diff --git a/kernel/timeout.c b/kernel/timeout.c
index c7e16c1b92a84..e2e2ad39607a2 100644
--- a/kernel/timeout.c
+++ b/kernel/timeout.c
@@ -341,6 +341,7 @@ void z_vrfy_sys_clock_tick_set(uint64_t tick)
 #if CONFIG_SOC_FAMILY_REALTEK_BEE
 /* To support RTK PM */
 extern void sys_clock_only_add_cycle_count(int32_t ticks);
+extern void CPU_DLPS_Exit(void);
 struct _timeout *get_first_timeout(void)
 {
 	return first();
@@ -371,6 +372,7 @@ void sys_clock_restore_tick_and_cycle(void)
 
 void sys_clock_announce_process_timeout(void)
 {
+	/* Update the timeout list: only handle pended ticks. */
 	k_spinlock_key_t key = k_spin_lock(&timeout_lock);
 
 	struct _timeout *t;
@@ -388,11 +390,24 @@ void sys_clock_announce_process_timeout(void)
 
 	pended_ticks = 0;
 
-	/* Separate the handling of pending tick counts and timeout
-	 * callback functions to avoid errors when a timer is started
+	k_spin_unlock(&timeout_lock, key);
+
+	/* Resume NVIC to trigger interrupts that occurred during DLPS.
+	 * ISR might update the timout list, so ensure this is done after updating
+	 * the timeout list.
+	 */
+	__disable_irq();
+	CPU_DLPS_Exit();
+	__enable_irq();
+
+	/* Manually trigger processing of the timeout callback.
+	 * Separating updating pended ticks and timeout
+	 * callback processing to avoid errors if timer behaivor happens
 	 * during the timer callback.
 	 */
 
+ 	key = k_spin_lock(&timeout_lock);
+
 	for (t = first(); (t != NULL) && (t->dticks == 0); t = first()) {
 		remove_timeout(t);
 
diff --git a/soc/arm/realtek_bee/rtl87x2g/power.c b/soc/arm/realtek_bee/rtl87x2g/power.c
index d1889af738d3e..e01eca4bc9a28 100644
--- a/soc/arm/realtek_bee/rtl87x2g/power.c
+++ b/soc/arm/realtek_bee/rtl87x2g/power.c
@@ -161,8 +161,6 @@ void pm_resume_devices_rtk(void)
 				     PM_DEVICE_ACTION_RESUME);
 	}
 
-	CPU_DLPS_Exit();
-
 	num_susp_rtk = 0;
 }
 
@@ -183,7 +181,8 @@ void pm_reusme_systick_and_process_timeout(void)
 	sys_clock_restore_tick_and_cycle();
 	__enable_irq();
 
-	/* Subtract the pended tick from the timeout list and manually trigger a timeout process. */
+	/* Subtract the pended tick from the timeout list, resume NVIC and manually trigger the
+	 * timeout callback process. */
 	sys_clock_announce_process_timeout();
 }
 
diff --git a/tests/boards/rtl8762gn_evb/pm/timeout_wakeup/src/main.c b/tests/boards/rtl8762gn_evb/pm/timeout_wakeup/src/main.c
index e17acf8de128a..b01a47e45658b 100644
--- a/tests/boards/rtl8762gn_evb/pm/timeout_wakeup/src/main.c
+++ b/tests/boards/rtl8762gn_evb/pm/timeout_wakeup/src/main.c
@@ -89,7 +89,7 @@ ZTEST(timeout_wakeup, test_k_thread_wakeup)
 	uint32_t wakeup_count_thread;
 
 	power_get_statistics(&wakeup_count_before_test, &last_wakeup_clk, &last_sleep_clk);
-	while (test_thread_sleep_num <= THREAD_SLEEP_NUMBERS) {
+	while (test_thread_sleep_num < THREAD_SLEEP_NUMBERS) {
 		k_msleep(100);
 		test_thread_sleep_num++;
 	}
@@ -97,8 +97,7 @@ ZTEST(timeout_wakeup, test_k_thread_wakeup)
 	wakeup_count_thread = wakeup_count_after_test - wakeup_count_before_test;
 	TC_PRINT("wakeupCount: %d, last_wakeup_clk:%d, last_sleep_clk:%d\n", wakeup_count_thread,
 	last_wakeup_clk, last_sleep_clk);
-	zassert_true(wakeup_count_thread <= THREAD_SLEEP_NUMBERS + 1 && wakeup_count_thread >=
-		THREAD_SLEEP_NUMBERS - 1, "test_k_timer_wakeup failed, wakeup Count: %d\n",
+	zassert_true(wakeup_count_thread == THREAD_SLEEP_NUMBERS, "test_k_timer_wakeup failed, wakeup Count: %d\n",
 		wakeup_count_thread);
 
 }
@@ -152,10 +151,6 @@ ZTEST(timeout_wakeup, test_triggered_work_wakeup)
 	tag2 = k_uptime_get();
 	time_diff = tag2-tag1;
 	LOG_INF("after dlps!");/*check log time stamp*/
-	zassert_true(time_diff >= TRIGGERED_WORK_NUMBERS*100 && time_diff <=
-			TRIGGERED_WORK_NUMBERS * 100 + 1020,
-			"k_uptime_get is not accurate after dlps! time diff (ms) is %lld",
-			time_diff);
 	power_get_statistics(&wakeup_count_after_test, &last_wakeup_clk, &last_sleep_clk);
 	wakeup_count_triggered_work = wakeup_count_after_test - wakeup_count_before_test;
 	TC_PRINT("wakeupCount: %d, last_wakeup_clk:%d, last_sleep_clk:%d\n",
@@ -163,6 +158,10 @@ ZTEST(timeout_wakeup, test_triggered_work_wakeup)
 	zassert_true(wakeup_count_triggered_work <= TRIGGERED_WORK_NUMBERS + 1
 		&& wakeup_count_triggered_work >= TRIGGERED_WORK_NUMBERS - 1,
 		"test_k_timer_wakeup failed, wakeup Count: %d\n", wakeup_count_triggered_work);
+	zassert_true(time_diff >= TRIGGERED_WORK_NUMBERS*100 && time_diff <=
+			TRIGGERED_WORK_NUMBERS * 100 + 1400,
+			"k_uptime_get is not accurate after dlps! time diff (ms) is %lld",
+			time_diff);
 }
 
 void teardown_fn(void *data)