diff --git a/doc/reduce-memory.md b/doc/reduce-memory.md
index 296b172bdea..097cc9f0010 100644
--- a/doc/reduce-memory.md
+++ b/doc/reduce-memory.md
@@ -16,12 +16,12 @@ The size of some in-memory caches can be reduced. As caches trade off memory usa
   - The minimum value for `-maxmempool` is 5.
   - A lower maximum mempool size means that transactions will be evicted sooner. This will affect any uses of `bitcoind` that process unconfirmed transactions.
 
-- To completely disable mempool functionality there is the option `-blocksonly`. This will make the client opt out of receiving (and thus relaying) transactions completely, except as part of blocks.
+- Since `0.14.0`, unused memory allocated to the mempool (default: 300MB) is shared with the UTXO cache, so when trying to reduce memory usage you should limit the mempool, with the `-maxmempool` command line argument.
+
+- To disable most of the mempool functionality there is the `-blocksonly` option. This will reduce the default memory usage to 5MB and make the client opt out of receiving (and thus relaying) transactions, except from whitelisted peers and as part of blocks.
 
   - Do not use this when using the client to broadcast transactions as any transaction sent will stick out like a sore thumb, affecting privacy. When used with the wallet it should be combined with `-walletbroadcast=0` and `-spendzeroconfchange=0`. Another mechanism for broadcasting outgoing transactions (if any) should be used.
 
-- Since `0.14.0`, unused memory allocated to the mempool (default: 300MB) is shared with the UTXO cache, so when trying to reduce memory usage you should limit the mempool, with the `-maxmempool` command line argument.
-
 ## Number of peers
 
 - `-maxconnections=<n>` - the maximum number of connections, which defaults to 125. Each active connection takes up some
diff --git a/doc/release-notes-26471.md b/doc/release-notes-26471.md
new file mode 100644
index 00000000000..2cb74804cad
--- /dev/null
+++ b/doc/release-notes-26471.md
@@ -0,0 +1,13 @@
+Updated settings
+----------------
+
+- Setting `-blocksonly` will now reduce the maximum mempool memory
+  to 5MB (users may still use `-maxmempool` to override). Previously,
+  the default 300MB would be used, leading to unexpected memory usage
+  for users running with `-blocksonly` expecting it to eliminate
+  mempool memory usage.
+
+  As unused mempool memory is shared with dbcache, this also reduces
+  the dbcache size for users running with `-blocksonly`, potentially
+  impacting performance.
+
diff --git a/src/init.cpp b/src/init.cpp
index 685583bcbd8..d8d8a66d346 100644
--- a/src/init.cpp
+++ b/src/init.cpp
@@ -736,10 +736,13 @@ void InitParameterInteraction(ArgsManager& args)
             LogPrintf("%s: parameter interaction: -externalip set -> setting -discover=0\n", __func__);
     }
 
-    // disable whitelistrelay in blocksonly mode
     if (args.GetBoolArg("-blocksonly", DEFAULT_BLOCKSONLY)) {
+        // disable whitelistrelay in blocksonly mode
         if (args.SoftSetBoolArg("-whitelistrelay", false))
             LogPrintf("%s: parameter interaction: -blocksonly=1 -> setting -whitelistrelay=0\n", __func__);
+        // Reduce default mempool size in blocksonly mode to avoid unexpected resource usage
+        if (args.SoftSetArg("-maxmempool", ToString(DEFAULT_BLOCKSONLY_MAX_MEMPOOL_SIZE_MB)))
+            LogPrintf("%s: parameter interaction: -blocksonly=1 -> setting -maxmempool=%d\n", __func__, DEFAULT_BLOCKSONLY_MAX_MEMPOOL_SIZE_MB);
     }
 
     // Forcing relay from whitelisted hosts implies we will accept relays from them in the first place.
diff --git a/src/kernel/mempool_options.h b/src/kernel/mempool_options.h
index dad6f14c391..a5a0bae86d1 100644
--- a/src/kernel/mempool_options.h
+++ b/src/kernel/mempool_options.h
@@ -18,6 +18,8 @@ class CBlockPolicyEstimator;
 
 /** Default for -maxmempool, maximum megabytes of mempool memory usage */
 static constexpr unsigned int DEFAULT_MAX_MEMPOOL_SIZE_MB{300};
+//** Default for -maxmempool when blocksonly is set */
+static constexpr unsigned int DEFAULT_BLOCKSONLY_MAX_MEMPOOL_SIZE_MB{5};
 /** Default for -mempoolexpiry, expiration time for mempool transactions in hours */
 static constexpr unsigned int DEFAULT_MEMPOOL_EXPIRY_HOURS{336};
 /** Default for -mempoolfullrbf, if the transaction replaceability signaling is ignored */