diff --git a/internal/controller/kustomization_controller.go b/internal/controller/kustomization_controller.go
index b73159b2..019f4f58 100644
--- a/internal/controller/kustomization_controller.go
+++ b/internal/controller/kustomization_controller.go
@@ -275,9 +275,14 @@ func (r *KustomizationReconciler) Reconcile(ctx context.Context, req ctrl.Reques
 	// Reconcile the latest revision.
 	reconcileErr := r.reconcile(ctx, obj, artifactSource, patcher, statusReader)
 
-	// Requeue at the specified retry interval if the artifact tarball is not found.
-	if errors.Is(reconcileErr, fetch.ErrFileNotFound) {
-		msg := fmt.Sprintf("Source is not ready, artifact not found, retrying in %s", r.DependencyRequeueInterval.String())
+	// Requeue at the dependency interval if the artifact tarball is not found or
+	// its digest doesn't match, as the source status may not be updated yet.
+	if errors.Is(reconcileErr, fetch.ErrFileNotFound) || errors.Is(reconcileErr, fetch.ErrDigestMismatch) {
+		cause := "artifact not found"
+		if errors.Is(reconcileErr, fetch.ErrDigestMismatch) {
+			cause = "artifact digest changed"
+		}
+		msg := fmt.Sprintf("Source is not ready, %s, retrying in %s", cause, r.DependencyRequeueInterval.String())
 		conditions.MarkFalse(obj, meta.ReadyCondition, meta.ArtifactFailedReason, "%s", msg)
 		log.Info(msg)
 		return ctrl.Result{RequeueAfter: r.DependencyRequeueInterval}, nil
diff --git a/internal/controller/kustomization_fetcher_test.go b/internal/controller/kustomization_fetcher_test.go
index a497318d..2830de8e 100644
--- a/internal/controller/kustomization_fetcher_test.go
+++ b/internal/controller/kustomization_fetcher_test.go
@@ -19,6 +19,8 @@ package controller
 import (
 	"context"
 	"fmt"
+	"os"
+	"path/filepath"
 	"strings"
 	"testing"
 	"time"
@@ -27,6 +29,7 @@ import (
 	"github.com/fluxcd/pkg/testserver"
 	sourcev1 "github.com/fluxcd/source-controller/api/v1"
 	. "github.com/onsi/gomega"
+	"github.com/opencontainers/go-digest"
 	apimeta "k8s.io/apimachinery/pkg/api/meta"
 	metav1 "k8s.io/apimachinery/pkg/apis/meta/v1"
 	"k8s.io/apimachinery/pkg/types"
@@ -119,6 +122,7 @@ stringData:
 	}
 	g.Expect(k8sClient.Get(context.Background(), repositoryName, repo)).Should(Succeed())
 	repoURL := repo.Status.Artifact.URL
+	repoDigest := repo.Status.Artifact.Digest
 
 	t.Run("downloads artifact", func(t *testing.T) {
 		g.Eventually(func() bool {
@@ -151,4 +155,40 @@ stringData:
 			return apimeta.IsStatusConditionTrue(resultK.Status.Conditions, meta.ReadyCondition)
 		}, timeout, time.Second).Should(BeTrue())
 	})
+
+	// Advertise the digest of a rebuilt artifact while the old one is still served.
+	rebuilt, err := testServer.ArtifactFromFiles(manifests(id, randStringRunes(5)))
+	g.Expect(err).NotTo(HaveOccurred(), "failed to create artifact from files")
+	rebuiltData, err := os.ReadFile(filepath.Join(testServer.Root(), rebuilt))
+	g.Expect(err).NotTo(HaveOccurred())
+	rebuiltDigest := digest.SHA256.FromBytes(rebuiltData).String()
+	g.Expect(rebuiltDigest).NotTo(Equal(repoDigest))
+
+	t.Run("retries on digest mismatch errors", func(t *testing.T) {
+		g.Expect(k8sClient.Get(context.Background(), repositoryName, repo)).Should(Succeed())
+		repo.Status.Artifact.Digest = rebuiltDigest
+		repo.ManagedFields = nil
+		g.Expect(k8sClient.Status().Update(context.Background(), repo)).To(Succeed())
+
+		g.Eventually(func() bool {
+			_ = k8sClient.Get(context.Background(), client.ObjectKeyFromObject(kustomization), resultK)
+			ready := apimeta.FindStatusCondition(resultK.Status.Conditions, meta.ReadyCondition)
+			return ready != nil &&
+				ready.Status == metav1.ConditionFalse &&
+				ready.Reason == meta.ArtifactFailedReason &&
+				strings.Contains(ready.Message, "artifact digest changed, retrying in")
+		}, timeout, time.Second).Should(BeTrue())
+	})
+
+	t.Run("recovers after digest mismatch errors", func(t *testing.T) {
+		// Serve the rebuilt artifact at the old URL without changing the source,
+		// the Kustomization must recover on requeue.
+		artifactName := strings.TrimPrefix(repoURL, testServer.URL()+"/")
+		g.Expect(os.WriteFile(filepath.Join(testServer.Root(), artifactName), rebuiltData, 0o644)).To(Succeed())
+
+		g.Eventually(func() bool {
+			_ = k8sClient.Get(context.Background(), client.ObjectKeyFromObject(kustomization), resultK)
+			return apimeta.IsStatusConditionTrue(resultK.Status.Conditions, meta.ReadyCondition)
+		}, timeout, time.Second).Should(BeTrue())
+	})
 }