diff --git a/internal/apply/v2/manager.go b/internal/apply/v2/manager.go
index 4866129..f43e933 100644
--- a/internal/apply/v2/manager.go
+++ b/internal/apply/v2/manager.go
@@ -4,7 +4,9 @@ package v2
 
 import (
 	"context"
+	"errors"
 	"fmt"
+	"strings"
 	"time"
 
 	"edp.buildth.ing/DevFW-CICD/edge-connect-client/v2/internal/config"
@@ -204,7 +206,8 @@ func (rm *EdgeConnectResourceManager) RollbackDeployment(ctx context.Context, re
 
 	rollbackErrors := []error{}
 
-	// Rollback completed instances (in reverse order)
+	// Phase 1: Delete resources that were created in this deployment attempt (in reverse order)
+	rm.logf("Phase 1: Rolling back created resources")
 	for i := len(result.CompletedActions) - 1; i >= 0; i-- {
 		action := result.CompletedActions[i]
 
@@ -218,6 +221,32 @@ func (rm *EdgeConnectResourceManager) RollbackDeployment(ctx context.Context, re
 		}
 	}
 
+	// Phase 2: Restore resources that were deleted before the failed deployment
+	// This is critical for RecreateStrategy which deletes everything before recreating
+	if result.DeletedAppBackup != nil || len(result.DeletedInstancesBackup) > 0 {
+		rm.logf("Phase 2: Restoring deleted resources")
+
+		// Restore app first (must exist before instances can be created)
+		if result.DeletedAppBackup != nil {
+			if err := rm.restoreApp(ctx, result.DeletedAppBackup); err != nil {
+				rollbackErrors = append(rollbackErrors, fmt.Errorf("failed to restore app: %w", err))
+				rm.logf("Failed to restore app: %v", err)
+			} else {
+				rm.logf("Successfully restored app: %s", result.DeletedAppBackup.App.Key.Name)
+			}
+		}
+
+		// Restore instances
+		for _, backup := range result.DeletedInstancesBackup {
+			if err := rm.restoreInstance(ctx, &backup); err != nil {
+				rollbackErrors = append(rollbackErrors, fmt.Errorf("failed to restore instance %s: %w", backup.Instance.Key.Name, err))
+				rm.logf("Failed to restore instance %s: %v", backup.Instance.Key.Name, err)
+			} else {
+				rm.logf("Successfully restored instance: %s", backup.Instance.Key.Name)
+			}
+		}
+	}
+
 	if len(rollbackErrors) > 0 {
 		return fmt.Errorf("rollback encountered %d errors: %v", len(rollbackErrors), rollbackErrors)
 	}
@@ -278,6 +307,125 @@ func (rm *EdgeConnectResourceManager) rollbackInstance(ctx context.Context, acti
 	return fmt.Errorf("instance action not found for rollback: %s", action.Target)
 }
 
