diff --git a/app/services/projects/destroy_service.rb b/app/services/projects/destroy_service.rb
index e2b2660ea71..f6e8b6655f2 100644
--- a/app/services/projects/destroy_service.rb
+++ b/app/services/projects/destroy_service.rb
@@ -15,40 +15,48 @@ module Projects
     def execute
       return false unless can?(current_user, :remove_project, project)
 
-      repo_path = project.path_with_namespace
-      wiki_path = repo_path + '.wiki'
-
       # Flush the cache for both repositories. This has to be done _before_
       # removing the physical repositories as some expiration code depends on
       # Git data (e.g. a list of branch names).
-      flush_caches(project, wiki_path)
+      flush_caches(project)
 
       Projects::UnlinkForkService.new(project, current_user).execute
 
-      Project.transaction do
-        project.team.truncate
-        project.destroy!
+      attempt_destroy_transaction(project)
 
-        unless remove_legacy_registry_tags
-          raise_error('Failed to remove some tags in project container registry. Please try again or contact administrator.')
-        end
-
-        unless remove_repository(repo_path)
-          raise_error('Failed to remove project repository. Please try again or contact administrator.')
-        end
-
-        unless remove_repository(wiki_path)
-          raise_error('Failed to remove wiki repository. Please try again or contact administrator.')
-        end
-      end
-
-      log_info("Project \"#{project.path_with_namespace}\" was removed")
       system_hook_service.execute_hooks_for(project, :destroy)
+      log_info("Project \"#{project.full_path}\" was removed")
+
       true
+    rescue => error
+      attempt_rollback(project, error.message)
+      false
+    rescue Exception => error # rubocop:disable Lint/RescueException
+      # Project.transaction can raise Exception
+      attempt_rollback(project, error.message)
+      raise
     end
 
     private
 
+    def repo_path
+      project.path_with_namespace
+    end
+
+    def wiki_path
+      repo_path + '.wiki'
+    end
+
+    def trash_repositories!
+      unless remove_repository(repo_path)
+        raise_error('Failed to remove project repository. Please try again or contact administrator.')
+      end
+
+      unless remove_repository(wiki_path)
+        raise_error('Failed to remove wiki repository. Please try again or contact administrator.')
+      end
+    end
+
     def remove_repository(path)
       # Skip repository removal. We use this flag when remove user or group
       return true if params[:skip_repo] == true
@@ -70,6 +78,26 @@ module Projects
       end
     end
 
+    def attempt_rollback(project, message)
+      return unless project
+
+      project.update_attributes(delete_error: message, pending_delete: false)
+      log_error("Deletion failed on #{project.full_path} with the following message: #{message}")
+    end
+
+    def attempt_destroy_transaction(project)
+      Project.transaction do
+        unless remove_legacy_registry_tags
+          raise_error('Failed to remove some tags in project container registry. Please try again or contact administrator.')
+        end
+
+        trash_repositories!
+
+        project.team.truncate
+        project.destroy!
+      end
+    end
+
     ##
     # This method makes sure that we correctly remove registry tags
     # for legacy image repository (when repository path equals project path).
@@ -96,7 +124,7 @@ module Projects
       "#{path}+#{project.id}#{DELETED_FLAG}"
     end
 
-    def flush_caches(project, wiki_path)
+    def flush_caches(project)
       project.repository.before_delete
 
       Repository.new(wiki_path, project).before_delete
diff --git a/app/views/projects/_deletion_failed.html.haml b/app/views/projects/_deletion_failed.html.haml
new file mode 100644
index 00000000000..4f3698f91e6
--- /dev/null
+++ b/app/views/projects/_deletion_failed.html.haml
@@ -0,0 +1,6 @@
+- project = local_assigns.fetch(:project)
+- return unless project.delete_error.present?
+
+.project-deletion-failed-message.alert.alert-warning
+  This project was scheduled for deletion, but failed with the following message:
+  = project.delete_error
diff --git a/app/views/projects/_flash_messages.html.haml b/app/views/projects/_flash_messages.html.haml
new file mode 100644
index 00000000000..f47d84ef755
--- /dev/null
+++ b/app/views/projects/_flash_messages.html.haml
@@ -0,0 +1,8 @@
+- project = local_assigns.fetch(:project)
+- flash_message_container = show_new_nav? ? :new_global_flash : :flash_message
+
+= content_for flash_message_container do
+  = render partial: 'deletion_failed', locals: { project: project }
+  - if current_user && can?(current_user, :download_code, project)
+    = render 'shared/no_ssh'
+    = render 'shared/no_password'
diff --git a/app/views/projects/empty.html.haml b/app/views/projects/empty.html.haml
index 0f132a68ce1..d17709380d5 100644
--- a/app/views/projects/empty.html.haml
+++ b/app/views/projects/empty.html.haml
@@ -1,10 +1,6 @@
 - @no_container = true
-- flash_message_container = show_new_nav? ? :new_global_flash : :flash_message
 
-= content_for flash_message_container do
-  - if current_user && can?(current_user, :download_code, @project)
-    = render 'shared/no_ssh'
-    = render 'shared/no_password'
+= render partial: 'flash_messages', locals: { project: @project }
 
