diff --git a/config/samples/kustomization.yaml b/config/samples/kustomization.yaml
index 438fa77..5977452 100644
--- a/config/samples/kustomization.yaml
+++ b/config/samples/kustomization.yaml
@@ -1,4 +1,4 @@
 ## Append samples of your project ##
 resources:
-- fluxcd_v1alpha1_fluxinstance.yaml
+- fluxcd_v1_fluxinstance.yaml
 # +kubebuilder:scaffold:manifestskustomizesamples
diff --git a/internal/builder/semver.go b/internal/builder/semver.go
index 667cc48..78cecc5 100644
--- a/internal/builder/semver.go
+++ b/internal/builder/semver.go
@@ -8,10 +8,37 @@ import (
 	"os"
 	"path/filepath"
 	"sort"
+	"strings"
 
 	"github.com/Masterminds/semver/v3"
 )
 
+// IsCompatibleVersion checks if the version upgrade is compatible.
+// It returns an error if a downgrade to a lower minor version is attempted.
+func IsCompatibleVersion(fromVer, toVer string) error {
+	if strings.Contains(fromVer, "@") {
+		fromVer = strings.Split(fromVer, "@")[0]
+	}
+	from, err := semver.NewVersion(fromVer)
+	if err != nil {
+		return fmt.Errorf("from version '%s' parse error: %w", fromVer, err)
+	}
+
+	if strings.Contains(toVer, "@") {
+		toVer = strings.Split(toVer, "@")[0]
+	}
+	to, err := semver.NewVersion(toVer)
+	if err != nil {
+		return fmt.Errorf("to version '%s' parse error: %w", toVer, err)
+	}
+
+	if to.Major() < from.Major() || to.Minor() < from.Minor() {
+		return fmt.Errorf("downgrading from %s to %s is not supported, reinstall needed", fromVer, toVer)
+	}
+
+	return nil
+}
+
 // MatchVersion returns the latest version dir path that matches the given semver range.
 func MatchVersion(dataDir, semverRange string) (string, error) {
 	if _, err := os.Stat(dataDir); os.IsNotExist(err) {
diff --git a/internal/controller/fluxinstance_controller.go b/internal/controller/fluxinstance_controller.go
index c45c63f..0b98b67 100644
--- a/internal/controller/fluxinstance_controller.go
+++ b/internal/controller/fluxinstance_controller.go
@@ -183,6 +183,12 @@ func (r *FluxInstanceReconciler) build(ctx context.Context,
 		return nil, err
 	}
 
+	if obj.Status.LastAppliedRevision != "" {
+		if err := builder.IsCompatibleVersion(obj.Status.LastAppliedRevision, ver); err != nil {
+			return nil, err
+		}
+	}
+
 	options := builder.MakeDefaultOptions()
 	options.Version = ver
 	options.Registry = obj.GetDistribution().Registry
diff --git a/internal/controller/fluxinstance_controller_test.go b/internal/controller/fluxinstance_controller_test.go
index 0a35a61..6abec07 100644
--- a/internal/controller/fluxinstance_controller_test.go
+++ b/internal/controller/fluxinstance_controller_test.go
@@ -9,6 +9,7 @@ import (
 	"testing"
 	"time"
 
+	"github.com/fluxcd/pkg/apis/kustomize"
 	"github.com/fluxcd/pkg/apis/meta"
 	"github.com/fluxcd/pkg/runtime/conditions"
 	. "github.com/onsi/gomega"
@@ -233,6 +234,84 @@ func TestFluxInstanceReconciler_InstallFail(t *testing.T) {
 	g.Expect(apierrors.IsNotFound(err)).To(BeTrue())
 }
 
