diff --git a/src/p2p/p2p.cpp b/src/p2p/p2p.cpp
index 66996f7a..145d1ff1 100644
--- a/src/p2p/p2p.cpp
+++ b/src/p2p/p2p.cpp
@@ -494,6 +494,12 @@ namespace p2p
                     continue;
                 }
 
+                if (ctx.server->dead_known_peers.exists(peer.ip_port.to_string()))
+                {
+                    LOG_DEBUG << "Rejecting " + peer.ip_port.to_string() + ". Peer was removed prior due to unavailability.";
+                    continue;
+                }
+
                 const auto itr = std::find_if(ctx.server->req_known_remotes.begin(), ctx.server->req_known_remotes.end(), [&](peer_properties &p)
                                               { return p.ip_port == peer.ip_port; });
 
diff --git a/src/p2p/p2p.hpp b/src/p2p/p2p.hpp
index 688d0802..534d13ac 100644
--- a/src/p2p/p2p.hpp
+++ b/src/p2p/p2p.hpp
@@ -31,6 +31,7 @@ namespace p2p
         int16_t available_capacity = -1;
         uint64_t timestamp = 0;
         int64_t weight = 0;
+        int32_t failed_attempts = 0;
     };
 
     struct proposal
diff --git a/src/p2p/peer_comm_server.cpp b/src/p2p/peer_comm_server.cpp
index badcef52..a68e2faf 100644
--- a/src/p2p/peer_comm_server.cpp
+++ b/src/p2p/peer_comm_server.cpp
@@ -11,6 +11,9 @@
 namespace p2p
 {
     constexpr float WEAKLY_CONNECTED_THRESHOLD = 0.7;
+    constexpr int16_t PEER_FAILED_THRESHOLD = 10;
+    // Peer will be removed from the dead known peers collection after this period of time.
+    constexpr int32_t DEAD_PEER_TIMEOUT = 5 * 60 * 1000; // 5 minutes.
 
     peer_comm_server::peer_comm_server(const uint16_t port, const uint64_t (&metric_thresholds)[5], const uint64_t max_msg_size,
                                        const uint64_t max_in_connections, const uint64_t max_in_connections_per_host,
@@ -134,6 +137,9 @@ namespace p2p
             peer_check_list = req_known_remotes;
         }
 
+        bool connections_changed = false;
+        std::vector<conf::peer_ip_port> failed_nodes;
+
         for (const auto &peer : peer_check_list)
         {
             if (is_shutting_down)
@@ -171,7 +177,14 @@ namespace p2p
             {
                 const hpws::error error = std::get<hpws::error>(client_result);
                 if (error.first != 202)
+                {
                     LOG_DEBUG << "Outbound connection hpws error:" << error.first << " " << error.second;
+                    if (conf::cfg.mesh.peer_discovery.enabled)
+                    {
+                        failed_nodes.push_back(peer.ip_port);
+                        connections_changed = true;
+                    }
+                }
             }
             else
             {
@@ -199,9 +212,34 @@ namespace p2p
 
                     std::scoped_lock<std::mutex> lock(new_sessions_mutex);
                     new_sessions.emplace_back(std::move(session));
+                    connections_changed = true;
                 }
             }
         }
+        if (conf::cfg.mesh.peer_discovery.enabled && connections_changed)
+        {
+            // Copy failed attempt data from failed_nodes to req_known_remotes.
+            std::scoped_lock<std::mutex> lock(req_known_remotes_mutex);
+
+            for (auto it = req_known_remotes.begin(); it != req_known_remotes.end();)
+            {
+                const auto itr = std::find(failed_nodes.begin(), failed_nodes.end(), it->ip_port);
+                if (itr != failed_nodes.end())
+                    it->failed_attempts++;
+                else if (it->failed_attempts > 0) // Reset failed attempts count if the connection succeeds.
+                    it->failed_attempts = 0;
+
+                if (it->failed_attempts >= PEER_FAILED_THRESHOLD)
+                {
+                    LOG_INFO << "Removed " << it->ip_port.to_string() << " from known peer list due to unavailability.";
+                    // Add the dead nodes ip data to reject same peer from peer discovery responses.
+                    dead_known_peers.emplace(it->ip_port.to_string(), DEAD_PEER_TIMEOUT);
+                    it = req_known_remotes.erase(it);
+                }
+                else
+                    ++it;
+            }
+        }
     }
     /**
      * Check whether the node is weakly connected or strongly connected.
diff --git a/src/p2p/peer_comm_server.hpp b/src/p2p/peer_comm_server.hpp
index 33dce2ec..1ecc259c 100644
--- a/src/p2p/peer_comm_server.hpp
+++ b/src/p2p/peer_comm_server.hpp
@@ -2,6 +2,7 @@
 #define _HP_P2P_PEER_COMM_SERVER_
 
 #include "../comm/comm_server.hpp"
+#include "../util/ttl_set.hpp"
 #include "peer_comm_session.hpp"
 
 namespace p2p
@@ -28,6 +29,7 @@ namespace p2p
         std::atomic<uint16_t> known_remote_count = 0;
         std::mutex req_known_remotes_mutex;
         std::vector<peer_properties> req_known_remotes;
+        util::ttl_set dead_known_peers;
         peer_comm_server(const uint16_t port, const uint64_t (&metric_thresholds)[5], const uint64_t max_msg_size,
                          const uint64_t max_in_connections, const uint64_t max_in_connections_per_host,
                          const std::vector<peer_properties> &req_known_remotes);