 = render "projects/head"
 = render "home_panel"
diff --git a/app/views/projects/show.html.haml b/app/views/projects/show.html.haml
index 49d0a6828fe..a9b39cedb1d 100644
--- a/app/views/projects/show.html.haml
+++ b/app/views/projects/show.html.haml
@@ -1,15 +1,11 @@
 - @no_container = true
 - breadcrumb_title "Project"
 - @content_class = "limit-container-width" unless fluid_layout
-- flash_message_container = show_new_nav? ? :new_global_flash : :flash_message
 
 = content_for :meta_tags do
   = auto_discovery_link_tag(:atom, project_path(@project, rss_url_options), title: "#{@project.name} activity")
 
-= content_for flash_message_container do
-  - if current_user && can?(current_user, :download_code, @project)
-    = render 'shared/no_ssh'
-    = render 'shared/no_password'
+= render partial: 'flash_messages', locals: { project: @project }
 
 = render "projects/head"
 = render "projects/last_push"
diff --git a/app/workers/project_destroy_worker.rb b/app/workers/project_destroy_worker.rb
index b462327490e..a9188b78460 100644
--- a/app/workers/project_destroy_worker.rb
+++ b/app/workers/project_destroy_worker.rb
@@ -3,14 +3,11 @@ class ProjectDestroyWorker
   include DedicatedSidekiqQueue
 
   def perform(project_id, user_id, params)
-    begin
-      project = Project.unscoped.find(project_id)
-    rescue ActiveRecord::RecordNotFound
-      return
-    end
-
+    project = Project.find(project_id)
     user = User.find(user_id)
 
     ::Projects::DestroyService.new(project, user, params.symbolize_keys).execute
+  rescue ActiveRecord::RecordNotFound => error
+    logger.error("Failed to delete project (#{project_id}): #{error.message}")
   end
 end
diff --git a/changelogs/unreleased/29289-project-destroy-clean-up-after-failure.yml b/changelogs/unreleased/29289-project-destroy-clean-up-after-failure.yml
new file mode 100644
index 00000000000..488b37ac37f
--- /dev/null
+++ b/changelogs/unreleased/29289-project-destroy-clean-up-after-failure.yml
@@ -0,0 +1,4 @@
+---
+title: Handle errors while a project is being deleted asynchronously.
+merge_request: 11088
+author:
diff --git a/db/migrate/20170428064307_add_column_delete_error_to_projects.rb b/db/migrate/20170428064307_add_column_delete_error_to_projects.rb
new file mode 100644
index 00000000000..09f9d9b5b7a
--- /dev/null
+++ b/db/migrate/20170428064307_add_column_delete_error_to_projects.rb
@@ -0,0 +1,7 @@
+class AddColumnDeleteErrorToProjects < ActiveRecord::Migration
+  DOWNTIME = false
+
+  def change
+    add_column :projects, :delete_error, :text
+  end
+end
diff --git a/db/schema.rb b/db/schema.rb
index 7724af5b610..61bcd8c7e95 100644
--- a/db/schema.rb
+++ b/db/schema.rb
@@ -1134,6 +1134,7 @@ ActiveRecord::Schema.define(version: 20170724214302) do
     t.integer "cached_markdown_version"
     t.datetime "last_repository_updated_at"
     t.string "ci_config_path"
+    t.text "delete_error"
   end
 
   add_index "projects", ["ci_id"], name: "index_projects_on_ci_id", using: :btree
diff --git a/spec/features/projects/show_project_spec.rb b/spec/features/projects/show_project_spec.rb
new file mode 100644
index 00000000000..1bc6fae9e7f
--- /dev/null
+++ b/spec/features/projects/show_project_spec.rb
@@ -0,0 +1,20 @@
+require 'spec_helper'
+
+describe 'Project show page', feature: true do
+  context 'when project pending delete' do
+    let(:project) { create(:project, :empty_repo, pending_delete: true) }
+
+    before do
+      sign_in(project.owner)
+    end
+
+    it 'shows error message if deletion for project fails' do
+      project.update_attributes(delete_error: "Something went wrong", pending_delete: false)
+
+      visit project_path(project)
+
+      expect(page).to have_selector('.project-deletion-failed-message')
+      expect(page).to have_content("This project was scheduled for deletion, but failed with the following message: #{project.delete_error}")
+    end
+  end
+end
diff --git a/spec/lib/gitlab/import_export/safe_model_attributes.yml b/spec/lib/gitlab/import_export/safe_model_attributes.yml
index 4ef3db3721f..0f2db3380a7 100644
--- a/spec/lib/gitlab/import_export/safe_model_attributes.yml
+++ b/spec/lib/gitlab/import_export/safe_model_attributes.yml
@@ -396,6 +396,7 @@ Project:
 - build_allow_git_fetch
 - last_repository_updated_at
 - ci_config_path
+- delete_error
 Author:
 - name
 ProjectFeature:
diff --git a/spec/services/projects/destroy_service_spec.rb b/spec/services/projects/destroy_service_spec.rb
index b399d3402fd..357e09bee95 100644
--- a/spec/services/projects/destroy_service_spec.rb
+++ b/spec/services/projects/destroy_service_spec.rb
@@ -36,6 +36,27 @@ describe Projects::DestroyService, services: true do
     end
   end
 
