diff --git a/CHANGELOG_PENDING.md b/CHANGELOG_PENDING.md
index 1b847da51..1dcee4468 100644
--- a/CHANGELOG_PENDING.md
+++ b/CHANGELOG_PENDING.md
@@ -12,7 +12,7 @@ Special thanks to external contributors on this release:
 
 - CLI/RPC/Config
 
-  - [cli] \#8081 make the reset command safe to use (@marbar3778).
+  - [cli] \#8081 make the reset command safe to use (@marbar3778) by intoducing `reset-state` command. Fixed by \#8259.
 
 - Apps
 
diff --git a/cmd/tendermint/commands/reset_priv_validator.go b/cmd/tendermint/commands/reset.go
similarity index 96%
rename from cmd/tendermint/commands/reset_priv_validator.go
rename to cmd/tendermint/commands/reset.go
index e9e2e1fd4..1f6c42d57 100644
--- a/cmd/tendermint/commands/reset_priv_validator.go
+++ b/cmd/tendermint/commands/reset.go
@@ -70,6 +70,11 @@ func resetAll(dbDir, addrBookFile, privValKeyFile, privValStateFile string, logg
 		logger.Error("Error removing all blockchain history", "dir", dbDir, "err", err)
 	}
 
+	if err := tmos.EnsureDir(dbDir, 0700); err != nil {
+		logger.Error("unable to recreate dbDir", "err", err)
+	}
+
+	// recreate the dbDir since the privVal state needs to live there
 	return resetFilePV(privValKeyFile, privValStateFile, logger, keyType)
 }
 
@@ -129,6 +134,7 @@ func resetState(dbDir string, logger log.Logger, keyType string) error {
 			logger.Error("error removing peerstore.db", "dir", peerstore, "err", err)
 		}
 	}
+
 	if err := tmos.EnsureDir(dbDir, 0700); err != nil {
 		logger.Error("unable to recreate dbDir", "err", err)
 	}
diff --git a/cmd/tendermint/commands/reset_test.go b/cmd/tendermint/commands/reset_test.go
new file mode 100644
index 000000000..10611c9e4
--- /dev/null
+++ b/cmd/tendermint/commands/reset_test.go
@@ -0,0 +1,57 @@
+package commands
+
+import (
+	"path/filepath"
+	"testing"
+
+	"github.com/stretchr/testify/require"
+
+	cfg "github.com/tendermint/tendermint/config"
+	"github.com/tendermint/tendermint/privval"
+)
+
+func Test_ResetAll(t *testing.T) {
+	config := cfg.TestConfig()
+	dir := t.TempDir()
+	config.SetRoot(dir)
+	cfg.EnsureRoot(dir)
+	require.NoError(t, initFilesWithConfig(config))
+	pv, err := privval.LoadFilePV(config.PrivValidator.KeyFile(), config.PrivValidator.StateFile())
+	require.NoError(t, err)
+	pv.LastSignState.Height = 10
+	pv.Save()
+	require.NoError(t, resetAll(config.DBDir(), config.P2P.AddrBookFile(), config.PrivValidator.KeyFile(),
+		config.PrivValidator.StateFile(), logger))
+	require.DirExists(t, config.DBDir())
+	require.NoFileExists(t, filepath.Join(config.DBDir(), "block.db"))
+	require.NoFileExists(t, filepath.Join(config.DBDir(), "state.db"))
+	require.NoFileExists(t, filepath.Join(config.DBDir(), "evidence.db"))
+	require.NoFileExists(t, filepath.Join(config.DBDir(), "tx_index.db"))
+	require.FileExists(t, config.PrivValidator.StateFile())
+	pv, err = privval.LoadFilePV(config.PrivValidator.KeyFile(), config.PrivValidator.StateFile())
+	require.NoError(t, err)
+	require.Equal(t, int64(0), pv.LastSignState.Height)
+}
+
+func Test_ResetState(t *testing.T) {
+	config := cfg.TestConfig()
+	dir := t.TempDir()
+	config.SetRoot(dir)
+	cfg.EnsureRoot(dir)
+	require.NoError(t, initFilesWithConfig(config))
+	pv, err := privval.LoadFilePV(config.PrivValidator.KeyFile(), config.PrivValidator.StateFile())
+	require.NoError(t, err)
+	pv.LastSignState.Height = 10
+	pv.Save()
+	require.NoError(t, resetState(config.DBDir(), logger, keyType))
+	require.DirExists(t, config.DBDir())
+	require.NoFileExists(t, filepath.Join(config.DBDir(), "block.db"))
+	require.NoFileExists(t, filepath.Join(config.DBDir(), "state.db"))
+	require.NoFileExists(t, filepath.Join(config.DBDir(), "evidence.db"))
+	require.NoFileExists(t, filepath.Join(config.DBDir(), "tx_index.db"))
+	require.FileExists(t, config.PrivValidator.StateFile())
+	pv, err = privval.LoadFilePV(config.PrivValidator.KeyFile(), config.PrivValidator.StateFile())
+	require.NoError(t, err)
+	// private validator state should still be intact.
+	require.Equal(t, int64(10), pv.LastSignState.Height)
+}
diff --git a/internal/p2p/pex/reactor_test.go b/internal/p2p/pex/reactor_test.go
index d00260587..d647253b3 100644
--- a/internal/p2p/pex/reactor_test.go
+++ b/internal/p2p/pex/reactor_test.go
@@ -1,6 +1,6 @@
 // Temporarily disabled pending ttps://github.com/tendermint/tendermint/issues/7626.
 //go:build issue7626
-//+build issue7626
+// +build issue7626
 
 package pex_test