diff --git a/itest/list_on_test.go b/itest/list_on_test.go
index e4dbc32ca..b8d2b09f5 100644
--- a/itest/list_on_test.go
+++ b/itest/list_on_test.go
@@ -755,6 +755,9 @@ func init() {
 	allTestCases = appendPrefixed(
 		"channel force close", allTestCases, channelForceCloseTestCases,
 	)
+	allTestCases = appendPrefixed(
+		"wallet", allTestCases, walletTestCases,
+	)
 
 	// Prepare the test cases for windows to exclude some of the flaky
 	// ones.
diff --git a/itest/lnd_wallet.go b/itest/lnd_wallet.go
new file mode 100644
index 000000000..1c07b087b
--- /dev/null
+++ b/itest/lnd_wallet.go
@@ -0,0 +1,120 @@
+package itest
+
+import (
+	"github.com/btcsuite/btcd/btcutil"
+	"github.com/btcsuite/btcd/wire"
+	"github.com/lightningnetwork/lnd/lntest"
+	"github.com/lightningnetwork/lnd/lntest/node"
+	"github.com/lightningnetwork/lnd/lnwallet"
+	"github.com/stretchr/testify/require"
+)
+
+// walletTestCases defines a set of tests aiming at asserting functionalities
+// provided by the wallerpc.
+var walletTestCases = []*lntest.TestCase{
+	{
+		Name: "listunspent P2WPKH",
+		TestFunc: func(ht *lntest.HarnessTest) {
+			runTestListUnspent(ht, ht.FundCoins)
+		},
+	},
+	{
+		Name: "listunspent NP2WPKH",
+		TestFunc: func(ht *lntest.HarnessTest) {
+			runTestListUnspent(ht, ht.FundCoinsNP2WKH)
+		},
+	},
+	{
+		Name: "listunspent P2TR",
+		TestFunc: func(ht *lntest.HarnessTest) {
+			runTestListUnspent(ht, ht.FundCoinsP2TR)
+		},
+	},
+	{
+		Name: "listunspent P2WPKH restart",
+		TestFunc: func(ht *lntest.HarnessTest) {
+			runTestListUnspentRestart(ht, ht.FundCoins)
+		},
+	},
+	{
+		Name: "listunspent NP2WPKH restart",
+		TestFunc: func(ht *lntest.HarnessTest) {
+			runTestListUnspentRestart(ht, ht.FundCoinsNP2WKH)
+		},
+	},
+	{
+		Name: "listunspent P2TR restart",
+		TestFunc: func(ht *lntest.HarnessTest) {
+			runTestListUnspentRestart(ht, ht.FundCoinsP2TR)
+		},
+	},
+}
+
+type fundMethod func(amt btcutil.Amount, hn *node.HarnessNode) *wire.MsgTx
+
+// testListUnspent checks that once Alice sends all coins to Bob, her wallet
+// balances are updated and the ListUnspent returns no UTXO.
+func runTestListUnspent(ht *lntest.HarnessTest, fundCoins fundMethod) {
+	// Create two test nodes.
+	alice := ht.NewNode("Alice", nil)
+	bob := ht.NewNode("Bob", nil)
+
+	// Fund Alice one UTXO.
+	coin := btcutil.Amount(100_000)
+	fundCoins(coin, alice)
+
+	// Log Alice's wallet balance for debug.
+	balance := alice.RPC.WalletBalance()
+	ht.Logf("Alice has balance: %v", balance)
+
+	// Send all Alice's balance to Bob.
+	ht.SendAllCoins(alice, bob)
+
+	// Mine Alice's send coin tx.
+	ht.MineBlocksAndAssertNumTxes(1, 1)
+
+	// Alice wallet should be empty now, assert that all her balance fields
+	// are zero.
+	ht.AssertWalletAccountBalance(alice, lnwallet.DefaultAccountName, 0, 0)
+	ht.AssertWalletLockedBalance(alice, 0)
+
+	// Alice should have no UTXO.
+	ht.AssertNumUTXOs(alice, 0)
+}
+
+// testListUnspentRestart checks that once Alice sends all coins to Bob, then
+// restarts, her wallet balances are updated and the ListUnspent returns no
+// UTXO.
+func runTestListUnspentRestart(ht *lntest.HarnessTest, fundCoins fundMethod) {
+	// Create two test nodes.
+	alice := ht.NewNode("Alice", nil)
+	bob := ht.NewNode("Bob", nil)
+
+	// Fund Alice one UTXO.
+	coin := btcutil.Amount(100_000)
+	fundCoins(coin, alice)
+
+	// Log Alice's wallet balance for debug.
+	balance := alice.RPC.WalletBalance()
+	ht.Logf("Alice has balance: %v", balance)
+
+	// Send all Alice's balance to Bob.
+	ht.SendAllCoins(alice, bob)
+
+	// Shutdown Alice.
+	restart := ht.SuspendNode(alice)
+
+	// Mine Alice's send coin tx.
+	ht.MineBlocksAndAssertNumTxes(1, 1)
+
+	// Restart Alice.
+	require.NoError(ht, restart())
+
+	// Alice wallet should be empty now, assert that all her balance fields
+	// are zero.
+	ht.AssertWalletAccountBalance(alice, lnwallet.DefaultAccountName, 0, 0)
+	ht.AssertWalletLockedBalance(alice, 0)
+
+	// Alice should have no UTXO.
+	ht.AssertNumUTXOs(alice, 0)
+}