+// restoreApp recreates an app that was deleted during deployment
+func (rm *EdgeConnectResourceManager) restoreApp(ctx context.Context, backup *AppBackup) error {
+	rm.logf("Restoring app: %s/%s version %s",
+		backup.App.Key.Organization, backup.App.Key.Name, backup.App.Key.Version)
+
+	// Build a clean app input with only creation-safe fields
+	// We must exclude read-only fields like CreatedAt, UpdatedAt, etc.
+	appInput := &v2.NewAppInput{
+		Region: backup.Region,
+		App: v2.App{
+			Key:                          backup.App.Key,
+			Deployment:                   backup.App.Deployment,
+			ImageType:                    backup.App.ImageType,
+			ImagePath:                    backup.App.ImagePath,
+			AllowServerless:              backup.App.AllowServerless,
+			DefaultFlavor:                backup.App.DefaultFlavor,
+			ServerlessConfig:             backup.App.ServerlessConfig,
+			DeploymentManifest:           backup.App.DeploymentManifest,
+			DeploymentGenerator:          backup.App.DeploymentGenerator,
+			RequiredOutboundConnections:  backup.App.RequiredOutboundConnections,
+			// Explicitly omit read-only fields like CreatedAt, UpdatedAt, Fields, etc.
+		},
+	}
+
+	if err := rm.client.CreateApp(ctx, appInput); err != nil {
+		return fmt.Errorf("failed to restore app: %w", err)
+	}
+
+	rm.logf("Successfully restored app: %s", backup.App.Key.Name)
+	return nil
+}
+
+// restoreInstance recreates an instance that was deleted during deployment
+func (rm *EdgeConnectResourceManager) restoreInstance(ctx context.Context, backup *InstanceBackup) error {
+	rm.logf("Restoring instance: %s on %s:%s",
+		backup.Instance.Key.Name,
+		backup.Instance.Key.CloudletKey.Organization,
+		backup.Instance.Key.CloudletKey.Name)
+
+	// Build a clean instance input with only creation-safe fields
+	// We must exclude read-only fields like CloudletLoc, CreatedAt, etc.
+	instanceInput := &v2.NewAppInstanceInput{
+		Region: backup.Region,
+		AppInst: v2.AppInstance{
+			Key:    backup.Instance.Key,
+			AppKey: backup.Instance.AppKey,
+			Flavor: backup.Instance.Flavor,
+			// Explicitly omit read-only fields like CloudletLoc, State, PowerState, CreatedAt, etc.
+		},
+	}
+
+	// Retry logic to handle namespace termination race conditions
+	maxRetries := 5
+	retryDelay := 10 * time.Second
+
+	var lastErr error
+	for attempt := 0; attempt <= maxRetries; attempt++ {
+		if attempt > 0 {
+			rm.logf("Retrying instance restore %s (attempt %d/%d)", backup.Instance.Key.Name, attempt, maxRetries)
+			select {
+			case <-time.After(retryDelay):
+			case <-ctx.Done():
+				return ctx.Err()
+			}
+		}
+
+		err := rm.client.CreateAppInstance(ctx, instanceInput)
+		if err == nil {
+			rm.logf("Successfully restored instance: %s", backup.Instance.Key.Name)
+			return nil
+		}
+
+		lastErr = err
+
+		// Check if error is retryable
+		if !rm.isRetryableError(err) {
+			rm.logf("Failed to restore instance %s: %v (non-retryable error, giving up)", backup.Instance.Key.Name, err)
+			return fmt.Errorf("failed to restore instance: %w", err)
+		}
+
+		if attempt < maxRetries {
+			rm.logf("Failed to restore instance %s: %v (will retry)", backup.Instance.Key.Name, err)
+		}
+	}
+
+	return fmt.Errorf("failed to restore instance after %d attempts: %w", maxRetries+1, lastErr)
+}
+
+// isRetryableError determines if an error should be retried
+func (rm *EdgeConnectResourceManager) isRetryableError(err error) bool {
+	if err == nil {
+		return false
+	}
+
+	errStr := strings.ToLower(err.Error())
+
+	// Special case: Kubernetes namespace termination race condition
+	// This is a transient 400 error that should be retried
+	if strings.Contains(errStr, "being terminated") || strings.Contains(errStr, "is being terminated") {
+		return true
+	}
+
+	// Check if it's an APIError with a status code
+	var apiErr *v2.APIError
+	if errors.As(err, &apiErr) {
+		// Don't retry client errors (4xx)
+		if apiErr.StatusCode >= 400 && apiErr.StatusCode < 500 {
+			return false
+		}
+		// Retry server errors (5xx)
+		if apiErr.StatusCode >= 500 {
+			return true
+		}
+	}
+
+	// Retry all other errors (network issues, timeouts, etc.)
+	return true
+}
+
 // logf logs a message if a logger is configured
 func (rm *EdgeConnectResourceManager) logf(format string, v ...interface{}) {
 	if rm.logger != nil {
diff --git a/internal/apply/v2/manager_test.go b/internal/apply/v2/manager_test.go
index dd2fc55..6d5ef18 100644
--- a/internal/apply/v2/manager_test.go
+++ b/internal/apply/v2/manager_test.go
@@ -7,6 +7,7 @@ import (
 	"fmt"
 	"os"
 	"path/filepath"
+	"strings"
 	"testing"
 	"time"
 
