diff --git a/subsys/bluetooth/host/hci_core.c b/subsys/bluetooth/host/hci_core.c
index 180c5f7a4e0..46cb4254313 100644
--- a/subsys/bluetooth/host/hci_core.c
+++ b/subsys/bluetooth/host/hci_core.c
@@ -4310,7 +4310,14 @@ k_tid_t bt_testing_tx_tid_get(void)
 	/* We now TX everything from the syswq */
 	return &k_sys_work_q.thread;
 }
-#endif
+
+#if defined(CONFIG_BT_ISO)
+void bt_testing_set_iso_mtu(uint16_t mtu)
+{
+	bt_dev.le.iso_mtu = mtu;
+}
+#endif /* CONFIG_BT_ISO */
+#endif /* CONFIG_BT_TESTING */
 
 int bt_enable(bt_ready_cb_t cb)
 {
diff --git a/tests/bsim/bluetooth/host/compile.sh b/tests/bsim/bluetooth/host/compile.sh
index 6c6348aa030..dfb637078c1 100755
--- a/tests/bsim/bluetooth/host/compile.sh
+++ b/tests/bsim/bluetooth/host/compile.sh
@@ -21,6 +21,7 @@ ${ZEPHYR_BASE}/tests/bsim/bluetooth/host/security/compile.sh
 app=tests/bsim/bluetooth/host/iso/cis compile
 app=tests/bsim/bluetooth/host/iso/bis compile
 app=tests/bsim/bluetooth/host/iso/frag compile
+app=tests/bsim/bluetooth/host/iso/frag_2 compile
 
 app=tests/bsim/bluetooth/host/misc/disable compile
 run_in_background ${ZEPHYR_BASE}/tests/bsim/bluetooth/host/misc/disconnect/compile.sh
diff --git a/tests/bsim/bluetooth/host/iso/frag_2/CMakeLists.txt b/tests/bsim/bluetooth/host/iso/frag_2/CMakeLists.txt
new file mode 100644
index 00000000000..9fa69bf40c7
--- /dev/null
+++ b/tests/bsim/bluetooth/host/iso/frag_2/CMakeLists.txt
@@ -0,0 +1,22 @@
+# SPDX-License-Identifier: Apache-2.0
+
+cmake_minimum_required(VERSION 3.20.0)
+
+find_package(Zephyr REQUIRED HINTS $ENV{ZEPHYR_BASE})
+
+project(bsim_test_iso_frag_2)
+
+add_subdirectory(${ZEPHYR_BASE}/tests/bsim/babblekit babblekit)
+target_link_libraries(app PRIVATE babblekit)
+
+target_sources(app PRIVATE
+  src/broadcaster.c
+  src/main.c
+)
+
+zephyr_include_directories(
+  ${BSIM_COMPONENTS_PATH}/libUtilv1/src/
+  ${BSIM_COMPONENTS_PATH}/libPhyComv1/src/
+)
+
+target_link_options(app PUBLIC -Wl,--wrap=bt_send)
diff --git a/tests/bsim/bluetooth/host/iso/frag_2/prj.conf b/tests/bsim/bluetooth/host/iso/frag_2/prj.conf
new file mode 100644
index 00000000000..4ae63917a5d
--- /dev/null
+++ b/tests/bsim/bluetooth/host/iso/frag_2/prj.conf
@@ -0,0 +1,33 @@
+CONFIG_LOG=y
+CONFIG_BT_ISO_LOG_LEVEL_DBG=y
+# CONFIG_BT_CONN_LOG_LEVEL_DBG=y
+
+CONFIG_ASSERT=y
+CONFIG_BT_TESTING=y
+CONFIG_ARCH_POSIX_TRAP_ON_FATAL=y
+
+CONFIG_BT=y
+CONFIG_BT_DEVICE_NAME="ISO frag test 2"
+
+CONFIG_BT_EXT_ADV=y
+CONFIG_BT_PER_ADV=y
+CONFIG_BT_PER_ADV_SYNC=y
+
+CONFIG_BT_ISO_BROADCASTER=y
+CONFIG_BT_ISO_TX_BUF_COUNT=2