+func TestFluxInstanceReconciler_Downgrade(t *testing.T) {
+	g := NewWithT(t)
+	reconciler := getFluxInstanceReconciler()
+	spec := getDefaultFluxSpec()
+	ctx, cancel := context.WithTimeout(context.Background(), timeout)
+	defer cancel()
+
+	ns, err := testEnv.CreateNamespace(ctx, "test")
+	g.Expect(err).ToNot(HaveOccurred())
+
+	obj := &fluxcdv1.FluxInstance{
+		ObjectMeta: metav1.ObjectMeta{
+			Name:      ns.Name,
+			Namespace: ns.Name,
+		},
+		Spec: spec,
+	}
+
+	err = testClient.Create(ctx, obj)
+	g.Expect(err).ToNot(HaveOccurred())
+
+	// Initialize the instance.
+	r, err := reconciler.Reconcile(ctx, reconcile.Request{
+		NamespacedName: client.ObjectKeyFromObject(obj),
+	})
+	g.Expect(err).ToNot(HaveOccurred())
+	g.Expect(r.Requeue).To(BeTrue())
+
+	// Install the instance.
+	r, err = reconciler.Reconcile(ctx, reconcile.Request{
+		NamespacedName: client.ObjectKeyFromObject(obj),
+	})
+	g.Expect(err).ToNot(HaveOccurred())
+
+	// Check if the instance was installed.
+	result := &fluxcdv1.FluxInstance{}
+	err = testClient.Get(ctx, client.ObjectKeyFromObject(obj), result)
+	g.Expect(err).ToNot(HaveOccurred())
+	checkInstanceReadiness(g, result)
+
+	// Try to downgrade.
+	resultP := result.DeepCopy()
+	resultP.Spec.Distribution.Version = "v2.2.x"
+	err = testClient.Patch(ctx, resultP, client.MergeFrom(result))
+	g.Expect(err).ToNot(HaveOccurred())
+
+	r, err = reconciler.Reconcile(ctx, reconcile.Request{
+		NamespacedName: client.ObjectKeyFromObject(obj),
+	})
+	g.Expect(err).ToNot(HaveOccurred())
+
+	// Check the final status.
+	resultFinal := &fluxcdv1.FluxInstance{}
+	err = testClient.Get(ctx, client.ObjectKeyFromObject(obj), resultFinal)
+	g.Expect(err).ToNot(HaveOccurred())
+
+	// Check if the downgraded was rejected.
+	logObjectStatus(t, resultFinal)
+	g.Expect(conditions.IsStalled(resultFinal)).To(BeTrue())
+	g.Expect(conditions.GetMessage(resultFinal, meta.ReadyCondition)).To(ContainSubstring("is not supported"))
+
+	// Uninstall the instance.
+	err = testClient.Delete(ctx, obj)
+	g.Expect(err).ToNot(HaveOccurred())
+
+	r, err = reconciler.Reconcile(ctx, reconcile.Request{
+		NamespacedName: client.ObjectKeyFromObject(obj),
+	})
+	g.Expect(err).ToNot(HaveOccurred())
+	g.Expect(r.IsZero()).To(BeTrue())
+
+	// Check if the instance was uninstalled.
+	sc := &appsv1.Deployment{}
+	err = testClient.Get(ctx, types.NamespacedName{Name: "source-controller", Namespace: ns.Name}, sc)
+	g.Expect(err).To(HaveOccurred())
+	g.Expect(apierrors.IsNotFound(err)).To(BeTrue())
+}
+
 func TestFluxInstanceReconciler_Profiles(t *testing.T) {
 	g := NewWithT(t)
 	reconciler := getFluxInstanceReconciler()
@@ -305,3 +384,27 @@ func TestFluxInstanceReconciler_Profiles(t *testing.T) {
 	g.Expect(err).To(HaveOccurred())
 	g.Expect(apierrors.IsNotFound(err)).To(BeTrue())
 }
+
+func getDefaultFluxSpec() fluxcdv1.FluxInstanceSpec {
+	return fluxcdv1.FluxInstanceSpec{
+		Wait: false,
+		Distribution: fluxcdv1.Distribution{
+			Version:  "v2.3.x",
+			Registry: "ghcr.io/fluxcd",
+		},
+		Kustomize: &fluxcdv1.Kustomize{
+			Patches: []kustomize.Patch{
+				{
+					Target: &kustomize.Selector{
+						Kind: "Deployment",
+					},
+					Patch: `
+- op: replace
+  path: /spec/replicas
+  value: 0
+`,
+				},
+			},
+		},
+	}
+}
diff --git a/internal/controller/suite_test.go b/internal/controller/suite_test.go
index c2fbb78..cb0ca34 100644
--- a/internal/controller/suite_test.go
+++ b/internal/controller/suite_test.go
@@ -12,7 +12,6 @@ import (
 	"time"
 
 	"github.com/fluxcd/cli-utils/pkg/kstatus/polling"
-	"github.com/fluxcd/pkg/apis/kustomize"
 	"github.com/fluxcd/pkg/apis/meta"
 	"github.com/fluxcd/pkg/runtime/conditions"
 	kcheck "github.com/fluxcd/pkg/runtime/conditions/check"
@@ -119,27 +118,3 @@ func getEvents(objName string) []corev1.Event {
 	}
 	return result
 }
-
-func getDefaultFluxSpec() fluxcdv1.FluxInstanceSpec {
-	return fluxcdv1.FluxInstanceSpec{
-		Wait: false,
-		Distribution: fluxcdv1.Distribution{
-			Version:  "*",
-			Registry: "ghcr.io/fluxcd",
-		},
-		Kustomize: &fluxcdv1.Kustomize{
-			Patches: []kustomize.Patch{
-				{
-					Target: &kustomize.Selector{
-						Kind: "Deployment",
-					},
-					Patch: `
-- op: replace
-  path: /spec/replicas
-  value: 0
-`,
-				},
-			},
-		},
-	}
-}