diff --git a/src/registrar/fixtures.py b/src/registrar/fixtures.py
index 09ebf2690..5f3562ea2 100644
--- a/src/registrar/fixtures.py
+++ b/src/registrar/fixtures.py
@@ -116,6 +116,10 @@ class DomainApplicationFixture:
             "status": "investigating",
             "organization_name": "Example - Approved",
         },
+        {
+            "status": "withdrawn"
+            "organization_name": "Example - Withdrawn"
+        }
     ]
 
     @classmethod
diff --git a/src/registrar/migrations/0017_alter_domaininvitation_status.py b/src/registrar/migrations/0017_alter_domaininvitation_status.py
new file mode 100644
index 000000000..885ec43ff
--- /dev/null
+++ b/src/registrar/migrations/0017_alter_domaininvitation_status.py
@@ -0,0 +1,23 @@
+# Generated by Django 4.1.6 on 2023-04-13 18:27
+
+from django.db import migrations
+import django_fsm
+
+
+class Migration(migrations.Migration):
+    dependencies = [
+        ("registrar", "0016_domaininvitation"),
+    ]
+
+    operations = [
+        migrations.AlterField(
+            model_name="domaininvitation",
+            name="status",
+            field=django_fsm.FSMField(
+                choices=[("invited", "invited"), ("retrieved", "retrieved")],
+                default="invited",
+                max_length=50,
+                protected=True,
+            ),
+        ),
+    ]
diff --git a/src/registrar/migrations/0018_alter_domainapplication_status.py b/src/registrar/migrations/0018_alter_domainapplication_status.py
new file mode 100644
index 000000000..741f2950e
--- /dev/null
+++ b/src/registrar/migrations/0018_alter_domainapplication_status.py
@@ -0,0 +1,28 @@
+# Generated by Django 4.1.6 on 2023-04-13 18:31
+
+from django.db import migrations
+import django_fsm
+
+
+class Migration(migrations.Migration):
+    dependencies = [
+        ("registrar", "0017_alter_domaininvitation_status"),
+    ]
+
+    operations = [
+        migrations.AlterField(
+            model_name="domainapplication",
+            name="status",
+            field=django_fsm.FSMField(
+                choices=[
+                    ("started", "started"),
+                    ("submitted", "submitted"),
+                    ("investigating", "investigating"),
+                    ("approved", "approved"),
+                    ("Withdrawn", "Withdrawn"),
+                ],
+                default="started",
+                max_length=50,
+            ),
+        ),
+    ]
diff --git a/src/registrar/models/domain_application.py b/src/registrar/models/domain_application.py
index 729cdfe8c..8d1700510 100644
--- a/src/registrar/models/domain_application.py
+++ b/src/registrar/models/domain_application.py
@@ -23,11 +23,13 @@ class DomainApplication(TimeStampedModel):
     SUBMITTED = "submitted"
     INVESTIGATING = "investigating"
     APPROVED = "approved"
+    WITHDRAWN = "Withdrawn"
     STATUS_CHOICES = [
         (STARTED, STARTED),
         (SUBMITTED, SUBMITTED),
         (INVESTIGATING, INVESTIGATING),
         (APPROVED, APPROVED),
+        (WITHDRAWN, WITHDRAWN)
     ]
 
     class StateTerritoryChoices(models.TextChoices):
@@ -505,7 +507,7 @@ class DomainApplication(TimeStampedModel):
         # This is a side-effect of the state transition
         self._send_confirmation_email()
 
-    @transition(field="status", source=[SUBMITTED, INVESTIGATING], target=APPROVED)
+    @transition(field="status", source=[SUBMITTED, INVESTIGATING], target=[APPROVED])
     def approve(self):
         """Approve an application that has been submitted.