diff --git a/tests/subsys/fs/ext2/src/testfs_ext_specific.c b/tests/subsys/fs/ext2/src/testfs_ext_specific.c
index 63367d7272..47863a987a 100644
--- a/tests/subsys/fs/ext2/src/testfs_ext_specific.c
+++ b/tests/subsys/fs/ext2/src/testfs_ext_specific.c
@@ -39,41 +39,17 @@ uint32_t calculate_blocks(uint32_t freeb, uint32_t B)
 	/* TODO: revisit this and extend when 3rd level blocks will be possible */
 }
 
-void writing_test(struct ext2_cfg *config)
+static void write_to_file(const char *file_path, uint32_t bytes_to_write)
 {
 	int64_t ret = 0;
 	struct fs_file_t file;
-	struct fs_statvfs sbuf;
 	struct fs_dirent entry;
-	struct fs_mount_t *mp = &testfs_mnt;
-	static const char *file_path = "/sml/file";
-
-	ret = fs_mkfs(FS_EXT2, (uintptr_t)mp->storage_dev, config, 0);
-	zassert_equal(ret, 0, "Failed to mkfs with 2K blocks");
-
-	mp->flags = FS_MOUNT_FLAG_NO_FORMAT;
-	ret = fs_mount(mp);
-	zassert_equal(ret, 0, "Mount failed (ret=%d)", ret);
 
 	fs_file_t_init(&file);
 	ret = fs_open(&file, file_path, FS_O_RDWR | FS_O_CREATE);
 	zassert_equal(ret, 0, "File open failed (ret=%d)", ret);
 
-	ret = fs_statvfs(mp->mnt_point, &sbuf);
-	zassert_equal(ret, 0, "Expected success (ret=%d)", ret);
-
-
-	/* Calculate how many numbers will be written (use all available memory) */
-	uint32_t freeb = sbuf.f_bfree;
-	uint32_t bsize = sbuf.f_bsize;
-	uint32_t available_blocks = calculate_blocks(freeb, bsize / sizeof(uint32_t));
-
-	uint32_t bytes_to_write = bsize * available_blocks;
-
-	TC_PRINT("Available blocks: %d\nBlock size: %d\nBytes_to_write: %d\n",
-			available_blocks, bsize, bytes_to_write);
-
-	ret = testfs_write_incrementing(&file, 0, available_blocks * bsize);
+	ret = testfs_write_incrementing(&file, 0, bytes_to_write);
 	zassert_equal(ret, bytes_to_write, "Different number of bytes written %ld (expected %ld)",
 			ret, bytes_to_write);
 
@@ -93,40 +69,121 @@ void writing_test(struct ext2_cfg *config)
 	zassert_equal(ret, 0, "File open failed (ret=%d)", ret);
 
 
-	ret = testfs_verify_incrementing(&file, 0, available_blocks * bsize);
+	ret = testfs_verify_incrementing(&file, 0, bytes_to_write);
 	zassert_equal(ret, bytes_to_write, "Different number of bytes read %ld (expected %ld)",
 			ret, bytes_to_write);
 
 	ret = fs_close(&file);
 	zassert_equal(ret, 0, "File close failed (ret=%d)", ret);
+}
+
+static void truncate_file(const char *file_path, uint32_t new_size)
+{
+	int64_t ret = 0;
+	struct fs_file_t file;
+	struct fs_dirent entry;
+
+	fs_file_t_init(&file);
+
+	TC_PRINT("Truncating to %d\n", new_size);
+
+	ret = fs_open(&file, file_path, FS_O_RDWR);
+	zassert_equal(ret, 0, "File open failed (ret=%d)", ret);
+
+	ret = fs_truncate(&file, new_size);
+	zassert_equal(ret, 0, "File truncate failed (ret=%d)", ret);
+
+	ret = fs_stat(file_path, &entry);
+	zassert_equal(ret, 0, "File stat failed (ret=%d)", ret);
+	zassert_equal(entry.size, new_size,
+			"Wrong file size %d (expected %d)", entry.size, new_size);
+
+	ret = fs_seek(&file, 0, FS_SEEK_SET);
+	zassert_equal(ret, 0, "File seek failed (ret=%d)", ret);
+
+	ret = testfs_verify_incrementing(&file, 0, new_size);
+	zassert_equal(ret, new_size, "Different number of bytes read %ld (expected %ld)",
+			ret, new_size);
+
+	ret = fs_close(&file);
+	zassert_equal(ret, 0, "File close failed (ret=%d)", ret);
+}
+
+void writing_test(struct ext2_cfg *config)
+{
+	int64_t ret = 0;
+	struct fs_statvfs sbuf;
+	struct fs_mount_t *mp = &testfs_mnt;
+	static const char *file_path = "/sml/file";
+
+	ret = fs_mkfs(FS_EXT2, (uintptr_t)mp->storage_dev, config, 0);
+	zassert_equal(ret, 0, "Failed to mkfs with 2K blocks");
+
+	mp->flags = FS_MOUNT_FLAG_NO_FORMAT;
+	ret = fs_mount(mp);
+	zassert_equal(ret, 0, "Mount failed (ret=%d)", ret);
+
+	ret = fs_statvfs(mp->mnt_point, &sbuf);
+	zassert_equal(ret, 0, "Expected success (ret=%d)", ret);
+
+	/* Calculate how many numbers will be written (use all available memory) */
+	uint32_t freeb = sbuf.f_bfree;
+	uint32_t bsize = sbuf.f_bsize;
+	uint32_t available_blocks = calculate_blocks(freeb, bsize / sizeof(uint32_t));
+
+	uint32_t bytes_to_write = bsize * available_blocks;
+
+	TC_PRINT("Available blocks: %d\nBlock size: %d\nBytes_to_write: %d\n",
+			available_blocks, bsize, bytes_to_write);
+
+	write_to_file(file_path, bytes_to_write);
 
 	uint32_t new_size = bytes_to_write;
 
 	while (new_size > 1) {
 		new_size = new_size / 8 * 3;
+		truncate_file(file_path, new_size);
+	}
 
-		TC_PRINT("Truncating to %d\n", new_size);
+	ret = fs_unmount(mp);
+	zassert_equal(ret, 0, "Unmount failed (ret=%d)", ret);
+}
 
-		ret = fs_open(&file, file_path, FS_O_RDWR);
-		zassert_equal(ret, 0, "File open failed (ret=%d)", ret);
+ZTEST(ext2tests, test_indirect_block_removal)
+{
+	int64_t ret = 0;
+	struct fs_statvfs sbuf;
+	struct fs_mount_t *mp = &testfs_mnt;
+	static const char *file_path = "/sml/file";
 
-		ret = fs_truncate(&file, new_size);
-		zassert_equal(ret, 0, "File truncate failed (ret=%d)", ret);
+	ret = fs_mkfs(FS_EXT2, (uintptr_t)mp->storage_dev, NULL, 0);
+	zassert_equal(ret, 0, "Failed to mkfs with 2K blocks");
 
-		ret = fs_stat(file_path, &entry);
-		zassert_equal(ret, 0, "File stat failed (ret=%d)", ret);
-		zassert_equal(entry.size, new_size,
-				"Wrong file size %d (expected %d)", entry.size, new_size);
+	mp->flags = FS_MOUNT_FLAG_NO_FORMAT;
+	ret = fs_mount(mp);
+	zassert_equal(ret, 0, "Mount failed (ret=%d)", ret);
 
-		ret = fs_seek(&file, 0, FS_SEEK_SET);
-		zassert_equal(ret, 0, "File seek failed (ret=%d)", ret);
+	ret = fs_statvfs(mp->mnt_point, &sbuf);
+	zassert_equal(ret, 0, "Expected success (ret=%d)", ret);
 
-		ret = testfs_verify_incrementing(&file, 0, new_size);
-		zassert_equal(ret, new_size, "Different number of bytes read %ld (expected %ld)",
-				ret, new_size);
+	uint32_t bsize = sbuf.f_bsize;
 
-		ret = fs_close(&file);
-		zassert_equal(ret, 0, "File close failed (ret=%d)", ret);
+	uint32_t bytes_to_write = bsize * 13;
+
+	TC_PRINT("Block size: %d\nBytes_to_write: %d\n", bsize, bytes_to_write);
+
+	write_to_file(file_path, bytes_to_write);
+
+	/* First truncate will remove all blocks under first indirect block.
+	 * Second truncate will remove rest of blocks;
+	 * it will check if first indirect block was removed properly.
+	 */
+	uint32_t sizes[] = {12 * bsize, 0};
+
+	for (int i = 0; i < ARRAY_SIZE(sizes); i++) {
+		uint32_t new_size = sizes[i];
+
+		truncate_file(file_path, new_size);
 	}
 
 	ret = fs_unmount(mp);