@@ -464,6 +465,111 @@ func TestRollbackDeploymentFailure(t *testing.T) {
 	mockClient.AssertExpectations(t)
 }
 
+func TestRollbackDeploymentWithRestore(t *testing.T) {
+	mockClient := &MockResourceClient{}
+	logger := &TestLogger{}
+	manager := NewResourceManager(mockClient, WithLogger(logger), WithStrategyConfig(createTestStrategyConfig()))
+
+	plan := createTestDeploymentPlan()
+
+	// Simulate a RecreateStrategy scenario:
+	// 1. Old app and instance were deleted and backed up
+	// 2. New app was created successfully
+	// 3. New instance creation failed
+	// 4. Rollback should: delete new app, restore old app, restore old instance
+	oldApp := v2.App{
+		Key: v2.AppKey{
+			Organization: "test-org",
+			Name:         "test-app",
+			Version:      "1.0.0",
+		},
+		Deployment:         "kubernetes",
+		DeploymentManifest: "old-manifest-content",
+	}
+
+	oldInstance := v2.AppInstance{
+		Key: v2.AppInstanceKey{
+			Organization: "test-org",
+			Name:         "test-app-1.0.0-instance",
+			CloudletKey: v2.CloudletKey{
+				Organization: "test-cloudlet-org",
+				Name:         "test-cloudlet",
+			},
+		},
+		AppKey: v2.AppKey{
+			Organization: "test-org",
+			Name:         "test-app",
+			Version:      "1.0.0",
+		},
+		Flavor: v2.Flavor{Name: "small"},
+	}
+
+	result := &ExecutionResult{
+		Plan: plan,
+		// Completed actions: new app was created before failure
+		CompletedActions: []ActionResult{
+			{
+				Type:    ActionCreate,
+				Target:  "test-app",
+				Success: true,
+			},
+		},
+		// Failed action: new instance creation failed
+		FailedActions: []ActionResult{
+			{
+				Type:    ActionCreate,
+				Target:  "test-app-1.0.0-instance",
+				Success: false,
+			},
+		},
+		// Backup of deleted resources
+		DeletedAppBackup: &AppBackup{
+			App:             oldApp,
+			Region:          "US",
+			ManifestContent: "old-manifest-content",
+		},
+		DeletedInstancesBackup: []InstanceBackup{
+			{
+				Instance: oldInstance,
+				Region:   "US",
+			},
+		},
+	}
+
+	// Mock rollback operations in order:
+	// 1. Delete newly created app (rollback create)
+	mockClient.On("DeleteApp", mock.Anything, mock.AnythingOfType("v2.AppKey"), "US").
+		Return(nil).Once()
+
+	// 2. Restore old app (from backup)
+	mockClient.On("CreateApp", mock.Anything, mock.MatchedBy(func(input *v2.NewAppInput) bool {
+		return input.App.Key.Name == "test-app" && input.App.DeploymentManifest == "old-manifest-content"
+	})).Return(nil).Once()
+
+	// 3. Restore old instance (from backup)
+	mockClient.On("CreateAppInstance", mock.Anything, mock.MatchedBy(func(input *v2.NewAppInstanceInput) bool {
+		return input.AppInst.Key.Name == "test-app-1.0.0-instance"
+	})).Return(nil).Once()
+
+	ctx := context.Background()
+	err := manager.RollbackDeployment(ctx, result)
+
+	require.NoError(t, err)
+	mockClient.AssertExpectations(t)
+
+	// Verify rollback was logged
+	assert.Greater(t, len(logger.messages), 0)
+	// Should have messages about rolling back created resources and restoring deleted resources
+	hasRestoreLog := false
+	for _, msg := range logger.messages {
+		if strings.Contains(msg, "Restoring deleted resources") {
+			hasRestoreLog = true
+			break
+		}
+	}
+	assert.True(t, hasRestoreLog, "Should log restoration of deleted resources")
+}
+
 func TestConvertNetworkRules(t *testing.T) {
 	network := &config.NetworkConfig{
 		OutboundConnections: []config.OutboundConnection{
diff --git a/internal/apply/v2/strategy_recreate.go b/internal/apply/v2/strategy_recreate.go
index 89c9c56..4d81029 100644
--- a/internal/apply/v2/strategy_recreate.go
+++ b/internal/apply/v2/strategy_recreate.go
@@ -159,6 +159,19 @@ func (r *RecreateStrategy) deleteInstancesPhase(ctx context.Context, plan *Deplo
 		return nil
 	}
 