+CONFIG_BT_ISO_MAX_CHAN=2
+CONFIG_BT_ISO_TX_MTU=100
+CONFIG_BT_ISO_RX_MTU=100
+
+# Controller ISO configs
+CONFIG_BT_CTLR_ADV_ISO=y
+CONFIG_BT_CTLR_ISO_TX_BUFFER_SIZE=255
+CONFIG_BT_CTLR_ISO_TX_BUFFERS=10
+
+# Controller Extended Advertising configs
+CONFIG_BT_CTLR_ADV_EXT=y
+CONFIG_BT_CTLR_ADV_DATA_LEN_MAX=191
+
+# ISO Broadcaster Controller
+CONFIG_BT_CTLR_ADV_PERIODIC=y
+CONFIG_BT_CTLR_ADV_ISO_PDU_LEN_MAX=247
diff --git a/tests/bsim/bluetooth/host/iso/frag_2/src/broadcaster.c b/tests/bsim/bluetooth/host/iso/frag_2/src/broadcaster.c
new file mode 100644
index 00000000000..6b70c3fd056
--- /dev/null
+++ b/tests/bsim/bluetooth/host/iso/frag_2/src/broadcaster.c
@@ -0,0 +1,277 @@
+/*
+ * Copyright (c) 2024 Nordic Semiconductor
+ *
+ * SPDX-License-Identifier: Apache-2.0
+ */
+
+#include <zephyr/sys/byteorder.h>
+#include <zephyr/bluetooth/bluetooth.h>
+#include <zephyr/bluetooth/iso.h>
+#include <zephyr/logging/log.h>
+#include <zephyr/sys/byteorder.h>
+
+#include "babblekit/flags.h"
+#include "babblekit/testcase.h"
+
+LOG_MODULE_REGISTER(broadcaster, LOG_LEVEL_INF);
+
+static struct bt_iso_chan iso_chans[CONFIG_BT_ISO_MAX_CHAN];
+static struct bt_iso_chan *default_chan = &iso_chans[0];
+
+NET_BUF_POOL_FIXED_DEFINE(tx_pool, CONFIG_BT_ISO_TX_BUF_COUNT,
+			  BT_ISO_SDU_BUF_SIZE(CONFIG_BT_ISO_TX_MTU),
+			  CONFIG_BT_CONN_TX_USER_DATA_SIZE, NULL);
+
+static DEFINE_FLAG(iso_connected);
+static DEFINE_FLAG(first_frag);
+static DEFINE_FLAG(sdu_sent);
+
+extern void bt_conn_suspend_tx(bool suspend);
+extern void bt_testing_set_iso_mtu(uint16_t mtu);
+
+static int send_data(struct bt_iso_chan *chan)
+{
+	static uint16_t seq;
+	struct net_buf *buf;
+	int err;
+
+	if (!IS_FLAG_SET(iso_connected)) {
+		/* TX has been aborted */
+		return -ENOTCONN;
+	}
+
+	buf = net_buf_alloc(&tx_pool, K_NO_WAIT);
+	TEST_ASSERT(buf != NULL, "Failed to allocate buffer");
+
+	net_buf_reserve(buf, BT_ISO_CHAN_SEND_RESERVE);
+
+	net_buf_add(buf, 40);
+
+	LOG_INF("Sending SDU (headroom %d)", net_buf_headroom(buf));
+	LOG_HEXDUMP_INF(buf->data, buf->len, "SDU payload");
+
+	err = bt_iso_chan_send(default_chan, buf, seq++);
+
+	return err;
+}
+
+static void iso_connected_cb(struct bt_iso_chan *chan)
+{
+	LOG_INF("ISO Channel %p connected", chan);
+
+	SET_FLAG(iso_connected);
+}
+
+static void iso_disconnected_cb(struct bt_iso_chan *chan, uint8_t reason)
+{
+	LOG_INF("ISO Channel %p disconnected (reason 0x%02x)", chan, reason);
+
+	UNSET_FLAG(iso_connected);
+}
+
+static void sdu_sent_cb(struct bt_iso_chan *chan)
+{
+	SET_FLAG(sdu_sent);
+}
