diff --git a/extensions/openpower-pels/host_notifier.cpp b/extensions/openpower-pels/host_notifier.cpp
index ca30340..2e132b9 100644
--- a/extensions/openpower-pels/host_notifier.cpp
+++ b/extensions/openpower-pels/host_notifier.cpp
@@ -419,4 +419,17 @@
     }
 }
 
+void HostNotifier::setBadPEL(uint32_t id)
+{
+    log<level::ERR>("PEL rejected by the host", entry("PEL_ID=0x%X", id));
+
+    auto sent = std::find(_sentPELs.begin(), _sentPELs.end(), id);
+    if (sent != _sentPELs.end())
+    {
+        _sentPELs.erase(sent);
+    }
+
+    _repo.setPELHostTransState(id, TransmissionState::badPEL);
+}
+
 } // namespace openpower::pels
diff --git a/extensions/openpower-pels/host_notifier.hpp b/extensions/openpower-pels/host_notifier.hpp
index 21bd072..01eac48 100644
--- a/extensions/openpower-pels/host_notifier.hpp
+++ b/extensions/openpower-pels/host_notifier.hpp
@@ -117,6 +117,18 @@
      */
     void setHostFull(uint32_t id);
 
+    /**
+     * @brief Called when the host receives a malformed PEL.
+     *
+     * Ideally this will never happen, as the Repository
+     * class already purges malformed PELs.
+     *
+     * The PEL should never be sent up again.
+     *
+     * @param[in] id - The PEL ID
+     */
+    void setBadPEL(uint32_t id);
+
   private:
     /**
      * @brief This function gets called by the Repository class
diff --git a/test/openpower-pels/host_notifier_test.cpp b/test/openpower-pels/host_notifier_test.cpp
index cd30e8d..9bab030 100644
--- a/test/openpower-pels/host_notifier_test.cpp
+++ b/test/openpower-pels/host_notifier_test.cpp
@@ -746,3 +746,70 @@
     EXPECT_EQ(mockHostIface.numCmdsProcessed(), 5);
     EXPECT_EQ(notifier.queueSize(), 0);
 }
+
+// Test when the host says it was send a malformed PEL
+TEST_F(HostNotifierTest, TestBadPEL)
+{
+    MockDataInterface dataIface;
+    sdeventplus::Event sdEvent{event};
+
+    {
+        Repository repo{repoPath};
+
+        std::unique_ptr<HostInterface> hostIface =
+            std::make_unique<MockHostInterface>(event, dataIface);
+
+        MockHostInterface& mockHostIface =
+            reinterpret_cast<MockHostInterface&>(*hostIface);
+
+        HostNotifier notifier{repo, dataIface, std::move(hostIface)};
+
+        auto send = [&mockHostIface](uint32_t id, uint32_t size) {
+            return mockHostIface.send(0);
+        };
+
+        EXPECT_CALL(mockHostIface, sendNewLogCmd(_, _))
+            .WillRepeatedly(Invoke(send));
+
+        dataIface.changeHostState(true);
+
+        // Add a PEL and dispatch and send it
+        auto pel = makePEL();
+        auto id = pel->id();
+        repo.add(pel);
+
+        runEvents(sdEvent, 2);
+        EXPECT_EQ(mockHostIface.numCmdsProcessed(), 1);
+        EXPECT_EQ(notifier.queueSize(), 0);
+
+        // The host rejected it.
+        notifier.setBadPEL(id);
+
+        // Doesn't go back on the queue
+        EXPECT_EQ(notifier.queueSize(), 0);
+
+        // Check the state was saved in the PEL itself
+        Repository::LogID i{Repository::LogID::Pel{id}};
+        auto data = repo.getPELData(i);
+        PEL pelFromRepo{*data};
+        EXPECT_EQ(pelFromRepo.hostTransmissionState(),
+                  TransmissionState::badPEL);
+
+        dataIface.changeHostState(false);
+
+        // Ensure it doesn't go back on the queue on a power cycle
+        EXPECT_EQ(notifier.queueSize(), 0);
+    }
+
+    // Now restore the repo, and make sure it doesn't come back
+    {
+        Repository repo{repoPath};
+
+        std::unique_ptr<HostInterface> hostIface =
+            std::make_unique<MockHostInterface>(event, dataIface);
+
+        HostNotifier notifier{repo, dataIface, std::move(hostIface)};
+
+        EXPECT_EQ(notifier.queueSize(), 0);
+    }
+}