diff --git a/execution_engine_testing/tests/src/test/system_contracts/auction/bids.rs b/execution_engine_testing/tests/src/test/system_contracts/auction/bids.rs
index 8597725f3f..35137984cc 100644
--- a/execution_engine_testing/tests/src/test/system_contracts/auction/bids.rs
+++ b/execution_engine_testing/tests/src/test/system_contracts/auction/bids.rs
@@ -4478,7 +4478,7 @@ fn should_transfer_validator_bid() {
             ARG_AMOUNT => U512::from(SYSTEM_TRANSFER_AMOUNT)
         },
     )
-        .build();
+    .build();
 
     let validator_1_fund_request = ExecuteRequestBuilder::standard(
         *DEFAULT_ACCOUNT_ADDR,
@@ -4488,7 +4488,7 @@ fn should_transfer_validator_bid() {
             ARG_AMOUNT => U512::from(TRANSFER_AMOUNT)
         },
     )
-        .build();
+    .build();
 
     let validator_2_fund_request = ExecuteRequestBuilder::standard(
         *DEFAULT_ACCOUNT_ADDR,
@@ -4498,7 +4498,7 @@ fn should_transfer_validator_bid() {
             ARG_AMOUNT => U512::from(TRANSFER_AMOUNT)
         },
     )
-        .build();
+    .build();
 
     let delegator_1_fund_request = ExecuteRequestBuilder::standard(
         *DEFAULT_ACCOUNT_ADDR,
@@ -4508,7 +4508,7 @@ fn should_transfer_validator_bid() {
             ARG_AMOUNT => U512::from(TRANSFER_AMOUNT)
         },
     )
-        .build();
+    .build();
 
     let delegator_2_fund_request = ExecuteRequestBuilder::standard(
         *DEFAULT_ACCOUNT_ADDR,
@@ -4518,7 +4518,7 @@ fn should_transfer_validator_bid() {
             ARG_AMOUNT => U512::from(TRANSFER_AMOUNT)
         },
     )
-        .build();
+    .build();
 
     let validator_1_add_bid_request = ExecuteRequestBuilder::standard(
         *NON_FOUNDER_VALIDATOR_1_ADDR,
@@ -4529,7 +4529,7 @@ fn should_transfer_validator_bid() {
             ARG_DELEGATION_RATE => ADD_BID_DELEGATION_RATE_1,
         },
     )
-        .build();
+    .build();
 
     let delegator_1_validator_1_delegate_request = ExecuteRequestBuilder::standard(
         *BID_ACCOUNT_1_ADDR,
@@ -4540,7 +4540,7 @@ fn should_transfer_validator_bid() {
             ARG_DELEGATOR => BID_ACCOUNT_1_PK.clone(),
         },
     )
-        .build();
+    .build();
 
     let delegator_2_validator_1_delegate_request = ExecuteRequestBuilder::standard(
         *BID_ACCOUNT_2_ADDR,
@@ -4551,7 +4551,7 @@ fn should_transfer_validator_bid() {
             ARG_DELEGATOR => BID_ACCOUNT_2_PK.clone(),
         },
     )
-        .build();
+    .build();
 
     let post_genesis_requests = vec![
         system_fund_request,
@@ -4576,7 +4576,9 @@ fn should_transfer_validator_bid() {
 
     let bids = builder.get_bids();
     assert_eq!(bids.len(), 3);
-    assert!(bids.validator_bid(&NON_FOUNDER_VALIDATOR_2_PK.clone()).is_none());
+    assert!(bids
+        .validator_bid(&NON_FOUNDER_VALIDATOR_2_PK.clone())
+        .is_none());
 
     let validator_1_transfer_request = ExecuteRequestBuilder::standard(
         *NON_FOUNDER_VALIDATOR_1_ADDR,
@@ -4586,21 +4588,29 @@ fn should_transfer_validator_bid() {
             ARG_NEW_VALIDATOR => NON_FOUNDER_VALIDATOR_2_PK.clone()
         },
     )
-        .build();
+    .build();
 
-    builder.exec(validator_1_transfer_request).commit().expect_success();
+    builder
+        .exec(validator_1_transfer_request)
+        .commit()
+        .expect_success();
 
     let bids = builder.get_bids();
     assert_eq!(bids.len(), 3);
-    let validator_bid = bids.validator_bid(&NON_FOUNDER_VALIDATOR_2_PK.clone()).unwrap();
+    let validator_bid = bids
+        .validator_bid(&NON_FOUNDER_VALIDATOR_2_PK.clone())
+        .unwrap();
     assert_eq!(
         builder.get_purse_balance(*validator_bid.bonding_purse()),
         U512::from(ADD_BID_AMOUNT_1)
     );
-    assert!(bids.validator_bid(&NON_FOUNDER_VALIDATOR_1_PK.clone()).is_none());
+    assert!(bids
+        .validator_bid(&NON_FOUNDER_VALIDATOR_1_PK.clone())
+        .is_none());
 
     assert!(bids
-        .delegators_by_validator_public_key(&NON_FOUNDER_VALIDATOR_1_PK).is_none());
+        .delegators_by_validator_public_key(&NON_FOUNDER_VALIDATOR_1_PK)
+        .is_none());
     let delegators = bids
         .delegators_by_validator_public_key(&NON_FOUNDER_VALIDATOR_2_PK)
         .expect("should have delegators");
diff --git a/smart_contracts/contracts/client/transfer_validator/src/main.rs b/smart_contracts/contracts/client/transfer_validator/src/main.rs
index 0382910525..eb8d079b62 100644
--- a/smart_contracts/contracts/client/transfer_validator/src/main.rs
+++ b/smart_contracts/contracts/client/transfer_validator/src/main.rs
@@ -4,24 +4,26 @@
 extern crate alloc;
 
