diff --git a/packages/standard-server-fetch/src/event-iterator.test.ts b/packages/standard-server-fetch/src/event-iterator.test.ts
index 3982ea0ce..94ba5f3fc 100644
--- a/packages/standard-server-fetch/src/event-iterator.test.ts
+++ b/packages/standard-server-fetch/src/event-iterator.test.ts
@@ -180,6 +180,30 @@ describe('toEventIterator', () => {
     expect(runInSpanContextSpy).toHaveBeenCalledTimes(2)
   })
 
+  it('should throw if .return() while waiting for .next()', async () => {
+    const stream = new ReadableStream<string>({
+      async pull(controller) {
+        await new Promise(resolve => setTimeout(resolve, 25))
+        controller.enqueue('event: message\ndata: {"order": 1}\nid: id-1\nretry: 10000\n\n')
+        controller.close()
+      },
+    }).pipeThrough(new TextEncoderStream())
+
+    const generator = toEventIterator(stream)
+    expect(generator).toSatisfy(isAsyncIteratorObject)
+
+    const promise = expect(generator.next()).rejects.toBeInstanceOf(shared.AbortError)
+
+    await new Promise(resolve => setTimeout(resolve, 0))
+    await generator.return(undefined)
+    await promise
+
+    await vi.waitFor(() => expect(stream.getReader().closed).resolves.toBe(undefined))
+
+    expect(startSpanSpy).toHaveBeenCalledTimes(1)
+    expect(runInSpanContextSpy).toHaveBeenCalledTimes(2)
+  })
+
   it('error while reading', async () => {
     const stream = new ReadableStream<string>({
       async pull(controller) {
diff --git a/packages/standard-server-fetch/src/event-iterator.ts b/packages/standard-server-fetch/src/event-iterator.ts
index 1c9d1dbd4..d9194989d 100644
--- a/packages/standard-server-fetch/src/event-iterator.ts
+++ b/packages/standard-server-fetch/src/event-iterator.ts
@@ -1,5 +1,5 @@
 import type { SetSpanErrorOptions } from '@orpc/shared'
-import { AsyncIteratorClass, isTypescriptObject, parseEmptyableJSON, runInSpanContext, setSpanError, startSpan, stringifyJSON } from '@orpc/shared'
+import { AbortError, AsyncIteratorClass, isTypescriptObject, parseEmptyableJSON, runInSpanContext, setSpanError, startSpan, stringifyJSON } from '@orpc/shared'
 import { encodeEventMessage, ErrorEvent, EventDecoderStream, getEventMeta, withEventMeta } from '@orpc/standard-server'
 
 export interface ToEventIteratorOptions extends SetSpanErrorOptions {}
@@ -14,6 +14,7 @@ export function toEventIterator(
 
   const reader = eventStream?.getReader()
   let span: ReturnType<typeof startSpan> | undefined
+  let isCancelled = false
 
   return new AsyncIteratorClass(async () => {
     span ??= startSpan('consume_event_iterator_stream')
@@ -26,7 +27,23 @@ export function toEventIterator(
 
         const { done, value } = await runInSpanContext(span, () => reader.read())
 
+        /**
+         * Handle stream completion scenarios:
+         *
+         * 1. If the reader is cancelled while waiting for the next value,
+         *    reader.read() will resolve as { done: true, value: undefined }.
+         *    However, this behavior is unreliable and we should only resolve
+         *    a value when the sender explicitly indicates completion.
+         *
+         * 2. The only implicit behavior we allow is when the sender successfully
+         *    closes the stream without sending a 'done' event - in this case,
+         *    we resolve with { done: true, value: undefined }.
+         */
         if (done) {
+          if (isCancelled) {
+            throw new AbortError('Stream was cancelled')
+          }
+
           return { done: true, value: undefined }
         }
 
@@ -82,6 +99,7 @@ export function toEventIterator(
   }, async (reason) => {
     try {
       if (reason !== 'next') {
+        isCancelled = true
         span?.addEvent('cancelled')
       }