diff --git a/plugins/woocommerce-admin/client/customize-store/design-with-ai/services.ts b/plugins/woocommerce-admin/client/customize-store/design-with-ai/services.ts
index b2b2c1d0b22..a069943a4c1 100644
--- a/plugins/woocommerce-admin/client/customize-store/design-with-ai/services.ts
+++ b/plugins/woocommerce-admin/client/customize-store/design-with-ai/services.ts
@@ -473,15 +473,21 @@ const saveAiResponseToOption = ( context: designWithAiStateMachineContext ) => {
 	} );
 };
 
-const resetPatterns = () => async () => {
+const resetPatternsAndProducts = () => async () => {
 	await dispatch( OPTIONS_STORE_NAME ).updateOptions( {
 		woocommerce_blocks_allow_ai_connection: 'yes',
 	} );
 
-	return await apiFetch( {
-		path: '/wc/private/ai/patterns',
-		method: 'DELETE',
-	} );
+	return Promise.all( [
+		apiFetch( {
+			path: '/wc/private/ai/patterns',
+			method: 'DELETE',
+		} ),
+		apiFetch( {
+			path: '/wc/private/ai/products',
+			method: 'DELETE',
+		} ),
+	] );
 };
 
 export const services = {
@@ -491,5 +497,5 @@ export const services = {
 	updateStorePatterns,
 	saveAiResponseToOption,
 	installAndActivateTheme,
-	resetPatterns,
+	resetPatternsAndProducts,
 };
diff --git a/plugins/woocommerce-admin/client/customize-store/design-with-ai/state-machine.tsx b/plugins/woocommerce-admin/client/customize-store/design-with-ai/state-machine.tsx
index e79cd41bd58..5391f132886 100644
--- a/plugins/woocommerce-admin/client/customize-store/design-with-ai/state-machine.tsx
+++ b/plugins/woocommerce-admin/client/customize-store/design-with-ai/state-machine.tsx
@@ -355,7 +355,7 @@ export const designWithAiStateMachineDefinition = createMachine(
 												cond: 'isAiOnline',
 											},
 											{
-												target: 'resetPatterns',
+												target: 'resetPatternsAndProducts',
 											},
 										],
 									},
@@ -373,9 +373,9 @@ export const designWithAiStateMachineDefinition = createMachine(
 											},
 										},
 									},
-									resetPatterns: {
+									resetPatternsAndProducts: {
 										invoke: {
-											src: 'resetPatterns',
+											src: 'resetPatternsAndProducts',
 											onDone: {
 												target: 'success',
 											},
diff --git a/plugins/woocommerce/changelog/41923-41921-cys-ai-offline-flow-reset-products b/plugins/woocommerce/changelog/41923-41921-cys-ai-offline-flow-reset-products
new file mode 100644
index 00000000000..a7bda9153ac
--- /dev/null
+++ b/plugins/woocommerce/changelog/41923-41921-cys-ai-offline-flow-reset-products
@@ -0,0 +1,4 @@
+Significance: minor
+Type: update
+
+CYS: Reset products when the AI is offline.
\ No newline at end of file