diff --git a/app/services/labels/promote_service.rb b/app/services/labels/promote_service.rb
index 997d247be467d6a06da55da21b8c0b7958c5e0b6..74a85e5c9f08ca0244fa7c8974b82c0ab14d3566 100644
--- a/app/services/labels/promote_service.rb
+++ b/app/services/labels/promote_service.rb
@@ -13,6 +13,7 @@ module Labels
           update_issuables(new_label, batched_ids)
           update_issue_board_lists(new_label, batched_ids)
           update_priorities(new_label, batched_ids)
+          subscribe_users(new_label, batched_ids)
           # Order is important, project labels need to be last
           update_project_labels(batched_ids)
         end
@@ -26,6 +27,15 @@ module Labels
 
     private
 
+    def subscribe_users(new_label, label_ids)
+      # users can be subscribed to multiple labels that will be merged into the group one
+      # we want to keep only one subscription / user
+      ids_to_update = Subscription.where(subscribable_id: label_ids, subscribable_type: 'Label')
+        .group(:user_id)
+        .pluck('MAX(id)')
+      Subscription.where(id: ids_to_update).update_all(subscribable_id: new_label.id)
+    end
+
     def label_ids_for_merge(new_label)
       LabelsFinder
         .new(current_user, title: new_label.title, group_id: project.group.id)
@@ -53,7 +63,7 @@ module Labels
     end
 
     def update_project_labels(label_ids)
-      Label.where(id: label_ids).delete_all
+      Label.where(id: label_ids).destroy_all
     end
 
     def clone_label_to_group_label(label)
diff --git a/changelogs/unreleased/37199-labels-fix.yml b/changelogs/unreleased/37199-labels-fix.yml
new file mode 100644
index 0000000000000000000000000000000000000000..bd70babb73d21970f874da9dbbeeab0f31e2593e
--- /dev/null
+++ b/changelogs/unreleased/37199-labels-fix.yml
@@ -0,0 +1,5 @@
+---
+title: Keep subscribers when promoting labels to group labels
+merge_request:
+author:
+type: fixed
diff --git a/spec/services/labels/promote_service_spec.rb b/spec/services/labels/promote_service_spec.rb
index 8809b2821271350175a6d88f8e689ba286cd36a9..aa9aba6bdfffe06f1cc04c7163ef9b83148924d9 100644
--- a/spec/services/labels/promote_service_spec.rb
+++ b/spec/services/labels/promote_service_spec.rb
@@ -85,6 +85,19 @@ describe Labels::PromoteService do
           change(project_3.labels, :count).by(-1)
       end
 
+      it 'keeps users\' subscriptions' do
+        user2 = create(:user)
+        project_label_1_1.subscriptions.create(user: user, subscribed: true)
+        project_label_2_1.subscriptions.create(user: user, subscribed: true)
+        project_label_3_2.subscriptions.create(user: user, subscribed: true)
+        project_label_2_1.subscriptions.create(user: user2, subscribed: true)
+
+        expect { service.execute(project_label_1_1) }.to change { Subscription.count }.from(4).to(3)
+
+        expect(new_label.subscribed?(user)).to be_truthy
+        expect(new_label.subscribed?(user2)).to be_truthy
+      end
+
       it 'recreates priorities' do
         service.execute(project_label_1_1)