+	// Backup instances before deleting them (for rollback restoration)
+	r.logf("Backing up %d existing instances before deletion", len(instancesToDelete))
+	for _, action := range instancesToDelete {
+		backup, err := r.backupInstance(ctx, action, config)
+		if err != nil {
+			r.logf("Warning: failed to backup instance %s before deletion: %v", action.InstanceName, err)
+			// Continue with deletion even if backup fails - this is best effort
+		} else {
+			result.DeletedInstancesBackup = append(result.DeletedInstancesBackup, *backup)
+			r.logf("Backed up instance: %s", action.InstanceName)
+		}
+	}
+
 	deleteResults := r.executeInstanceActionsWithRetry(ctx, instancesToDelete, "delete", config)
 
 	for _, deleteResult := range deleteResults {
@@ -172,6 +185,19 @@ func (r *RecreateStrategy) deleteInstancesPhase(ctx context.Context, plan *Deplo
 	}
 
 	r.logf("Phase 1 complete: deleted %d instances", len(deleteResults))
+
+	// Wait for Kubernetes namespace termination to complete
+	// This prevents "namespace is being terminated" errors when recreating instances
+	if len(deleteResults) > 0 {
+		waitTime := 5 * time.Second
+		r.logf("Waiting %v for namespace termination to complete...", waitTime)
+		select {
+		case <-time.After(waitTime):
+		case <-ctx.Done():
+			return ctx.Err()
+		}
+	}
+
 	return nil
 }
 
@@ -184,6 +210,17 @@ func (r *RecreateStrategy) deleteAppPhase(ctx context.Context, plan *DeploymentP
 
 	r.logf("Phase 2: Deleting existing application")
 
+	// Backup app before deleting it (for rollback restoration)
+	r.logf("Backing up existing app before deletion")
+	backup, err := r.backupApp(ctx, plan, config)
+	if err != nil {
+		r.logf("Warning: failed to backup app before deletion: %v", err)
+		// Continue with deletion even if backup fails - this is best effort
+	} else {
+		result.DeletedAppBackup = backup
+		r.logf("Backed up app: %s", plan.AppAction.Desired.Name)
+	}
+
 	appKey := v2.AppKey{
 		Organization: plan.AppAction.Desired.Organization,
 		Name:         plan.AppAction.Desired.Name,
@@ -516,6 +553,52 @@ func (r *RecreateStrategy) updateApplication(ctx context.Context, action AppActi
 	return true, nil
 }
 