 use casper_contract::contract_api::{runtime, system};
-use casper_types::{runtime_args, system::auction, PublicKey, U512};
-
-const ARG_VALIDATOR: &str = "validator";
-const ARG_NEW_VALIDATOR: &str = "new_validator";
+use casper_types::{
+    runtime_args,
+    system::auction::{ARG_NEW_VALIDATOR, ARG_VALIDATOR, METHOD_TRANSFER_VALIDATOR},
+    PublicKey,
+};
 
 fn transfer_validator(validator: PublicKey, new_validator: PublicKey) {
     let contract_hash = system::get_auction();
     let args = runtime_args! {
-        auction::ARG_VALIDATOR => validator,
-        auction::ARG_NEW_VALIDATOR => new_validator
+        ARG_VALIDATOR => validator,
+        ARG_NEW_VALIDATOR => new_validator
     };
-    runtime::call_contract::<()>(contract_hash, auction::METHOD_TRANSFER_VALIDATOR, args);
+    runtime::call_contract::<()>(contract_hash, METHOD_TRANSFER_VALIDATOR, args);
 }
 
 // Transfer validator.
 //
-// Accepts current validator's public key and new validator's public key
-// where the existing `ValidatorBid` and all related delegators should be transferred.
+// Accepts current validator's public key and new validator's public key.
+// Updates existing validator bid and all related delegator bids with
+// the new validator's public key.
 #[no_mangle]
 pub extern "C" fn call() {
     let validator = runtime::get_named_arg(ARG_VALIDATOR);
diff --git a/storage/src/system/auction.rs b/storage/src/system/auction.rs
index da304a1b7d..383f350237 100644
--- a/storage/src/system/auction.rs
+++ b/storage/src/system/auction.rs
@@ -700,8 +700,10 @@ pub trait Auction:
         }
     }
 
-    /// Transfers a `ValidatorBid` and all related delegators from one validator public key to another.
+    /// Updates a `ValidatorBid` and all related delegator bids to use a new validator public key.
     ///
+    /// This in effect "transfers" a validator along with its stake and all delegators
+    /// from one public key to another.
     /// This method can only be called by the existing validator.
     ///
     /// The arguments are the existing validator's key and the new validator's key.
@@ -719,16 +721,47 @@ pub trait Auction:
         }
 
         // verify that a bid for existing validator exists
-        let validator_addr = BidAddr::from(validator_public_key.clone());
-        let validator_bid = read_validator_bid(self, &validator_addr.into())?;
+        let validator_bid_addr = BidAddr::from(validator_public_key.clone());
+        let mut validator_bid = read_validator_bid(self, &validator_bid_addr.into())?;
 
         // verify that a bid for new validator does not exist yet
-        let new_validator_addr = BidAddr::from(new_validator_public_key.clone());
-        if self.read_bid(&new_validator_addr.into())?.is_some() {
+        let new_validator_bid_addr = BidAddr::from(new_validator_public_key.clone());
+        if self.read_bid(&new_validator_bid_addr.into())?.is_some() {
             return Err(Error::TransferValidatorBid);
         }
 
-        todo!();
+        debug!("transferring validator bid from {validator_bid_addr} to {new_validator_bid_addr}");
+
+        validator_bid.with_validator_public_key(new_validator_public_key.clone());
+        self.write_bid(
+            new_validator_bid_addr.into(),
+            BidKind::Validator(validator_bid),
+        )?;
+
+        debug!("pruning validator bid {}", validator_bid_addr);
+        self.prune_bid(validator_bid_addr);
+
+        debug!("transferring delegator bids from validator {validator_bid_addr} to {new_validator_bid_addr}");
+        let delegators = read_delegator_bids(self, &validator_public_key)?;
+        for mut delegator in delegators {
+            let delegator_public_key = delegator.delegator_public_key().clone();
+            let delegator_bid_addr =
+                BidAddr::new_from_public_keys(&validator_public_key, Some(&delegator_public_key));
+
+            delegator.with_validator_public_key(new_validator_public_key.clone());
+            let new_delegator_bid_addr = BidAddr::new_from_public_keys(
+                &new_validator_public_key,
+                Some(&delegator_public_key),
+            );
+
+            self.write_bid(
+                new_delegator_bid_addr.into(),
+                BidKind::Delegator(Box::from(delegator)),
+            )?;
+
+            debug!("pruning delegator bid {}", delegator_bid_addr);
+            self.prune_bid(delegator_bid_addr);
+        }
 
         Ok(())
     }
diff --git a/types/src/system/auction/delegator.rs b/types/src/system/auction/delegator.rs
index ff672353ba..39652beebe 100644
--- a/types/src/system/auction/delegator.rs
+++ b/types/src/system/auction/delegator.rs
@@ -187,6 +187,12 @@ impl Delegator {
             vesting_schedule,
         }
     }
+
+    /// Sets validator public key
+    pub fn with_validator_public_key(&mut self, validator_public_key: PublicKey) -> &mut Self {
+        self.validator_public_key = validator_public_key;
+        self
+    }
 }
 
 impl CLTyped for Delegator {
diff --git a/types/src/system/auction/validator_bid.rs b/types/src/system/auction/validator_bid.rs
index a90b725b6e..57a096c6bd 100644
--- a/types/src/system/auction/validator_bid.rs
+++ b/types/src/system/auction/validator_bid.rs
@@ -225,6 +225,12 @@ impl ValidatorBid {
         self.inactive = true;
         true
     }
+
+    /// Sets validator public key
+    pub fn with_validator_public_key(&mut self, validator_public_key: PublicKey) -> &mut Self {
+        self.validator_public_key = validator_public_key;
+        self
+    }
 }
 
 impl CLTyped for ValidatorBid {