+
+static void create_ext_adv(struct bt_le_ext_adv **adv)
+{
+	int err;
+
+	LOG_INF("Creating extended advertising set with periodic advertising");
+
+	/* Create a non-connectable advertising set */
+	err = bt_le_ext_adv_create(BT_LE_EXT_ADV_NCONN, NULL, adv);
+	TEST_ASSERT(err == 0, "Unable to create extended advertising set: %d", err);
+
+	/* Set periodic advertising parameters */
+	err = bt_le_per_adv_set_param(*adv, BT_LE_PER_ADV_PARAM(BT_GAP_PER_ADV_FAST_INT_MIN_2,
+								BT_GAP_PER_ADV_FAST_INT_MAX_2,
+								BT_LE_PER_ADV_OPT_NONE));
+	TEST_ASSERT(err == 0, "Failed to set periodic advertising parameters: %d", err);
+}
+
+static void start_ext_adv(struct bt_le_ext_adv *adv)
+{
+	int err;
+
+	LOG_INF("Starting extended and periodic advertising");
+
+	/* Start extended advertising */
+	err = bt_le_ext_adv_start(adv, BT_LE_EXT_ADV_START_DEFAULT);
+	TEST_ASSERT(err == 0, "Failed to start extended advertising: %d", err);
+
+	/* FIXME: Temporary workaround to get around an assert in the controller
+	 * Open issue: https://github.com/zephyrproject-rtos/zephyr/issues/72852
+	 */
+	k_sleep(K_MSEC(100));
+
+	/* Enable Periodic Advertising */
+	err = bt_le_per_adv_start(adv);
+	TEST_ASSERT(err == 0, "Failed to enable periodic advertising: %d", err);
+}
+
+static void create_big(struct bt_le_ext_adv *adv, size_t cnt, struct bt_iso_big **out_big)
+{
+	const uint16_t latency_ms = 10U;
+	const uint16_t sdu_interval_us = 10U * USEC_PER_MSEC;
+
+	struct bt_iso_chan *channels[ARRAY_SIZE(iso_chans)];
+	struct bt_iso_big_create_param param = {
+		.packing = BT_ISO_PACKING_SEQUENTIAL,
+		.framing = BT_ISO_FRAMING_UNFRAMED,
+		.interval = sdu_interval_us,
+		.bis_channels = channels,
+		.latency = latency_ms,
+		.encryption = false,
+		.num_bis = cnt,
+	};
+	int err;
+
+	for (size_t i = 0U; i < cnt; i++) {
+		channels[i] = &iso_chans[i];
+	}
+
+	LOG_INF("Creating BIG");
+
+	err = bt_iso_big_create(adv, &param, out_big);
+	TEST_ASSERT(err == 0, "Failed to create BIG: %d", err);
+
+	WAIT_FOR_FLAG(iso_connected);
+}
+
+struct bt_le_ext_adv *adv;
+struct bt_iso_big *big;
+
+static struct bt_iso_chan_ops iso_ops = {
+	.disconnected = iso_disconnected_cb,
+	.connected = iso_connected_cb,
+	.sent = sdu_sent_cb,
+};
+static struct bt_iso_chan_io_qos iso_tx = {
+	.sdu = CONFIG_BT_ISO_TX_MTU,
+	.phy = BT_GAP_LE_PHY_2M,
+	.rtn = 1,
+	.path = NULL,
+};
+static struct bt_iso_chan_qos iso_qos = {
+	.tx = &iso_tx,
+	.rx = NULL,
+};
+
+static void init(void)
+{
+	int err;
+
+	err = bt_enable(NULL);
