diff --git a/taf/tests/test_updater/test_interrupt_handling.py b/taf/tests/test_updater/test_interrupt_handling.py
new file mode 100644
index 00000000..ee2ffd26
--- /dev/null
+++ b/taf/tests/test_updater/test_interrupt_handling.py
@@ -0,0 +1,56 @@
+import os
+import signal
+import pytest
+from pathlib import Path
+
+from taf.exceptions import UpdateFailedError
+from taf.updater.updater import update_repository
+from taf.updater.updater import UpdateConfig
+from taf.updater.types.update import OperationType
+from taf.git import GitRepository
+
+
+class DummyRepo:
+    """Fake empty git repo used for path presence."""
+    def __init__(self, path):
+        self.path = path
+        self.name = "dummy"
+        self.is_git_repository = True
+        self.is_bare_repository = False
+
+    def get_remote_url(self):
+        return "https://example.com/repo.git"
+
+
+@pytest.fixture
+def fake_repo(tmp_path, monkeypatch):
+    """Create a tmp directory and mock GitRepository so no actual git commands run."""
+    repo_path = tmp_path / "auth"
+    repo_path.mkdir(parents=True, exist_ok=True)
+
+    monkeypatch.setattr("taf.updater.updater.GitRepository", lambda path: DummyRepo(path))
+
+    return repo_path
+
+
+def test_update_repository_interrupts_gracefully(fake_repo, monkeypatch):
+    """
+    Simulate Ctrl+C (SIGINT) during update_repository and ensure UpdateFailedError is raised.
+    """
+
+    config = UpdateConfig(
+        path=fake_repo,
+        operation=OperationType.UPDATE,
+        remote_url="https://example.com/repo.git",
+        strict=True,
+        run_scripts=False,
+    )
+
+    def fake_update(*args, **kwargs):
+        # Immediately simulate Ctrl+C by sending SIGINT to the current process
+        os.kill(os.getpid(), signal.SIGINT)
+
+    monkeypatch.setattr("taf.updater.updater._update_or_clone_repository", fake_update)
+
+    with pytest.raises(UpdateFailedError, match="interrupted"):
+        update_repository(config)
diff --git a/taf/updater/updater.py b/taf/updater/updater.py
index 6315b6d8..f06f487c 100644
--- a/taf/updater/updater.py
+++ b/taf/updater/updater.py
@@ -26,6 +26,7 @@
 loads data from a most recent commit.
 """
 import copy
+import signal
 from logging import ERROR
 
 from typing import Dict, Tuple, Any
@@ -327,29 +328,45 @@ def update_repository(config: UpdateConfig):
     Returns:
         None
     """
-    settings.strict = config.strict
-    settings.run_scripts = config.run_scripts
 
-    # if path is not specified, name should be read from info.json
-    # which is available after the remote repository is cloned and validated
+    # --- Graceful Ctrl+C / SIGTERM handling ---
+    interrupted = {"flag": False}
 
-    auth_repo = GitRepository(path=config.path)
-    if not config.path.is_dir() or not auth_repo.is_git_repository:
-        raise UpdateFailedError(
-            f"{config.path} is not a Git repository. Run 'taf repo clone' instead"
-        )
+    def _handle_interrupt(signum, frame):
+        interrupted["flag"] = True
+        raise UpdateFailedError("Update interrupted by user (Ctrl+C)")
 
-    taf_logger.info(f"Updating repository {auth_repo.name}")
+    old_sigint = signal.signal(signal.SIGINT, _handle_interrupt)
+    old_sigterm = signal.signal(signal.SIGTERM, _handle_interrupt)
+
+    try:
+        # --- BEGIN ORIGINAL UNMODIFIED LOGIC ---
+        settings.strict = config.strict
+        settings.run_scripts = config.run_scripts
+
+        auth_repo = GitRepository(path=config.path)
+        if not config.path.is_dir() or not auth_repo.is_git_repository:
+            raise UpdateFailedError(
+                f"{config.path} is not a Git repository. Run 'taf repo clone' instead"
+            )
+
+        taf_logger.info(f"Updating repository {auth_repo.name}")
 
-    if config.remote_url is None:
-        config.remote_url = auth_repo.get_remote_url()
         if config.remote_url is None:
-            raise UpdateFailedError("URL cannot be determined. Please specify it")
+            config.remote_url = auth_repo.get_remote_url()
+            if config.remote_url is None:
+                raise UpdateFailedError("URL cannot be determined. Please specify it")
 
-    if auth_repo.is_bare_repository:
-        # Handle updates for bare repositories
-        config.bare = True
-    return _update_or_clone_repository(config)
+        if auth_repo.is_bare_repository:
+            config.bare = True
+
+        return _update_or_clone_repository(config)
+        # --- END ORIGINAL LOGIC ---
+
+    finally:
+        # Restore original handlers so we do not break global signal behavior
+        signal.signal(signal.SIGINT, old_sigint)
+        signal.signal(signal.SIGTERM, old_sigterm)
 
 
 def _update_or_clone_repository(config: UpdateConfig):