diff --git a/kernel/time/posix-timers.c b/kernel/time/posix-timers.c
index da04ed42bf82..db62cfac169d 100644
--- a/kernel/time/posix-timers.c
+++ b/kernel/time/posix-timers.c
@@ -299,6 +299,8 @@ static bool common_hrtimer_rearm(struct k_itimer *timr)
 
 static bool __posixtimer_deliver_signal(struct kernel_siginfo *info, struct k_itimer *timr)
 {
+	bool queued;
+
 	guard(spinlock)(&timr->it_lock);
 
 	/*
@@ -312,12 +314,18 @@ static bool __posixtimer_deliver_signal(struct kernel_siginfo *info, struct k_it
 	if (!timr->it_interval || WARN_ON_ONCE(timr->it_status != POSIX_TIMER_REQUEUE_PENDING))
 		return true;
 
-	timr->kclock->timer_rearm(timr);
-	timr->it_status = POSIX_TIMER_ARMED;
+	/* timer_rearm() updates timr::it_overrun */
+	queued = timr->kclock->timer_rearm(timr);
+
 	timr->it_overrun_last = timr->it_overrun;
 	timr->it_overrun = -1LL;
 	++timr->it_signal_seq;
 	info->si_overrun = timer_overrun_to_int(timr);
+
+	if (queued)
+		timr->it_status = POSIX_TIMER_ARMED;
+	else
+		posix_timer_queue_signal(timr);
 	return true;
 }
 
@@ -905,9 +913,13 @@ int common_timer_set(struct k_itimer *timr, int flags,
 		expires = timens_ktime_to_host(timr->it_clock, expires);
 	sigev_none = timr->it_sigev_notify == SIGEV_NONE;
 
-	kc->timer_arm(timr, expires, flags & TIMER_ABSTIME, sigev_none);
-	if (!sigev_none)
-		timr->it_status = POSIX_TIMER_ARMED;
+	if (kc->timer_arm(timr, expires, flags & TIMER_ABSTIME, sigev_none)) {
+		if (!sigev_none)
+			timr->it_status = POSIX_TIMER_ARMED;
+	} else {
+		/* Timer was already expired, queue the signal */
+		posix_timer_queue_signal(timr);
+	}
 	return 0;
 }