A stale block is not an invalid block. It satisfied consensus when received, but another valid branch accumulated more chainwork and became active. The stale block's transactions may still confirm elsewhere, while its coinbase reward is not part of the active UTXO set. Stale blocks are a normal consequence of decentralized block discovery and non-zero network propagation time.
A stale block can pass proof-of-work, syntax, transaction and script validation and still disappear from the active chain. Validity answers whether a block is admissible; chain selection answers which valid history the node follows. A valid-but-losing block is therefore categorically different from a consensus-invalid block.
Two miners can find blocks extending the same parent within the network's propagation window. Different peers may briefly learn different tips first, so both branches can be locally active in different parts of the network. The race ends when one branch gains additional accumulated work and nodes converge on it.
Bitcoin nodes compare cumulative chainwork among branches they already consider valid. The branch with more work becomes active; blocks on the losing branch become stale from that node's perspective. Block count alone is not the rule, and an invalid branch cannot win merely by advertising more work.
In modern Bitcoin usage, stale block usually means a once-valid block displaced from the best chain. 'Orphan block' is often used loosely as a synonym, but Bitcoin Core also uses orphan terminology for objects whose parent or inputs are not yet known. Keeping these meanings separate avoids confusing a losing valid block with a block that cannot yet be connected.
Non-coinbase transactions in a stale block are not inherently cancelled. If they are also present in the winning branch they remain confirmed there; otherwise they may return to the mempool if still valid and policy-acceptable. Conflicting transactions in the winning branch can prevent them from returning.
The stale block's coinbase transaction is not part of the active chainstate, so its subsidy and transaction fees are not spendable rewards on the winning history. This gives miners a direct economic incentive to minimize propagation latency and build on the tip most likely to survive.
A stale rate is the fraction of valid discovered blocks that fail to remain in the active chain. It rises when block propagation takes a larger share of the average inter-block interval, or when connectivity and relay performance worsen. It is not a fixed protocol constant and can vary across periods and mining topologies.
BIP152 compact block relay reduces the amount of block data peers must transmit when they already share most transactions. Faster reconstruction and relay reduce the time miners and nodes spend unaware of a new tip, which helps reduce accidental competing-block races. Relay improvements lower risk; they cannot make simultaneous discoveries impossible.
A short reorg is the node-side state transition that can turn previously active blocks into stale blocks. A deliberate double-spend attack may also create a losing branch, but stale blocks by themselves are not evidence of attack. Cause, intent and conflicting transaction history must be examined separately from the chain-selection result.
An operator can compare the block hash with the node's active chain, inspect its parent and height, query chainwork and confirmations, and check whether its transactions later confirmed elsewhere. Explorers can help, but the authoritative answer for a user's security model is the chain accepted by that user's validating node.
For the clearest picture, read this entry together with Block, Chain reorganization, Mining, Orphan Block, Block propagation, Bitcoin. The reverse links also lead from Chain reorganization, Selfish mining, Block propagation, Compact block relay.