mat-slide-toggle shouldn't change it's state when I click cancel in confirmation window

Unfortunately you cannot use stopPropagation with mat-slide-toggle, you will need to programmatically set the checked value back to true on the event in your else condition.

else {
    e.source.checked = true;
    console.log("toggle should not change if I click the cancel button")
}

Stackblitz

https://stackblitz.com/edit/angular-79yf7m?embed=1&file=app/slide-toggle-overview-example.ts

You can prevent the toggle mechanism by listening for click event and then event.preventDefault() / event.stopImmediatePropagation(). Then open your dialog and according to the user selection you toggle the toggle yourself or not: toggleReference.toggle().

No need to set it back to true.