diff --git a/module/zfs/dmu_recv.c b/module/zfs/dmu_recv.c
index 45c7af2bd..66ec6c1b0 100644
--- a/module/zfs/dmu_recv.c
+++ b/module/zfs/dmu_recv.c
@@ -1018,6 +1018,22 @@ dmu_recv_begin_sync(void *arg, dmu_tx_t *tx)
 	dmu_buf_will_dirty(newds->ds_dbuf, tx);
 	dsl_dataset_phys(newds)->ds_flags |= DS_FLAG_INCONSISTENT;
 
+	/*
+	 * When receiving, we refuse to accept streams that are missing the
+	 * large block feature flag if the large block is already active
+	 * (see ZFS_ERR_STREAM_LARGE_BLOCK_MISMATCH). To prevent this
+	 * check from being spuriously triggered, we always activate
+	 * the large block feature if the feature flag is present in the
+	 * stream.  This covers the case where the sending side has the feature
+	 * active, but has since deleted the file containing large blocks.
+	 */
+	if (featureflags & DMU_BACKUP_FEATURE_LARGE_BLOCKS &&
+	    !dsl_dataset_feature_is_active(newds, SPA_FEATURE_LARGE_BLOCKS)) {
+		dsl_dataset_activate_feature(newds->ds_object,
+		    SPA_FEATURE_LARGE_BLOCKS, (void *)B_TRUE, tx);
+		newds->ds_feature[SPA_FEATURE_LARGE_BLOCKS] = (void *)B_TRUE;
+	}
+
 	/*
 	 * Activate longname feature if received
 	 */
diff --git a/tests/runfiles/common.run b/tests/runfiles/common.run
index 90b8c0a31..62c3cb0c0 100644
--- a/tests/runfiles/common.run
+++ b/tests/runfiles/common.run
@@ -997,6 +997,7 @@ tests = ['recv_dedup', 'recv_dedup_encrypted_zvol', 'rsend_001_pos',
     'send_freeobjects', 'send_realloc_files', 'send_realloc_encrypted_files',
     'send_spill_block', 'send_holds', 'send_hole_birth', 'send_mixed_raw',
     'send-wR_encrypted_zvol', 'send_partial_dataset', 'send_invalid',
+    'send_large_blocks_incremental', 'send_large_blocks_initial',
     'send_doall', 'send_raw_spill_block', 'send_raw_ashift',
     'send_raw_large_blocks', 'send_leak_keymaps']
 tags = ['functional', 'rsend']
diff --git a/tests/zfs-tests/tests/Makefile.am b/tests/zfs-tests/tests/Makefile.am
index ba1c9c4ee..9b298a374 100644
--- a/tests/zfs-tests/tests/Makefile.am
+++ b/tests/zfs-tests/tests/Makefile.am
@@ -2060,6 +2060,8 @@ nobase_dist_datadir_zfs_tests_tests_SCRIPTS += \
 	functional/rsend/send_holds.ksh \
 	functional/rsend/send_hole_birth.ksh \
 	functional/rsend/send_invalid.ksh \
+	functional/rsend/send_large_blocks_incremental.ksh \
+	functional/rsend/send_large_blocks_initial.ksh \
 	functional/rsend/send_leak_keymaps.ksh \
 	functional/rsend/send-L_toggle.ksh \
 	functional/rsend/send_mixed_raw.ksh \
diff --git a/tests/zfs-tests/tests/functional/rsend/send_large_blocks_incremental.ksh b/tests/zfs-tests/tests/functional/rsend/send_large_blocks_incremental.ksh
new file mode 100755
index 000000000..eff7db7cf
--- /dev/null
+++ b/tests/zfs-tests/tests/functional/rsend/send_large_blocks_incremental.ksh
@@ -0,0 +1,83 @@
+#!/bin/ksh -p
+# SPDX-License-Identifier: CDDL-1.0
+
+#
+# This file and its contents are supplied under the terms of the
+# Common Development and Distribution License ("CDDL"), version 1.0.
+# You may only use this file in accordance with the terms of version
+# 1.0 of the CDDL.
+#
+# A full copy of the text of the CDDL should have accompanied this
+# source.  A copy of the CDDL is also available via the Internet at
+# http://www.illumos.org/license/CDDL.
+#
+
+#
+# Copyright (c) 2026 by Austin Wise. All rights reserved.
+#
+
+. $STF_SUITE/tests/functional/rsend/rsend.kshlib
+. $STF_SUITE/include/properties.shlib
+
+#
+# Description:
+#   Verifies that an incremental receive activates the large block feature when the stream was sent
+#   from a dataset whose large block feature was activated.
+#
+# Strategy:
+#   1. Create a dataset with 1MB recordsize.
+#   2. Create a snapshot at where the feature is inactive.
+#   3. Create and delete a large file to activate the large_blocks feature.
+#   4. Create a snapshot where the feature is active.
+#   5. Send the initial snapshot to a second dataset, where the large_blocks feature remains inactive.
+#   6. Send the second snapshot to the dataset incrementally, which should activate the large_blocks feature.
+#
+
+verify_runnable "both"
+
+log_assert "Verify incremental receive handles inactive large_blocks feature correctly."
