;
+extern crate grin_wallet_impls as impls;
+extern crate log;
+
+use grin_wallet_libwallet as libwallet;
+
+use impls::test_framework::{self};
+use libwallet::contract::my_fee_contribution;
+use libwallet::contract::types::{ContractNewArgsAPI, ContractSetupArgsAPI};
+use libwallet::{Slate, SlateState, TxLogEntryType};
+use std::sync::atomic::Ordering;
+use std::thread;
+use std::time::Duration;
+
+#[macro_use]
+mod common;
+use common::{clean_output_dir, create_wallets, setup};
+
+/// contract self-spend flow
+fn contract_self_spend_cancel_impl(test_dir: &'static str) -> Result<(), libwallet::Error> {
+	// create a single wallet and mine 4 blocks
+	let (wallets, chain, stopper, mut bh) =
+		create_wallets(vec![vec![("default", 4)]], test_dir).unwrap();
+	let send_wallet = wallets[0].0.clone();
+	let send_mask = wallets[0].1.as_ref();
+
+	let mut slate = Slate::blank(0, true); // this gets overriden below
+
+	wallet::controller::owner_single_use(Some(send_wallet.clone()), send_mask, None, |api, m| {
+		// Send wallet initiates a standard transaction with --send=0
+		let args = &ContractNewArgsAPI {
+			setup_args: ContractSetupArgsAPI {
+				net_change: Some(0),
+				num_participants: 1,
+				..Default::default()
+			},
+			..Default::default()
+		};
+		slate = api.contract_new(m, args)?;
+		Ok(())
+	})?;
+	assert_eq!(slate.state, SlateState::Standard1);
+
+	// Send wallet finalizes and posts
+	wallet::controller::owner_single_use(Some(send_wallet.clone()), send_mask, None, |api, m| {
+		api.cancel_tx(m, None, Some(slate.id))?;
+		Ok(())
+	})?;
+
+	// Assert tx log has been cancelled
+	wallet::controller::owner_single_use(Some(send_wallet.clone()), send_mask, None, |api, m| {
+		let query_args = libwallet::RetrieveTxQueryArgs {
+			exclude_cancelled: Some(false),
+			..Default::default()
+		};
+		let (refreshed, txs) = api.retrieve_txs(m, true, None, None, Some(query_args))?;
+		assert!(refreshed);
+		assert_eq!(txs.len() as u64, 5); // send wallet didn't mine 4 blocks and made 1 tx
+		let tx_log = txs[4].clone(); // TODO: why -5 and not -4?
+		assert_eq!(tx_log.tx_type, TxLogEntryType::TxSelfSpendCancelled);
+		Ok(())
+	})?;
+
+	// let logging finish
+	stopper.store(false, Ordering::Relaxed);
+	thread::sleep(Duration::from_millis(200));
+
+	Ok(())
+}
+
+#[test]
+fn wallet_contract_self_spend_cancel() -> Result<(), libwallet::Error> {
+	let test_dir = "test_output/contract_self_spend_cancel";
+	setup(test_dir);
+	contract_self_spend_cancel_impl(test_dir)?;
+	clean_output_dir(test_dir);
+	Ok(())
+}
diff --git a/libwallet/src/internal/tx.rs b/libwallet/src/internal/tx.rs
index b1d3a987..230e8e0c 100644
--- a/libwallet/src/internal/tx.rs
+++ b/libwallet/src/internal/tx.rs
@@ -363,8 +363,12 @@ where
 		return Err(Error::TransactionDoesntExist(tx_id_string));
 	}
 	let tx = tx_vec[0].clone();
+	debug!("cancel_tx: tx: {}", tx.tx_type);
 	match tx.tx_type {
-		TxLogEntryType::TxSent | TxLogEntryType::TxReceived | TxLogEntryType::TxReverted => {}
+		TxLogEntryType::TxSent
+		| TxLogEntryType::TxReceived
+		| TxLogEntryType::TxReverted
+		| TxLogEntryType::TxSelfSpend => {}
 		_ => return Err(Error::TransactionNotCancellable(tx_id_string)),
 	}
 	if tx.confirmed {
diff --git a/libwallet/src/internal/updater.rs b/libwallet/src/internal/updater.rs
index 08f4271d..3d5db436 100644
--- a/libwallet/src/internal/updater.rs
+++ b/libwallet/src/internal/updater.rs
@@ -112,6 +112,7 @@ where
 					if v {
 						tx_entry.tx_type != TxLogEntryType::TxReceivedCancelled
 							&& tx_entry.tx_type != TxLogEntryType::TxSentCancelled
+							&& tx_entry.tx_type != TxLogEntryType::TxSelfSpendCancelled
 					} else {
 						true
 					}
@@ -491,6 +492,7 @@ where
 		TxLogEntryType::TxReceived | TxLogEntryType::TxReverted => {
 			tx.tx_type = TxLogEntryType::TxReceivedCancelled
 		}
+		TxLogEntryType::TxSelfSpend => tx.tx_type = TxLogEntryType::TxSelfSpendCancelled,
 		_ => {}
 	}
 	batch.save_tx_log_entry(tx, parent_key_id)?;