How can I cancel or remove an order in Commerce?

To cancel an order you will need to create a cancelled status. You can find these in Commerce -> Configuration -> Statuses. 

First click on the Add a status button at the top and give it a label such as simply "Cancelled" or perhaps something more descriptive to describe the situation. Be sure to set the Order State field to "Cancelled", which will move the order into the cancelled bucket and make sure it's excluded from reports. After clicking save, you'll see the new status in the list.

Then choose where you would like to have the option to cancel an order. The default status "Received" might be a good spot, but you can add this to any status at which point customers may still cancel. In the row for the original status, go to the Actions drop-down and choose Add Status Change. Name the status change (e.g. Cancel) and set the Target Status field to the new "Cancelled" status you created earlier, and finally save it.

You'll see a second status change in the status row. This means you now have the choice to cancel any order that currently has that status. When viewing an order in Commerce -> Orders, the button to cancel any order that is "Received" should now be available.

By adding status change actions to the new Cancel status change, you can automatically send emails to the customer or update third party integrations.

Learn more about statuses in the documentation.

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