diff --git a/CHANGELOG.md b/CHANGELOG.md
index 0b4c5b833f..b4ca697732 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -27,6 +27,7 @@ This project adheres to [Semantic Versioning](http://semver.org/).
  - #3795, Clarify `Accept: vnd.pgrst.object` error message - @steve-chavez
  - #3779, Always log the schema cache load time - @steve-chavez
  - #3706, Fix insert with `missing=default` uses default value of domain instead of column - @taimoorzaeem
+ - #3788, Fix jwt cache does not remove expired entries - @taimoorzaeem
 
 ### Changed
 
diff --git a/src/PostgREST/Auth.hs b/src/PostgREST/Auth.hs
index c8c3b720cb..bbef5f8228 100644
--- a/src/PostgREST/Auth.hs
+++ b/src/PostgREST/Auth.hs
@@ -181,10 +181,33 @@ getJWTFromCache appState token maxLifetime parseJwt utc = do
   authResult <- maybe parseJwt (pure . Right) checkCache
 
   case (authResult,checkCache) of
-    (Right res, Nothing) -> C.insert' (getJwtCache appState) (getTimeSpec res maxLifetime utc) token res
+    -- From comment:
+    -- https://github.com/PostgREST/postgrest/pull/3801#discussion_r1857987914
+    --
+    -- We purge expired cache entries on a cache miss
+    -- The reasoning is that:
+    --
+    -- 1. We expect it to be rare (otherwise there is no point of the cache)
+    -- 2. It makes sure the cache is not growing (as inserting new entries
+    --    does garbage collection)
+    -- 3. Since this is time expiration based cache there is no real risk of
+    --    starvation - sooner or later we are going to have a cache miss.
+
+    (Right res, Nothing) -> do -- cache miss
+
+      let timeSpec = getTimeSpec res maxLifetime utc
+
+      -- purge expired cache entries
+      C.purgeExpired jwtCache
+
+      -- insert new cache entry
+      C.insert' jwtCache timeSpec token res
+
     _                    -> pure ()
 
   return authResult
+    where
+      jwtCache = getJwtCache appState
 
 -- Used to extract JWT exp claim and add to JWT Cache
 getTimeSpec :: AuthResult -> Int -> UTCTime -> Maybe TimeSpec
diff --git a/test/io/test_io.py b/test/io/test_io.py
index e61e074cbc..7d06ffcaa6 100644
--- a/test/io/test_io.py
+++ b/test/io/test_io.py
@@ -1648,3 +1648,51 @@ def test_schema_cache_startup_load_with_in_db_config(defaultenv, metapostgrest):
     response = metapostgrest.session.post("/rpc/reset_db_schemas_config")
     assert response.text == ""
     assert response.status_code == 204
+
+
+def test_jwt_cache_purges_expired_entries(defaultenv):
+    "test expired cache entries are purged on cache miss"
+
+    # The verification of actual cache size reduction is done manually, see https://github.com/PostgREST/postgrest/pull/3801#issuecomment-2620776041
+    # This test is written for code coverage of purgeExpired function
+
+    relativeSeconds = lambda sec: int(
+        (datetime.now(timezone.utc) + timedelta(seconds=sec)).timestamp()
+    )
+
+    headers = lambda sec: jwtauthheader(
+        {"role": "postgrest_test_author", "exp": relativeSeconds(sec)},
+        SECRET,
+    )
+
+    env = {
+        **defaultenv,
+        "PGRST_JWT_CACHE_MAX_LIFETIME": "86400",
+        "PGRST_JWT_SECRET": SECRET,
+        "PGRST_DB_CONFIG": "false",
+    }
+
+    with run(env=env) as postgrest:
+
+        # Generate two unique JWT tokens
+        # The 1 second sleep is needed for it generate a unique token
+        hdrs1 = headers(5)
+        postgrest.session.get("/authors_only", headers=hdrs1)
+
+        time.sleep(1)
+
+        hdrs2 = headers(5)
+        postgrest.session.get("/authors_only", headers=hdrs2)
+
+        # Wait 5 seconds for the tokens to expire
+        time.sleep(5)
+
+        hdrs3 = headers(5)
+
+        # Make another request which should cause a cache miss and so
+        # the purgeExpired function will be triggered.
+        #
+        # This should remove the 2 expired tokens but adds another to cache
+        response = postgrest.session.get("/authors_only", headers=hdrs3)
+
+        assert response.status_code == 200