diff --git a/src/strands/tools/mcp/mcp_client.py b/src/strands/tools/mcp/mcp_client.py
index 402005604..f810fed06 100644
--- a/src/strands/tools/mcp/mcp_client.py
+++ b/src/strands/tools/mcp/mcp_client.py
@@ -143,6 +143,18 @@ def stop(
         This method is defensive and can handle partial initialization states that may occur
         if start() fails partway through initialization.
 
+        Resources to cleanup:
+        - _background_thread: Thread running the async event loop
+        - _background_thread_session: MCP ClientSession (auto-closed by context manager)
+        - _background_thread_event_loop: AsyncIO event loop in background thread
+        - _close_event: AsyncIO event to signal thread shutdown
+        - _init_future: Future for initialization synchronization
+        
+        Cleanup order:
+        1. Signal close event to background thread (if session initialized)
+        2. Wait for background thread to complete
+        3. Reset all state for reuse
+
         Args:
             exc_type: Exception type if an exception was raised in the context
             exc_val: Exception value if an exception was raised in the context
@@ -158,7 +170,9 @@ def stop(
                 async def _set_close_event() -> None:
                     self._close_event.set()
 
-                self._invoke_on_background_thread(_set_close_event()).result()
+                # Not calling _invoke_on_background_thread since the session does not need to exist
+                # we only need the thread and event loop to exist.
+                asyncio.run_coroutine_threadsafe(coro=_set_close_event(), loop=self._background_thread_event_loop)
 
             self._log_debug_with_thread("waiting for background thread to join")
             self._background_thread.join()
@@ -168,6 +182,8 @@ async def _set_close_event() -> None:
         self._init_future = futures.Future()
         self._close_event = asyncio.Event()
         self._background_thread = None
+        self._background_thread_session = None
+        self._background_thread_event_loop = None
         self._session_id = uuid.uuid4()
 
     def list_tools_sync(self, pagination_token: Optional[str] = None) -> PaginatedList[MCPAgentTool]:
diff --git a/tests/strands/tools/mcp/test_mcp_client.py b/tests/strands/tools/mcp/test_mcp_client.py
index 8514a67d4..d161df6d4 100644
--- a/tests/strands/tools/mcp/test_mcp_client.py
+++ b/tests/strands/tools/mcp/test_mcp_client.py
@@ -521,3 +521,22 @@ def test_stop_with_background_thread_but_no_event_loop():
 
     # Verify cleanup occurred
     assert client._background_thread is None
+
+    
+def test_mcp_client_state_reset_after_timeout():
+    """Test that all client state is properly reset after timeout."""
+    def slow_transport():
+        time.sleep(4)  # Longer than timeout
+        return MagicMock()
+
+    client = MCPClient(slow_transport, startup_timeout=2)
+    
+    # First attempt should timeout
+    with pytest.raises(MCPClientInitializationError, match="background thread did not start in 2 seconds"):
+        client.start()
+
+    # Verify all state is reset
+    assert client._background_thread is None
+    assert client._background_thread_session is None
+    assert client._background_thread_event_loop is None
+    assert not client._init_future.done()  # New future created
\ No newline at end of file
diff --git a/tests_integ/test_mcp_client.py b/tests_integ/test_mcp_client.py
index 4e358f4f2..0723750c2 100644
--- a/tests_integ/test_mcp_client.py
+++ b/tests_integ/test_mcp_client.py
@@ -297,3 +297,4 @@ def slow_transport():
     with client:
         tools = client.list_tools_sync()
         assert len(tools) >= 0  # Should work now
+