diff --git a/edb/server/dbview/dbview.pyx b/edb/server/dbview/dbview.pyx
index 8c6b7baad9f..d81190dbb93 100644
--- a/edb/server/dbview/dbview.pyx
+++ b/edb/server/dbview/dbview.pyx
@@ -767,6 +767,7 @@ cdef class DatabaseConnectionView:
             self._db._index._global_schema_pickle
         self._in_tx_user_config_spec = self._db.user_config_spec
         self._in_tx_state_serializer = state_serializer
+        self._in_tx_dbver = self._db.dbver
 
     cdef _apply_in_tx(self, query_unit):
         if query_unit.has_ddl:
@@ -778,6 +779,7 @@ cdef class DatabaseConnectionView:
         if query_unit.has_set:
             self._in_tx_with_set = True
         if query_unit.user_schema is not None:
+            self._in_tx_dbver = next_dbver()
             self._in_tx_user_schema_pickle = query_unit.user_schema
             self._in_tx_user_config_spec = config.FlatSpec(
                 *query_unit.ext_config_settings
@@ -804,7 +806,6 @@ cdef class DatabaseConnectionView:
             if new_types:
                 self._db._update_backend_ids(new_types)
             if query_unit.user_schema is not None:
-                self._in_tx_dbver = next_dbver()
                 self._db._set_and_signal_new_user_schema(
                     query_unit.user_schema,
                     query_unit.extensions,
@@ -977,7 +978,7 @@ cdef class DatabaseConnectionView:
         if query_unit_group is None:
             # Cache miss; need to compile this query.
             cached = False
-            dbver = self._db.dbver
+            dbver = self.dbver
 
             try:
                 query_unit_group = await self._compile(query_req)
diff --git a/tests/test_server_proto.py b/tests/test_server_proto.py
index 7d7afde100e..f34ad079953 100644
--- a/tests/test_server_proto.py
+++ b/tests/test_server_proto.py
@@ -2886,6 +2886,54 @@ async def test_server_proto_query_cache_invalidate_10(self):
         finally:
             await con2.aclose()
 
+    async def test_server_proto_query_cache_invalidate_11(self):
+        typename = 'CacheInv_11'
+
+        await self.con.execute(f"""
+            CREATE TYPE {typename} {{
+                CREATE PROPERTY prop1 -> std::int64;
+            }};
+            INSERT {typename} {{ prop1 := 42 }};
+        """)
+
+        class Rollback(Exception):
+            pass
+
+        with self.assertRaises(Rollback):
+            async with self.con.transaction():
+                # make sure the transaction is started
+                await self.con.query('SELECT 123')
+
+                # DDL in another connection
+                con2 = await self.connect(database=self.con.dbname)
+                try:
+                    await con2.execute(f"""
+                        ALTER TYPE {typename} {{
+                            DROP PROPERTY prop1;
+                        }};
+                    """)
+                finally:
+                    await con2.aclose()
+
+                # This compiles fine with the schema in the transaction, and
+                # the compile result is cached with an outdated version.
+                # However, the execution fails because the column is already
+                # dropped outside the transaction.
+                # FIXME: ISE is not an ideal error as for user experience here
+                with self.assertRaisesRegex(
+                    edgedb.InternalServerError, "column.*does not exist"
+                ):
+                    await self.con.query(f'SELECT {typename}.prop1')
+
+                raise Rollback
+
+        # Should recompile with latest schema, instead of reusing a wrong cache
+        with self.assertRaisesRegex(
+            edgedb.InvalidReferenceError,
+            "has no link or property 'prop1'"
+        ):
+            await self.con.query(f'SELECT {typename}.prop1')
+
     async def test_server_proto_backend_tid_propagation_01(self):
         async with self._run_and_rollback():
             await self.con.execute('''