diff --git a/src/modules/mc_pos_control/mc_pos_control_main.cpp b/src/modules/mc_pos_control/mc_pos_control_main.cpp
index a26a65d468..6776d78871 100644
--- a/src/modules/mc_pos_control/mc_pos_control_main.cpp
+++ b/src/modules/mc_pos_control/mc_pos_control_main.cpp
@@ -1141,6 +1141,16 @@ MulticopterPositionControl::task_main()
 			_run_pos_control = true;
 			_run_alt_control = true;
 
+			// reset the horizontal and vertical position hold flags for non-manual modes
+			// or if position is not controlled
+			if (!_control_mode.flag_control_position_enabled || !_control_mode.flag_control_manual_enabled) {
+				_pos_hold_engaged = false;
+			}
+
+			if (!_control_mode.flag_control_altitude_enabled || !_control_mode.flag_control_manual_enabled) {
+				_alt_hold_engaged = false;
+			}
+
 			/* select control source */
 			if (_control_mode.flag_control_manual_enabled) {
 				/* manual control */