+// backupApp fetches and stores the current app state before deletion
+func (r *RecreateStrategy) backupApp(ctx context.Context, plan *DeploymentPlan, config *config.EdgeConnectConfig) (*AppBackup, error) {
+	appKey := v2.AppKey{
+		Organization: plan.AppAction.Desired.Organization,
+		Name:         plan.AppAction.Desired.Name,
+		Version:      plan.AppAction.Desired.Version,
+	}
+
+	app, err := r.client.ShowApp(ctx, appKey, plan.AppAction.Desired.Region)
+	if err != nil {
+		return nil, fmt.Errorf("failed to fetch app for backup: %w", err)
+	}
+
+	backup := &AppBackup{
+		App:             app,
+		Region:          plan.AppAction.Desired.Region,
+		ManifestContent: app.DeploymentManifest,
+	}
+
+	return backup, nil
+}
+
+// backupInstance fetches and stores the current instance state before deletion
+func (r *RecreateStrategy) backupInstance(ctx context.Context, action InstanceAction, config *config.EdgeConnectConfig) (*InstanceBackup, error) {
+	instanceKey := v2.AppInstanceKey{
+		Organization: action.Desired.Organization,
+		Name:         action.InstanceName,
+		CloudletKey: v2.CloudletKey{
+			Organization: action.Target.CloudletOrg,
+			Name:         action.Target.CloudletName,
+		},
+	}
+
+	instance, err := r.client.ShowAppInstance(ctx, instanceKey, action.Target.Region)
+	if err != nil {
+		return nil, fmt.Errorf("failed to fetch instance for backup: %w", err)
+	}
+
+	backup := &InstanceBackup{
+		Instance: instance,
+		Region:   action.Target.Region,
+	}
+
+	return backup, nil
+}
+
 // logf logs a message if a logger is configured
 func (r *RecreateStrategy) logf(format string, v ...interface{}) {
 	if r.logger != nil {
@@ -530,6 +613,14 @@ func isRetryableError(err error) bool {
 		return false
 	}
 
+	errStr := strings.ToLower(err.Error())
+
+	// Special case: Kubernetes namespace termination race condition
+	// This is a transient 400 error that should be retried
+	if strings.Contains(errStr, "being terminated") || strings.Contains(errStr, "is being terminated") {
+		return true
+	}
+
 	// Check if it's an APIError with a status code
 	var apiErr *v2.APIError
 	if errors.As(err, &apiErr) {
diff --git a/internal/apply/v2/types.go b/internal/apply/v2/types.go
index ae52420..26d998e 100644
--- a/internal/apply/v2/types.go
+++ b/internal/apply/v2/types.go
@@ -271,6 +271,12 @@ type ExecutionResult struct {
 
 	// RollbackSuccess indicates if rollback was successful
 	RollbackSuccess bool
+
+	// DeletedAppBackup stores the app that was deleted (for rollback restoration)
+	DeletedAppBackup *AppBackup
+
+	// DeletedInstancesBackup stores instances that were deleted (for rollback restoration)
+	DeletedInstancesBackup []InstanceBackup
 }
 
 // ActionResult represents the result of executing a single action
@@ -294,6 +300,27 @@ type ActionResult struct {
 	Details string
 }
 
+// AppBackup stores a deleted app's complete state for rollback restoration
+type AppBackup struct {
+	// App is the full app object that was deleted
+	App v2.App
+
+	// Region where the app was deployed
+	Region string
+
+	// ManifestContent is the deployment manifest content
+	ManifestContent string
+}
+
+// InstanceBackup stores a deleted instance's complete state for rollback restoration
+type InstanceBackup struct {
+	// Instance is the full instance object that was deleted
+	Instance v2.AppInstance
+
+	// Region where the instance was deployed
+	Region string
+}
+
 // IsEmpty returns true if the deployment plan has no actions to perform
 func (dp *DeploymentPlan) IsEmpty() bool {
 	if dp.AppAction.Type != ActionNone {
diff --git a/sdk/examples/comprehensive/k8s-deployment.yaml b/sdk/examples/comprehensive/k8s-deployment.yaml
index 2a0a741..dff3649 100644
--- a/sdk/examples/comprehensive/k8s-deployment.yaml
+++ b/sdk/examples/comprehensive/k8s-deployment.yaml
@@ -18,6 +18,7 @@ apiVersion: apps/v1
 kind: Deployment
 metadata:
   name: edgeconnect-coder-deployment
+  #namespace: gitea
 spec:
   replicas: 1
   selector: