diff --git a/homeassistant/components/caldav/coordinator.py b/homeassistant/components/caldav/coordinator.py
index e2ad8e1abad6..a1de80ec3e25 100644
--- a/homeassistant/components/caldav/coordinator.py
+++ b/homeassistant/components/caldav/coordinator.py
@@ -31,11 +31,9 @@ OFFSET = "!!"
 def _get_status(vevent: CalendarObjectResource) -> CalendarEventStatus | None:
     """Return the rfc5545 STATUS of a VEVENT, if a calendar entity reports it.
 
-    Anything outside the supported set is dropped rather than passed on, which
-    covers both the cancelled status a calendar entity does not report and the
-    iana-tokens and x-names that rfc5545 also permits here: reporting no status
-    at all is closer to the truth than reporting one the consumer cannot
-    interpret.
+    Cancelled events never reach this, they are filtered out before an event is
+    built. Anything else outside the supported set is dropped: rfc5545 also
+    permits iana-tokens and x-names here, which a consumer cannot interpret.
     """
     if (value := get_attr_value(vevent, "status")) is None:
         return None
@@ -46,6 +44,17 @@ def _get_status(vevent: CalendarObjectResource) -> CalendarEventStatus | None:
         return None
 
 
+def _is_cancelled(vevent: CalendarObjectResource) -> bool:
+    """Return whether a VEVENT has been called off.
+
+    rfc5545 keeps a cancelled event in the calendar rather than deleting it, so
+    a calendar has to be read to find out. A calendar entity does not return
+    such events.
+    """
+    value = get_attr_value(vevent, "status")
+    return value is not None and value.lower() == "cancelled"
+
+
 class CalDavUpdateCoordinator(DataUpdateCoordinator[CalendarEvent | None]):
     """Class to utilize the calendar dav client object to get next event."""
 
@@ -101,6 +110,8 @@ class CalDavUpdateCoordinator(DataUpdateCoordinator[CalendarEvent | None]):
             vevent = event.vobject_instance.vevent
             if not self.is_matching(vevent, self.search):
                 continue
+            if _is_cancelled(vevent):
+                continue
             event_list.append(
                 CalendarEvent(
                     summary=get_attr_value(vevent, "summary") or "",
@@ -196,6 +207,7 @@ class CalDavUpdateCoordinator(DataUpdateCoordinator[CalendarEvent | None]):
                     self.is_matching(vevent, self.search)
                     and (not self.is_all_day(vevent) or self.include_all_day)
                     and not self.is_over(vevent)
+                    and not _is_cancelled(vevent)
                 )
             ),
             None,
diff --git a/tests/components/caldav/test_calendar.py b/tests/components/caldav/test_calendar.py
index 1f6b26367842..ab1fcd1cd3f4 100644
--- a/tests/components/caldav/test_calendar.py
+++ b/tests/components/caldav/test_calendar.py
@@ -1174,7 +1174,6 @@ END:VCALENDAR"""
         pytest.param("TENTATIVE", "tentative", id="tentative"),
         pytest.param("CONFIRMED", "confirmed", id="confirmed"),
         pytest.param("Tentative", "tentative", id="mixed_case"),
-        pytest.param("CANCELLED", None, id="cancelled_is_not_reported"),
         pytest.param("X-VENDOR-SPECIFIC", None, id="unsupported_value"),
     ],
 )
@@ -1193,6 +1192,54 @@ async def test_get_events_with_status(
     assert events[0]["status"] == expected_status
 
 
+def _mock_calendar_holding(name: str, vevents: list[str]) -> Mock:
+    """Return a mock calendar holding exactly the given VEVENTs."""
+    calendar = _mock_calendar(name)
+    calendar.search = MagicMock(
+        return_value=[
+            Event(None, f"{idx}.ics", vevent, calendar, str(idx))
+            for idx, vevent in enumerate(vevents)
+        ]
+    )
+    return calendar
+
+
+async def test_cancelled_event_is_not_returned(
+    hass: HomeAssistant,
+    hass_client: ClientSessionGenerator,
+) -> None:
+    """Test that an event called off is not returned by the API."""
+    events = await _get_api_events_for_vevent(
+        hass,
+        hass_client,
+        ICS_WITH_STATUS.format(status="CANCELLED"),
+        "status-event-uid",
+    )
+
+    assert events == []
+
+
+@pytest.mark.parametrize("tz", [UTC])
+@pytest.mark.parametrize(
+    ("calendars"),
+    [[_mock_calendar_holding("Example", [ICS_WITH_STATUS.format(status="CANCELLED")])]],
+)
+@pytest.mark.freeze_time(_local_datetime(17, 30))
+async def test_cancelled_event_is_not_the_ongoing_event(
+    hass: HomeAssistant, setup_platform_cb: Callable[[], Awaitable[None]]
+) -> None:
+    """Test that an event called off does not turn the entity on.
+
+    The event would be ongoing at this time were it not cancelled, so this
+    covers the state path rather than the API one.
+    """
+    await setup_platform_cb()
+
+    state = hass.states.get(TEST_ENTITY)
+    assert state
+    assert state.state == STATE_OFF
+
+
 @pytest.mark.parametrize(
     ("calendars"),
     [