+	TEST_ASSERT(err == 0, "Bluetooth enable failed: %d", err);
+}
+
+static void connect_iso(void)
+{
+	bt_testing_set_iso_mtu(10);
+
+	for (size_t i = 0U; i < ARRAY_SIZE(iso_chans); i++) {
+		iso_chans[i].ops = &iso_ops;
+		iso_chans[i].qos = &iso_qos;
+	}
+
+	create_ext_adv(&adv);
+	create_big(adv, 1U, &big);
+	start_ext_adv(adv);
+}
+
+static void disconnect_iso(void)
+{
+	int err;
+
+	err = bt_iso_big_terminate(big);
+	TEST_ASSERT(err == 0, "bt_iso_big_terminate failed (%d)", err);
+	err = bt_le_per_adv_stop(adv);
+	TEST_ASSERT(err == 0, "bt_le_per_adv_stop failed (%d)", err);
+	k_msleep(100);
+	err = bt_le_ext_adv_stop(adv);
+	TEST_ASSERT(err == 0, "bt_le_ext_adv_stop failed (%d)", err);
+	k_msleep(100);
+	err = bt_le_ext_adv_delete(adv);
+	TEST_ASSERT(err == 0, "bt_le_ext_adv_delete failed (%d)", err);
+
+	big = NULL;
+	adv = NULL;
+}
+
+void entrypoint_broadcaster(void)
+{
+	/* Test purpose:
+	 *
+	 * Verifies that we are not leaking buffers when getting disconnected
+	 * while sending fragmented ISO SDU.
+	 *
+	 * One device:
+	 * - `broadcaster`: sends fragmented ISO SDUs
+	 *
+	 * Procedure:
+	 * - initialize Bluetooth and a BIS
+	 * - send a fragmented SDU
+	 * - disconnect when the first fragment is sent
+	 * - repeat TEST_ITERATIONS time
+	 *
+	 * [verdict]
+	 * - no buffer is leaked and repeating the operation success
+	 */
+	int err;
+	uint8_t TEST_ITERATIONS = 4;
+
+	LOG_INF("Starting ISO HCI fragmentation test 2");
+
+	init();
+
+	for (size_t i = 0; i < TEST_ITERATIONS; i++) {
+		connect_iso();
+
+		/* Send an SDU */
+		err = send_data(default_chan);
+		TEST_ASSERT(!err, "Failed to send data w/o TS (err %d)", err);
+
+		/* Wait until we have sent the first SDU fragment. */
+		WAIT_FOR_FLAG(first_frag);
+
+		disconnect_iso();
+		bt_conn_suspend_tx(false);
+
+		k_msleep(1000);
+	}
+
+	TEST_PASS_AND_EXIT("Test passed");
+}
+
+void validate_no_iso_frag(struct net_buf *buf)
+{
+	struct bt_hci_iso_hdr *hci_hdr = (void *)buf->data;
+
+	uint16_t handle = sys_le16_to_cpu(hci_hdr->handle);
+	uint8_t flags = bt_iso_flags(handle);
+	uint8_t pb_flag = bt_iso_flags_pb(flags);
+
+	TEST_ASSERT(pb_flag == BT_ISO_SINGLE, "Packet was fragmented");
+}
+
+int __real_bt_send(struct net_buf *buf);
+
+int __wrap_bt_send(struct net_buf *buf)
+{
+	struct bt_hci_iso_hdr *hci_hdr = (void *)buf->data;
+
+	if (bt_buf_get_type(buf) == BT_BUF_ISO_OUT) {
+		uint16_t handle = sys_le16_to_cpu(hci_hdr->handle);
+		uint8_t flags = bt_iso_flags(handle);
+		uint8_t pb_flag = bt_iso_flags_pb(flags);
+
+		if (pb_flag == BT_ISO_START) {
+			SET_FLAG(first_frag);