+  shared_examples 'handles errors thrown during async destroy' do |error_message|
+    it 'does not allow the error to bubble up' do
+      expect do
+        Sidekiq::Testing.inline! { destroy_project(project, user, {}) }
+      end.not_to raise_error
+    end
+
+    it 'unmarks the project as "pending deletion"' do
+      Sidekiq::Testing.inline! { destroy_project(project, user, {}) }
+
+      expect(project.reload.pending_delete).to be(false)
+    end
+
+    it 'stores an error message in `projects.delete_error`' do
+      Sidekiq::Testing.inline! { destroy_project(project, user, {}) }
+
+      expect(project.reload.delete_error).to be_present
+      expect(project.delete_error).to include(error_message)
+    end
+  end
+
   context 'Sidekiq inline' do
     before do
       # Run sidekiq immediatly to check that renamed repository will be removed
@@ -89,10 +110,51 @@ describe Projects::DestroyService, services: true do
     end
 
     it_behaves_like 'deleting the project with pipeline and build'
-  end
 
-  context 'with execute' do
-    it_behaves_like 'deleting the project with pipeline and build'
+    context 'errors' do
+      context 'when `remove_legacy_registry_tags` fails' do
+        before do
+          expect_any_instance_of(Projects::DestroyService)
+            .to receive(:remove_legacy_registry_tags).and_return(false)
+        end
+
+        it_behaves_like 'handles errors thrown during async destroy', "Failed to remove some tags"
+      end
+
+      context 'when `remove_repository` fails' do
+        before do
+          expect_any_instance_of(Projects::DestroyService)
+            .to receive(:remove_repository).and_return(false)
+        end
+
+        it_behaves_like 'handles errors thrown during async destroy', "Failed to remove project repository"
+      end
+
+      context 'when `execute` raises expected error' do
+        before do
+          expect_any_instance_of(Project)
+            .to receive(:destroy!).and_raise(StandardError.new("Other error message"))
+        end
+
+        it_behaves_like 'handles errors thrown during async destroy', "Other error message"
+      end
+
+      context 'when `execute` raises unexpected error' do
+        before do
+          expect_any_instance_of(Project)
+            .to receive(:destroy!).and_raise(Exception.new("Other error message"))
+        end
+
+        it 'allows error to bubble up and rolls back project deletion' do
+          expect do
+            Sidekiq::Testing.inline! { destroy_project(project, user, {}) }
+          end.to raise_error
+
+          expect(project.reload.pending_delete).to be(false)
+          expect(project.delete_error).to include("Other error message")
+        end
+      end
+    end
   end
 
   describe 'container registry' do
@@ -119,8 +181,7 @@ describe Projects::DestroyService, services: true do
           expect_any_instance_of(ContainerRepository)
             .to receive(:delete_tags!).and_return(false)
 
-          expect{ destroy_project(project, user) }
-            .to raise_error(ActiveRecord::RecordNotDestroyed)
+          expect(destroy_project(project, user)).to be false
         end
       end
     end
@@ -145,8 +206,7 @@ describe Projects::DestroyService, services: true do
           expect_any_instance_of(ContainerRepository)
             .to receive(:delete_tags!).and_return(false)
 
-          expect { destroy_project(project, user) }
-            .to raise_error(Projects::DestroyService::DestroyError)
+          expect(destroy_project(project, user)).to be false
         end
       end
     end
diff --git a/spec/workers/project_destroy_worker_spec.rb b/spec/workers/project_destroy_worker_spec.rb
index 3d135f40c1f..f19c9dff941 100644
--- a/spec/workers/project_destroy_worker_spec.rb
+++ b/spec/workers/project_destroy_worker_spec.rb
@@ -1,24 +1,36 @@
 require 'spec_helper'
 
 describe ProjectDestroyWorker do
-  let(:project) { create(:project, :repository) }
+  let(:project) { create(:project, :repository, pending_delete: true) }
   let(:path) { project.repository.path_to_repo }
 
   subject { described_class.new }
 
-  describe "#perform" do
-    it "deletes the project" do
+  describe '#perform' do
+    it 'deletes the project' do
       subject.perform(project.id, project.owner.id, {})
 
       expect(Project.all).not_to include(project)
       expect(Dir.exist?(path)).to be_falsey
     end
 
-    it "deletes the project but skips repo deletion" do
+    it 'deletes the project but skips repo deletion' do
       subject.perform(project.id, project.owner.id, { "skip_repo" => true })
 
       expect(Project.all).not_to include(project)
       expect(Dir.exist?(path)).to be_truthy
     end
+
+    it 'does not raise error when project could not be found' do
+      expect do
+        subject.perform(-1, project.owner.id, {})
+      end.not_to raise_error
+    end
+
+    it 'does not raise error when user could not be found' do
+      expect do
+        subject.perform(project.id, -1, {})
+      end.not_to raise_error
+    end
   end
 end