Navigation:  Key Concepts > E-Commerce > Delete Test Orders from Magento

Warning:   Use as your own risk.  We do not provide support for this extension.

By default, Magento does not provide a way to delete orders.  However, there is an extension available in the Magento Extension Marketplace called ASPerience DeleteOrders that you might consider installing.

This extension allows you to delete:

Selected sales orders without any invoice/shipment/credit memo => level 1

Selected sales orders and linked invoices, shipments and credit memos => level 2

You can also set the status of orders you want to delete in the configuration section (System > Configuration > Sales > Deletion of Orders).

Extension Author’s Warning:  It’s preferable to delete only the testing orders during the development of your local website.  You take risks if you delete Orders directly in your live Website.

http://www.magentocommerce.com/magento-connect/asperience-deleteorders.html