+			bt_conn_suspend_tx(true);
+		}
+	}
+
+	return __real_bt_send(buf);
+}
diff --git a/tests/bsim/bluetooth/host/iso/frag_2/src/main.c b/tests/bsim/bluetooth/host/iso/frag_2/src/main.c
new file mode 100644
index 00000000000..e87fbbbdba2
--- /dev/null
+++ b/tests/bsim/bluetooth/host/iso/frag_2/src/main.c
@@ -0,0 +1,45 @@
+/*
+ * Copyright (c) 2024 Nordic Semiconductor ASA
+ *
+ * SPDX-License-Identifier: Apache-2.0
+ */
+
+#include <zephyr/kernel.h>
+
+#include "bs_tracing.h"
+#include "bstests.h"
+#include "babblekit/testcase.h"
+
+extern void entrypoint_broadcaster(void);
+extern enum bst_result_t bst_result;
+
+
+static void test_end_cb(void)
+{
+	if (bst_result != Passed) {
+		TEST_PRINT("Test has not passed.");
+	}
+}
+
+static const struct bst_test_instance entrypoints[] = {
+	{
+		.test_id = "broadcaster",
+		.test_delete_f = test_end_cb,
+		.test_main_f = entrypoint_broadcaster,
+	},
+	BSTEST_END_MARKER,
+};
+
+static struct bst_test_list *install(struct bst_test_list *tests)
+{
+	return bst_add_tests(tests, entrypoints);
+};
+
+bst_test_install_t test_installers[] = {install, NULL};
+
+int main(void)
+{
+	bst_main();
+
+	return 0;
+}
diff --git a/tests/bsim/bluetooth/host/iso/frag_2/tests_scripts/_compile.sh b/tests/bsim/bluetooth/host/iso/frag_2/tests_scripts/_compile.sh
new file mode 100755
index 00000000000..f46c09eab66
--- /dev/null
+++ b/tests/bsim/bluetooth/host/iso/frag_2/tests_scripts/_compile.sh
@@ -0,0 +1,13 @@
+#!/usr/bin/env bash
+# Copyright 2024 Nordic Semiconductor ASA
+# SPDX-License-Identifier: Apache-2.0
+set -eu
+: "${ZEPHYR_BASE:?ZEPHYR_BASE must be defined}"
+
+INCR_BUILD=1
+
+source ${ZEPHYR_BASE}/tests/bsim/compile.source
+
+app="$(guess_test_relpath)" compile
+
+wait_for_background_jobs
diff --git a/tests/bsim/bluetooth/host/iso/frag_2/tests_scripts/bis.sh b/tests/bsim/bluetooth/host/iso/frag_2/tests_scripts/bis.sh
new file mode 100755
index 00000000000..c6307d33027
--- /dev/null
+++ b/tests/bsim/bluetooth/host/iso/frag_2/tests_scripts/bis.sh
@@ -0,0 +1,18 @@
+#!/usr/bin/env bash
+# Copyright (c) 2024 Nordic Semiconductor
+# SPDX-License-Identifier: Apache-2.0
+
+source ${ZEPHYR_BASE}/tests/bsim/sh_common.source
+
+simulation_id="iso_frag_2"
+verbosity_level=2
+
+cd ${BSIM_OUT_PATH}/bin
+
+Execute ./bs_2G4_phy_v1 -v=${verbosity_level} -s=${simulation_id} \
+    -D=1 -sim_length=30e6 $@
+
+Execute ./bs_${BOARD_TS}_tests_bsim_bluetooth_host_iso_frag_2_prj_conf \
+    -v=${verbosity_level} -s=${simulation_id} -d=0 -testid=broadcaster
+
+wait_for_background_jobs