diff --git a/src/main/java/org/folio/linked/data/service/resource/marc/ResourceMarcAuthorityServiceImpl.java b/src/main/java/org/folio/linked/data/service/resource/marc/ResourceMarcAuthorityServiceImpl.java
index 748053b9..624ec5fe 100644
--- a/src/main/java/org/folio/linked/data/service/resource/marc/ResourceMarcAuthorityServiceImpl.java
+++ b/src/main/java/org/folio/linked/data/service/resource/marc/ResourceMarcAuthorityServiceImpl.java
@@ -125,15 +125,18 @@ private RequestProcessingException notFoundException(String srsId) {
 
   @Override
   public Long saveMarcAuthority(org.folio.ld.dictionary.model.Resource modelResource) {
-    var mapped = resourceModelMapper.toEntity(modelResource);
-    validateResource(mapped);
-    if (sameResourceExistsByIdAndSrsId(mapped)) {
-      return updateAuthority(mapped);
+    var resource = resourceModelMapper.toEntity(modelResource);
+    validateResource(resource);
+
+    if (existsBySrsIdAndIdUnchanged(resource)) {
+      return updateAuthority(resource);
     }
-    if (resourceExistsBySrsId(mapped)) {
-      return replaceAuthority(mapped);
+
+    if (existsBySrsId(resource)) {
+      return replaceAuthority(resource);
     }
-    return createAuthority(mapped);
+
+    return createAuthority(resource);
   }
 
   private static void validateResource(Resource resource) {
@@ -151,7 +154,7 @@ private static void logAndThrow(String message) {
     throw new IllegalArgumentException(message);
   }
 
-  private boolean sameResourceExistsByIdAndSrsId(Resource resource) {
+  private boolean existsBySrsIdAndIdUnchanged(Resource resource) {
     var id = resource.getId();
     var srsId  = resource.getFolioMetadata().getSrsId();
     return resourceRepo.existsById(id) && getIdBySrsId(srsId).filter(id::equals).isPresent();
@@ -162,7 +165,7 @@ private Optional<Long> getIdBySrsId(String srsId) {
       .map(FolioMetadataRepository.IdOnly::getId);
   }
 
-  private boolean resourceExistsBySrsId(Resource resource) {
+  private boolean existsBySrsId(Resource resource) {
     return folioMetadataRepository.existsBySrsId(resource.getFolioMetadata().getSrsId());
   }
 
diff --git a/src/test/java/org/folio/linked/data/service/resource/marc/ResourceMarcAuthorityServiceIT.java b/src/test/java/org/folio/linked/data/service/resource/marc/ResourceMarcAuthorityServiceIT.java
new file mode 100644
index 00000000..8b9d50ec
--- /dev/null
+++ b/src/test/java/org/folio/linked/data/service/resource/marc/ResourceMarcAuthorityServiceIT.java
@@ -0,0 +1,86 @@
+package org.folio.linked.data.service.resource.marc;
+
+import static org.assertj.core.api.Assertions.assertThat;
+import static org.folio.ld.dictionary.PredicateDictionary.REPLACED_BY;
+import static org.folio.linked.data.util.ResourceUtils.isPreferred;
+
+import com.fasterxml.jackson.databind.ObjectMapper;
+import java.util.Set;
+import lombok.SneakyThrows;
+import org.folio.ld.dictionary.ResourceTypeDictionary;
+import org.folio.ld.dictionary.model.FolioMetadata;
+import org.folio.ld.dictionary.model.Resource;
+import org.folio.linked.data.e2e.base.IntegrationTest;
+import org.folio.linked.data.test.resource.ResourceTestService;
+import org.junit.jupiter.api.Test;
+import org.springframework.beans.factory.annotation.Autowired;
+
+@IntegrationTest
+class ResourceMarcAuthorityServiceIT {
+  @Autowired
+  private ResourceMarcAuthorityService resourceMarcAuthorityService;
+  @Autowired
+  private ObjectMapper objectMapper;
+  @Autowired
+  private ResourceTestService resourceTestService;
+
+  @Test
+  @SneakyThrows
+  void testAuthorityPreferenceToggle_when_authority_is_reverted_back_to_original_state() {
+    var srsId = "src_id_01";
+
+    // save version 1 of the authority
+    var v1Resource = new Resource()
+      .setId(1L)
+      .setDoc(objectMapper.readTree("{}"))
+      .setTypes(Set.of(ResourceTypeDictionary.PERSON))
+      .setLabel("label_01")
+      .setFolioMetadata(new FolioMetadata().setSrsId(srsId));
+
+    resourceMarcAuthorityService.saveMarcAuthority(v1Resource);
+
+    // save version 2 of the authority
+    var v2Resource = new Resource()
+      .setId(2L)
+      .setDoc(v1Resource.getDoc())
+      .setTypes(v1Resource.getTypes())
+      .setLabel(v1Resource.getLabel())
+      .setFolioMetadata(v1Resource.getFolioMetadata());
+
+    resourceMarcAuthorityService.saveMarcAuthority(v2Resource);
+
+    var v1ResourceFromDb = resourceTestService.getResourceById("1", 1);
+    var v2ResourceFromDb = resourceTestService.getResourceById("2", 1);
+    assertResourceIsPreferred(v2ResourceFromDb);
+    assertResourceIsNotPreferred(v1ResourceFromDb);
+    assertReplacedBy(v1ResourceFromDb, v2ResourceFromDb);
+
+    // Revert the authority back to the original (v1) version
+    resourceMarcAuthorityService.saveMarcAuthority(v1Resource);
+
+    v1ResourceFromDb = resourceTestService.getResourceById("1", 1);
+    v2ResourceFromDb = resourceTestService.getResourceById("2", 1);
+    assertResourceIsPreferred(v1ResourceFromDb);
+    assertResourceIsNotPreferred(v2ResourceFromDb);
+    assertReplacedBy(v2ResourceFromDb, v1ResourceFromDb);
+  }
+
+  private void assertResourceIsPreferred(org.folio.linked.data.model.entity.Resource resource) {
+    assertThat(resource.isActive()).isTrue();
+    assertThat(isPreferred(resource)).isTrue();
+    assertThat(resource.getOutgoingEdges()).isEmpty();
+  }
+
+  private void assertResourceIsNotPreferred(org.folio.linked.data.model.entity.Resource resource) {
+    assertThat(resource.isActive()).isFalse();
+    assertThat(isPreferred(resource)).isFalse();
+  }
+
+  private void assertReplacedBy(org.folio.linked.data.model.entity.Resource resource,
+                                org.folio.linked.data.model.entity.Resource replacedBy) {
+    assertThat(resource.getOutgoingEdges()).hasSize(1);
+    assertThat(resource.getOutgoingEdges()).allMatch(
+      edge -> edge.getPredicate().getUri().equals(REPLACED_BY.getUri()) && edge.getTarget().equals(replacedBy)
+    );
+  }
+}