diff --git a/backend/internal/api/workspace_handlers.go b/backend/internal/api/workspace_handlers.go
index 0d1ad0f..c1c23c6 100644
--- a/backend/internal/api/workspace_handlers.go
+++ b/backend/internal/api/workspace_handlers.go
@@ -143,24 +143,57 @@ func DeleteWorkspace(db *db.DB) http.HandlerFunc {
 			return
 		}
 
-		workspace, err := db.GetWorkspaceByID(workspaceID)
+		// Check if this is the user's last workspace
+		workspaces, err := db.GetWorkspacesByUserID(userID)
 		if err != nil {
-			http.Error(w, "Workspace not found", http.StatusNotFound)
+			http.Error(w, "Failed to get workspaces", http.StatusInternalServerError)
 			return
 		}
 
-		if workspace.UserID != userID {
-			http.Error(w, "Unauthorized access to workspace", http.StatusForbidden)
+		if len(workspaces) <= 1 {
+			http.Error(w, "Cannot delete the last workspace", http.StatusBadRequest)
 			return
 		}
 
-		if err := db.DeleteWorkspace(workspaceID); err != nil {
+		// Find another workspace to set as last
+		var nextWorkspaceID int
+		for _, ws := range workspaces {
+			if ws.ID != workspaceID {
+				nextWorkspaceID = ws.ID
+				break
+			}
+		}
+
+		// Start transaction
+		tx, err := db.Begin()
+		if err != nil {
+			http.Error(w, "Failed to start transaction", http.StatusInternalServerError)
+			return
+		}
+		defer tx.Rollback()
+
+		// Update last workspace ID first
+		err = db.UpdateLastWorkspaceTx(tx, userID, nextWorkspaceID)
+		if err != nil {
+			http.Error(w, "Failed to update last workspace", http.StatusInternalServerError)
+			return
+		}
+
+		// Delete the workspace
+		err = db.DeleteWorkspaceTx(tx, workspaceID)
+		if err != nil {
 			http.Error(w, "Failed to delete workspace", http.StatusInternalServerError)
 			return
 		}
 
-		w.WriteHeader(http.StatusOK)
-		w.Write([]byte("Workspace deleted successfully"))
+		// Commit transaction
+		if err = tx.Commit(); err != nil {
+			http.Error(w, "Failed to commit transaction", http.StatusInternalServerError)
+			return
+		}
+
+		// Return the next workspace ID in the response so frontend knows where to redirect
+		respondJSON(w, map[string]int{"nextWorkspaceId": nextWorkspaceID})
 	}
 }
 
diff --git a/backend/internal/db/workspaces.go b/backend/internal/db/workspaces.go
index 7fb2038..344e4e2 100644
--- a/backend/internal/db/workspaces.go
+++ b/backend/internal/db/workspaces.go
@@ -1,6 +1,7 @@
 package db
 
 import (
+	"database/sql"
 	"novamd/internal/models"
 )
 
@@ -149,3 +150,13 @@ func (db *DB) DeleteWorkspace(id int) error {
 	_, err := db.Exec("DELETE FROM workspaces WHERE id = ?", id)
 	return err
 }
+
+func (db *DB) DeleteWorkspaceTx(tx *sql.Tx, id int) error {
+	_, err := tx.Exec("DELETE FROM workspaces WHERE id = ?", id)
+	return err
+}
+
+func (db *DB) UpdateLastWorkspaceTx(tx *sql.Tx, userID, workspaceID int) error {
+	_, err := tx.Exec("UPDATE users SET last_workspace_id = ? WHERE id = ?", workspaceID, userID)
+	return err
+}
diff --git a/frontend/src/components/settings/DangerZoneSettings.js b/frontend/src/components/settings/DangerZoneSettings.js
index 8c328e9..2f23517 100644
--- a/frontend/src/components/settings/DangerZoneSettings.js
+++ b/frontend/src/components/settings/DangerZoneSettings.js
@@ -2,14 +2,18 @@ import React, { useState } from 'react';
 import { Box, Button, Title } from '@mantine/core';
 import DeleteWorkspaceModal from '../modals/DeleteWorkspaceModal';
 import { useWorkspace } from '../../contexts/WorkspaceContext';
+import { useModalContext } from '../../contexts/ModalContext';
 
 const DangerZoneSettings = () => {
-  const { currentWorkspace } = useWorkspace();
+  const { currentWorkspace, workspaces, deleteCurrentWorkspace } =
+    useWorkspace();
+  const { setSettingsModalVisible } = useModalContext();
   const [deleteModalOpened, setDeleteModalOpened] = useState(false);
 
-  const handleDelete = () => {
-    // TODO: Implement delete functionality
+  const handleDelete = async () => {
+    await deleteCurrentWorkspace();
     setDeleteModalOpened(false);
+    setSettingsModalVisible(false);
   };
 
   return (
@@ -23,6 +27,12 @@ const DangerZoneSettings = () => {
         variant="light"
         onClick={() => setDeleteModalOpened(true)}
         fullWidth
+        disabled={workspaces.length <= 1}
+        title={
+          workspaces.length <= 1
+            ? 'Cannot delete the last workspace'
+            : 'Delete this workspace'
+        }
       >
         Delete Workspace
       </Button>
diff --git a/frontend/src/contexts/WorkspaceContext.js b/frontend/src/contexts/WorkspaceContext.js
index 2bae145..f7804e2 100644
--- a/frontend/src/contexts/WorkspaceContext.js
+++ b/frontend/src/contexts/WorkspaceContext.js
@@ -12,6 +12,8 @@ import {
   getWorkspace,
   updateWorkspace,
   updateLastWorkspace,
+  deleteWorkspace,
+  listWorkspaces,
 } from '../services/api';
 import { DEFAULT_WORKSPACE_SETTINGS } from '../utils/constants';
 
