diff --git a/libs/arcade-mcp-server/arcade_mcp_server/managers/prompt.py b/libs/arcade-mcp-server/arcade_mcp_server/managers/prompt.py
index b0c6d0241..7dc6bb32c 100644
--- a/libs/arcade-mcp-server/arcade_mcp_server/managers/prompt.py
+++ b/libs/arcade-mcp-server/arcade_mcp_server/managers/prompt.py
@@ -111,9 +111,13 @@ async def update_prompt(
         prompt: Prompt,
         handler: Callable[[dict[str, str]], list[PromptMessage]] | None = None,
     ) -> Prompt:
-        # Ensure exists
+        # Remove the existing entry (this also verifies it exists). Removing by the
+        # original ``name`` rather than just upserting by ``prompt.name`` ensures a
+        # rename (prompt.name != name) does not leave the old entry orphaned in the
+        # registry. Mirrors ResourceManager.update_resource, which handles URI
+        # changes the same way.
         try:
-            _ = await self.registry.get(name)
+            await self.registry.remove(name)
         except KeyError:
             raise NotFoundError(f"Prompt '{name}' not found")
 
diff --git a/libs/tests/arcade_mcp_server/test_prompt.py b/libs/tests/arcade_mcp_server/test_prompt.py
index cf2f69814..0158cafa6 100644
--- a/libs/tests/arcade_mcp_server/test_prompt.py
+++ b/libs/tests/arcade_mcp_server/test_prompt.py
@@ -239,3 +239,30 @@ async def error_prompt(args: dict[str, str]):
 
         with pytest.raises(PromptError):
             await manager.get_prompt("error_prompt", {})
+
+    @pytest.mark.asyncio
+    async def test_update_prompt_rename_does_not_orphan_old_entry(
+        self, prompt_manager, sample_prompt, prompt_function
+    ):
+        """A rename via update_prompt must not leave the old entry orphaned."""
+        await prompt_manager.add_prompt(sample_prompt, prompt_function)
+
+        renamed = sample_prompt.model_copy(update={"name": "greeting_v2"})
+        await prompt_manager.update_prompt(sample_prompt.name, renamed, prompt_function)
+
+        prompts = await prompt_manager.list_prompts()
+        assert len(prompts) == 1
+        assert prompts[0].name == "greeting_v2"
+        with pytest.raises(NotFoundError):
+            await prompt_manager.get_prompt("greeting", {"name": "Bob"})
+        result = await prompt_manager.get_prompt("greeting_v2", {"name": "Bob"})
+        assert isinstance(result, GetPromptResult)
+
+    @pytest.mark.asyncio
+    async def test_update_prompt_missing_raises_not_found(
+        self, prompt_manager, sample_prompt, prompt_function
+    ):
+        """Updating a prompt that does not exist raises NotFoundError."""
+        missing = sample_prompt.model_copy(update={"name": "nope"})
+        with pytest.raises(NotFoundError):
+            await prompt_manager.update_prompt("nope", missing, prompt_function)