diff --git a/pkg/controlplane/controller/crdregistration/crdregistration_controller.go b/pkg/controlplane/controller/crdregistration/crdregistration_controller.go
index 8cd7a7c8bb73a..f1410fd30317d 100644
--- a/pkg/controlplane/controller/crdregistration/crdregistration_controller.go
+++ b/pkg/controlplane/controller/crdregistration/crdregistration_controller.go
@@ -198,6 +198,10 @@ func (c *crdRegistrationController) handleVersionUpdate(groupVersion schema.Grou
 	apiServiceName := groupVersion.Version + "." + groupVersion.Group
 
 	if apiserver.APIServiceAlreadyExists(groupVersion) {
+		// Removing APIService from sync means the CRD registration controller won't sync this APIService
+		// anymore. If the APIService is managed externally, this will mean the external component can
+		// update this APIService without CRD controller stomping the changes on it.
+		c.apiServiceRegistration.RemoveAPIServiceToSync(apiServiceName)
 		return nil
 	}