The reported behavior is caused by the WPF framework and is not directly related to the RadDiagramControl itself. As I can see in the project that my colleague Peter provided you the drop logic and the canceling of the drag operation are executed in the LeftMouseButtonUp event. This event is never called because when you mouse up outside the window the mouse is not captured by default and the window doesn't know that the mouse is up.
In order to resolve this you can capture the mouse when you start the drag operation and release it again when the drop is executed.
sender, DragRoutedEventArgs e)
sender, System.Windows.Input.MouseButtonEventArgs e)
Please let me know if this helps.
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