diff --git a/drivers/timer/Kconfig.nrf_grtc b/drivers/timer/Kconfig.nrf_grtc
index 082c15333dcb1..24534ae3f95cc 100644
--- a/drivers/timer/Kconfig.nrf_grtc
+++ b/drivers/timer/Kconfig.nrf_grtc
@@ -56,4 +56,29 @@ config NRF_GRTC_TIMER_AUTO_KEEP_ALIVE
 	  This feature prevents the SYSCOUNTER from sleeping when any core is in
 	  active state.
 
+if NRF_GRTC_START_SYSCOUNTER
+
+choice NRF_GRTC_TIMER_SOURCE
+	prompt "nRF GRTC clock source"
+	# Default to LFLPRC if CLOCK_CONTROL_NRF_K32SRC_RC for backwards compatibility
+	default NRF_GRTC_TIMER_SOURCE_LFLPRC if CLOCK_CONTROL_NRF_K32SRC_RC
+	# Default to LFXO if present as this allows GRTC to run in SYSTEM OFF
+	default NRF_GRTC_TIMER_SOURCE_LFXO
+	# Default to SYSTEM_LFCLK if LFXO is not present
+	default NRF_GRTC_TIMER_SOURCE_SYSTEM_LFCLK
+
+config NRF_GRTC_TIMER_SOURCE_LFXO
+	bool "Use Low Frequency XO as clock source"
+	depends on $(dt_nodelabel_enabled,lfxo)
+
+config NRF_GRTC_TIMER_SOURCE_SYSTEM_LFCLK
+	bool "Use System Low Frequency clock as clock source"
+
+config NRF_GRTC_TIMER_SOURCE_LFLPRC
+	bool "Use Low Frequency Low Power RC as clock source"
+
+endchoice # NRF_GRTC_TIMER_SOURCE
+
+endif # NRF_GRTC_START_SYSCOUNTER
+
 endif # NRF_GRTC_TIMER
diff --git a/drivers/timer/nrf_grtc_timer.c b/drivers/timer/nrf_grtc_timer.c
index b0593e3bd135e..22aed43d8e477 100644
--- a/drivers/timer/nrf_grtc_timer.c
+++ b/drivers/timer/nrf_grtc_timer.c
@@ -477,13 +477,14 @@ static int sys_clock_driver_init(void)
 #endif
 
 #if defined(CONFIG_NRF_GRTC_TIMER_CLOCK_MANAGEMENT) && NRF_GRTC_HAS_CLKSEL
-#if defined(CONFIG_CLOCK_CONTROL_NRF_K32SRC_RC)
+#if defined(CONFIG_NRF_GRTC_TIMER_SOURCE_LFLPRC)
 	/* Switch to LFPRC as the low-frequency clock source. */
 	nrfx_grtc_clock_source_set(NRF_GRTC_CLKSEL_LFLPRC);
-#elif DT_NODE_HAS_STATUS_OKAY(DT_NODELABEL(lfxo))
+#elif defined(CONFIG_NRF_GRTC_TIMER_SOURCE_LFXO)
 	/* Switch to LFXO as the low-frequency clock source. */
 	nrfx_grtc_clock_source_set(NRF_GRTC_CLKSEL_LFXO);
 #else
+	/* Use LFCLK as the low-frequency clock source. */
 	nrfx_grtc_clock_source_set(NRF_GRTC_CLKSEL_LFCLK);
 #endif
 #endif