+
+function cleanup
+{
+	cleanup_pool $POOL
+	cleanup_pool $POOL2
+}
+log_onexit cleanup
+
+function assert_feature_state {
+	typeset pool=$1
+	typeset expected_state=$2
+
+	typeset actual_state=$(zpool get -H -o value feature@large_blocks $pool)
+	log_note "Zpool $pool feature@large_blocks=$actual_state"
+	if [[ "$actual_state" != "$expected_state" ]]; then
+		log_fail "pool $pool feature@large_blocks=$actual_state (expected '$expected_state')"
+	fi
+}
+
+typeset srcfs=$POOL/src
+typeset destfs=$POOL2/dest
+
+# Create a dataset with a large recordsize (1MB) where the feature is inactive in the initial snapshot
+# but active in a later snapshots.
+log_must zfs create -o recordsize=1M $srcfs
+typeset mntpnt=$(get_prop mountpoint $srcfs)
+log_must zfs snapshot $srcfs@feature-inactive
+log_must dd if=/dev/urandom of=$mntpnt/big.bin bs=1M count=1
+log_must zpool sync $POOL
+log_must rm $mntpnt/big.bin
+log_must zfs snapshot $srcfs@feature-active
+
+# Assert initial state of pools
+assert_feature_state $POOL "active"
+assert_feature_state $POOL2 "enabled"
+
+# Initial send does not activate feature.
+log_must eval "zfs send -p -L $srcfs@feature-inactive | zfs receive $destfs"
+assert_feature_state $POOL2 "enabled"
+
+# Incremental send activates feature.
+log_must eval "zfs send -L -i $srcfs@feature-inactive $srcfs@feature-active | zfs receive $destfs"
+assert_feature_state $POOL2 "active"
+
+log_pass "Feature activation propagated successfully."
diff --git a/tests/zfs-tests/tests/functional/rsend/send_large_blocks_initial.ksh b/tests/zfs-tests/tests/functional/rsend/send_large_blocks_initial.ksh
new file mode 100755
index 000000000..19f06d106
--- /dev/null
+++ b/tests/zfs-tests/tests/functional/rsend/send_large_blocks_initial.ksh
@@ -0,0 +1,86 @@
+#!/bin/ksh -p
+# SPDX-License-Identifier: CDDL-1.0
+
+#
+# This file and its contents are supplied under the terms of the
+# Common Development and Distribution License ("CDDL"), version 1.0.
+# You may only use this file in accordance with the terms of version
+# 1.0 of the CDDL.
+#
+# A full copy of the text of the CDDL should have accompanied this
+# source.  A copy of the CDDL is also available via the Internet at
+# http://www.illumos.org/license/CDDL.
+#
+
+#
+# Copyright (c) 2026 by Austin Wise. All rights reserved.
+#
+
+. $STF_SUITE/tests/functional/rsend/rsend.kshlib
+. $STF_SUITE/include/properties.shlib
+
+#
+# Description:
+#   Verifies that creating a dataset from a send stream propagates the activation of the large blocks
+#   feature, even if the send stream contains no large blocks.
+#	Regression test for https://github.com/openzfs/zfs/issues/18101
+#
+# Strategy:
+#   1. Create a dataset with 1MB recordsize.
+#   2. Create and delete a large file to activate the large_blocks feature.
+#   3. Send a full stream to a second dataset.
+#   4. Send an incremental send back to the original dataset.
+#
+
+verify_runnable "both"
+
+log_assert "Verify incremental receive handles inactive large_blocks feature correctly."
+
+function cleanup
+{
+	cleanup_pool $POOL
+	cleanup_pool $POOL2
+}
+log_onexit cleanup
+
+function assert_feature_state {
+	typeset pool=$1
+	typeset expected_state=$2
+
+	typeset actual_state=$(zpool get -H -o value feature@large_blocks $pool)
+	log_note "Zpool $pool feature@large_blocks=$actual_state"
+	if [[ "$actual_state" != "$expected_state" ]]; then
+		log_fail "pool $pool feature@large_blocks=$actual_state (expected '$expected_state')"
+	fi
+}
+
+typeset repro=$POOL/repro
+typeset second=$POOL2/second
+
+# Create a dataset with a large recordsize (1MB)
+log_must zfs create -o recordsize=1M $repro
+typeset mntpnt=$(get_prop mountpoint $repro)
+
+# Activate the large_blocks feature by creating a large file, then delete it
+# This leaves the feature 'active' on the dataset level even though large blocks no longer exist.
+log_must dd if=/dev/urandom of=$mntpnt/big.bin bs=1M count=1
+log_must zpool sync $POOL
+log_must rm $mntpnt/big.bin
+
+# Assert initial state of pools
+assert_feature_state $POOL "active"
+assert_feature_state $POOL2 "enabled"
+
+# Create initial snapshot and send to 'second' dataset.
+# The send stream will have the large blocks feature flag active but not actually contain any large blocks.
+log_must zfs snapshot $repro@initial
+log_must eval "zfs send -p -L $repro@initial | zfs receive $second"
+assert_feature_state $POOL2 "active"
+
+# Send an incremental stream back to the original dataset.
+# The send stream should have the large_blocks feature flag despite no large blocks ever being
+# born in the 'second' dataset.
+log_must zfs snapshot $second@second
+log_must eval "zfs send -L -i $second@initial $second@second | zfs receive -F $repro"
+
+log_pass "Feature activation propagated successfully."