diff --git a/app/services/merge_requests/merge_service.rb b/app/services/merge_requests/merge_service.rb
index ba22b4587771fb3c83a4b1f07817f48ebe2be142..407f2ad70f8668f6811dded1ba097409e5dbb591 100644
--- a/app/services/merge_requests/merge_service.rb
+++ b/app/services/merge_requests/merge_service.rb
@@ -88,7 +88,13 @@ def commit
     end
 
     def try_merge
-      repository.merge(current_user, source, merge_request, commit_message)
+      merge = repository.merge(current_user, source, merge_request, commit_message)
+
+      if merge_request.squash_on_merge? && Feature.enabled?(:persist_squash_commit_sha_for_squashes, project)
+        merge_request.update_column(:squash_commit_sha, source)
+      end
+
+      merge
     rescue Gitlab::Git::PreReceiveError => e
       raise MergeError,
             "Something went wrong during merge pre-receive hook. #{e.message}".strip
diff --git a/config/feature_flags/development/persist_squash_commit_sha_for_squashes.yml b/config/feature_flags/development/persist_squash_commit_sha_for_squashes.yml
new file mode 100644
index 0000000000000000000000000000000000000000..835437278c4987dfb01984237966795099eb368f
--- /dev/null
+++ b/config/feature_flags/development/persist_squash_commit_sha_for_squashes.yml
@@ -0,0 +1,8 @@
+---
+name: persist_squash_commit_sha_for_squashes
+introduced_by_url: https://gitlab.com/gitlab-org/gitlab/-/merge_requests/50178
+rollout_issue_url: https://gitlab.com/gitlab-org/gitlab/-/issues/294243
+milestone: '13.8'
+type: development
+group: group::source code
+default_enabled: false
diff --git a/spec/services/merge_requests/merge_service_spec.rb b/spec/services/merge_requests/merge_service_spec.rb
index d0e3102f1573a1cb832a995648b1d984f795acb7..4e1d8b3a9a96caae95dcc900af90c025e83ef35a 100644
--- a/spec/services/merge_requests/merge_service_spec.rb
+++ b/spec/services/merge_requests/merge_service_spec.rb
@@ -19,8 +19,12 @@
       { commit_message: 'Awesome message', sha: merge_request.diff_head_sha }
     end
 
+    let(:feature_flag_persist_squash) { true }
+
     context 'valid params' do
       before do
+        stub_feature_flags(persist_squash_commit_sha_for_squashes: feature_flag_persist_squash)
+
         allow(service).to receive(:execute_hooks)
         expect(merge_request).to receive(:update_and_mark_in_progress_merge_commit_sha).twice.and_call_original
 
@@ -37,6 +41,10 @@
         expect(merge_request.in_progress_merge_commit_sha).to be_nil
       end
 
+      it 'does not update squash_commit_sha if it is not a squash' do
+        expect(merge_request.squash_commit_sha).to be_nil
+      end
+
       it 'sends email to user2 about merge of new merge_request' do
         email = ActionMailer::Base.deliveries.last
         expect(email.to.first).to eq(user2.email)
@@ -76,6 +84,20 @@
           expect(merge_commit.message).to eq('Merge commit message')
           expect(squash_commit.message).to eq("Squash commit message\n")
         end
+
+        it 'persists squash_commit_sha' do
+          squash_commit = merge_request.merge_commit.parents.last
+
+          expect(merge_request.squash_commit_sha).to eq(squash_commit.id)
+        end
+
+        context 'when feature flag is disabled' do
+          let(:feature_flag_persist_squash) { false }
+
+          it 'does not populate squash_commit_sha' do
+            expect(merge_request.squash_commit_sha).to be_nil
+          end
+        end
       end
     end
 
@@ -361,6 +383,7 @@
           expect(merge_request).to be_open
 
           expect(merge_request.merge_commit_sha).to be_nil
+          expect(merge_request.squash_commit_sha).to be_nil
           expect(merge_request.merge_error).to include(error_message)
           expect(Gitlab::AppLogger).to have_received(:error).with(a_string_matching(error_message))
         end
@@ -381,6 +404,7 @@
 
           expect(merge_request).to be_open
           expect(merge_request.merge_commit_sha).to be_nil
+          expect(merge_request.squash_commit_sha).to be_nil
           expect(merge_request.merge_error).to include(error_message)
           expect(Gitlab::AppLogger).to have_received(:error).with(a_string_matching(error_message))
         end
@@ -395,10 +419,27 @@
 
           expect(merge_request).to be_open
           expect(merge_request.merge_commit_sha).to be_nil
+          expect(merge_request.squash_commit_sha).to be_nil
           expect(merge_request.merge_error).to include(error_message)
           expect(Gitlab::AppLogger).to have_received(:error).with(a_string_matching(error_message))
         end
 
+        it 'logs and saves error if there is an PreReceiveError exception' do
+          error_message = 'error message'
+
+          allow(service).to receive(:repository).and_raise(Gitlab::Git::PreReceiveError, "GitLab: #{error_message}")
+          allow(service).to receive(:execute_hooks)
+          merge_request.update!(squash: true)
+
+          service.execute(merge_request)
+
+          expect(merge_request).to be_open
+          expect(merge_request.merge_commit_sha).to be_nil
+          expect(merge_request.squash_commit_sha).to be_nil
+          expect(merge_request.merge_error).to include('Something went wrong during merge pre-receive hook')
+          expect(Gitlab::AppLogger).to have_received(:error).with(a_string_matching(error_message))
+        end
+
         context 'when fast-forward merge is not allowed' do
           before do
             allow_any_instance_of(Repository).to receive(:ancestor?).and_return(nil)
@@ -415,6 +456,7 @@
 
               expect(merge_request).to be_open
               expect(merge_request.merge_commit_sha).to be_nil
+              expect(merge_request.squash_commit_sha).to be_nil
               expect(merge_request.merge_error).to include(error_message)
               expect(Gitlab::AppLogger).to have_received(:error).with(a_string_matching(error_message))
             end