diff --git a/packages/vee-validate/src/useForm.ts b/packages/vee-validate/src/useForm.ts
index 86ee30550..aebdcbbcb 100644
--- a/packages/vee-validate/src/useForm.ts
+++ b/packages/vee-validate/src/useForm.ts
@@ -269,8 +269,15 @@ export function useForm<TValues extends Record<string, any> = Record<string, any
       // necessary for fields generated by loops
       watch(
         field.name,
-        newPath => {
+        (newPath, oldPath) => {
           setFieldValue(newPath, valuesByFid[field.fid]);
+          const isSharingName = fields.value.find(f => unref(f.name) === oldPath);
+          // clean up the old path if no other field is sharing that name
+          // #3325
+          if (!isSharingName) {
+            unsetPath(formValues, oldPath);
+            unsetPath(initialValues.value, oldPath);
+          }
         },
         {
           flush: 'post',
@@ -296,6 +303,7 @@ export function useForm<TValues extends Record<string, any> = Record<string, any
     // so remove the field value key immediately
     if (field.idx === -1) {
       // avoid un-setting the value if the field was switched with another that shares the same name
+      // they will be unset once the new field takes over the new name, look at `#registerField()`
       // #3166
       const isSharingName = fields.value.find(f => unref(f.name) === fieldName);
       if (isSharingName) {
diff --git a/packages/vee-validate/tests/Form.spec.ts b/packages/vee-validate/tests/Form.spec.ts
index 8239c4013..f9bd18340 100644
--- a/packages/vee-validate/tests/Form.spec.ts
+++ b/packages/vee-validate/tests/Form.spec.ts
@@ -1988,4 +1988,61 @@ describe('<Form />', () => {
     expect(passwordError.textContent).toBe(errorMessage);
     expect(passwordValue.textContent).toBe(value);
   });
+
+  // #3325
+  test('unsets old path value when array fields are removed', async () => {
+    const onSubmit = jest.fn();
+    mountWithHoc({
+      setup() {
+        const users = ref([
+          { id: 1, name: '111' },
+          { id: 2, name: '222' },
+          { id: 3, name: '333' },
+        ]);
+
+        function remove(idx: number) {
+          users.value.splice(idx, 1);
+        }
+
+        return {
+          onSubmit,
+          users,
+          remove,
+        };
+      },
+      template: `
+      <VForm @submit="onSubmit">
+        <fieldset v-for="(user, idx) in users" :key="user.id">
+          <legend>User #{{ idx }}</legend>
+          <label :for="'name_' + idx">Name</label>
+          <Field :id="'name_' + idx" :name="'users[' + idx + '].name'" />
+          <ErrorMessage :name="'users[' + idx + '].name'" />
+
+          <button class="remove" type="button" @click="remove(idx)">X</button>
+        </fieldset>
+
+        <button class="submit" type="submit">Submit</button>
+      </VForm>
+    `,
+    });
+
+    await flushPromises();
+    const submitBtn = document.querySelector('.submit') as HTMLButtonElement;
+    const inputs = Array.from(document.querySelectorAll('input')) as HTMLInputElement[];
+    const removeBtn = document.querySelectorAll('.remove')[1] as HTMLButtonElement; // remove the second item
+    setValue(inputs[0], '111');
+    setValue(inputs[1], '222');
+    setValue(inputs[2], '333');
+    await flushPromises();
+    removeBtn.click();
+    await flushPromises();
+    (submitBtn as HTMLButtonElement).click();
+    await flushPromises();
+    expect(onSubmit).toHaveBeenCalledWith(
+      expect.objectContaining({
+        users: [{ name: '111' }, { name: '333' }],
+      }),
+      expect.anything()
+    );
+  });
 });