@@ -19,9 +21,26 @@ const WorkspaceContext = createContext();
 
 export const WorkspaceProvider = ({ children }) => {
   const [currentWorkspace, setCurrentWorkspace] = useState(null);
+  const [workspaces, setWorkspaces] = useState([]);
   const [loading, setLoading] = useState(true);
   const { colorScheme, setColorScheme } = useMantineColorScheme();
 
+  const loadWorkspaces = useCallback(async () => {
+    try {
+      const workspaceList = await listWorkspaces();
+      setWorkspaces(workspaceList);
+      return workspaceList;
+    } catch (error) {
+      console.error('Failed to load workspaces:', error);
+      notifications.show({
+        title: 'Error',
+        message: 'Failed to load workspaces list',
+        color: 'red',
+      });
+      return [];
+    }
+  }, []);
+
   const loadWorkspaceData = useCallback(async (workspaceId) => {
     try {
       const workspace = await getWorkspace(workspaceId);
@@ -37,6 +56,24 @@ export const WorkspaceProvider = ({ children }) => {
     }
   }, []);
 
+  const loadFirstAvailableWorkspace = useCallback(async () => {
+    try {
+      const allWorkspaces = await listWorkspaces();
+      if (allWorkspaces.length > 0) {
+        const firstWorkspace = allWorkspaces[0];
+        await updateLastWorkspace(firstWorkspace.id);
+        await loadWorkspaceData(firstWorkspace.id);
+      }
+    } catch (error) {
+      console.error('Failed to load first available workspace:', error);
+      notifications.show({
+        title: 'Error',
+        message: 'Failed to load workspace',
+        color: 'red',
+      });
+    }
+  }, []);
+
   useEffect(() => {
     const initializeWorkspace = async () => {
       try {
@@ -44,10 +81,12 @@ export const WorkspaceProvider = ({ children }) => {
         if (lastWorkspaceId) {
           await loadWorkspaceData(lastWorkspaceId);
         } else {
-          console.warn('No last workspace found');
+          await loadFirstAvailableWorkspace();
         }
+        await loadWorkspaces();
       } catch (error) {
         console.error('Failed to initialize workspace:', error);
+        await loadFirstAvailableWorkspace();
       } finally {
         setLoading(false);
       }
@@ -61,6 +100,7 @@ export const WorkspaceProvider = ({ children }) => {
       setLoading(true);
       await updateLastWorkspace(workspaceId);
       await loadWorkspaceData(workspaceId);
+      await loadWorkspaces();
     } catch (error) {
       console.error('Failed to switch workspace:', error);
       notifications.show({
@@ -73,6 +113,44 @@ export const WorkspaceProvider = ({ children }) => {
     }
   }, []);
 
+  const deleteCurrentWorkspace = useCallback(async () => {
+    if (!currentWorkspace) return;
+
+    try {
+      const allWorkspaces = await loadWorkspaces();
+      if (allWorkspaces.length <= 1) {
+        notifications.show({
+          title: 'Error',
+          message:
+            'Cannot delete the last workspace. At least one workspace must exist.',
+          color: 'red',
+        });
+        return;
+      }
+
+      // Delete workspace and get the next workspace ID
+      const response = await deleteWorkspace(currentWorkspace.id);
+
+      // Load the new workspace data
+      await loadWorkspaceData(response.nextWorkspaceId);
+
+      notifications.show({
+        title: 'Success',
+        message: 'Workspace deleted successfully',
+        color: 'green',
+      });
+
+      await loadWorkspaces();
+    } catch (error) {
+      console.error('Failed to delete workspace:', error);
+      notifications.show({
+        title: 'Error',
+        message: 'Failed to delete workspace',
+        color: 'red',
+      });
+    }
+  }, [currentWorkspace]);
+
   const updateSettings = useCallback(
     async (newSettings) => {
       if (!currentWorkspace) return;
@@ -89,27 +167,32 @@ export const WorkspaceProvider = ({ children }) => {
         );
         setCurrentWorkspace(response);
         setColorScheme(response.theme);
+        await loadWorkspaces();
       } catch (error) {
         console.error('Failed to save settings:', error);
         throw error;
       }
     },
-    [currentWorkspace]
+    [currentWorkspace, setColorScheme]
   );
 
-  // Update just the color scheme without saving to backend
-  const updateColorScheme = useCallback((newTheme) => {
-    setColorScheme(newTheme);
-  }, []);
+  const updateColorScheme = useCallback(
+    (newTheme) => {
+      setColorScheme(newTheme);
+    },
+    [setColorScheme]
+  );
 
   const value = {
     currentWorkspace,
+    workspaces,
     settings: currentWorkspace || DEFAULT_WORKSPACE_SETTINGS,
     updateSettings,
     loading,
     colorScheme,
     updateColorScheme,
     switchWorkspace,
+    deleteCurrentWorkspace,
   };
 
   return (