diff --git a/Include/internal/pycore_interp.h b/Include/internal/pycore_interp.h
index a1c1dd0c957230..6ef7079ac6fc4a 100644
--- a/Include/internal/pycore_interp.h
+++ b/Include/internal/pycore_interp.h
@@ -139,6 +139,12 @@ struct _is {
            or the size specified by the THREAD_STACK_SIZE macro. */
         /* Used in Python/thread.c. */
         size_t stacksize;
+
+        /* Linked lists of ThreadHandles for threads created by
+           the threading module.
+        */
+        struct llist_node non_daemon_handles;
+        struct llist_node daemon_handles;
     } threads;
 
     /* Reference to the _PyRuntime global variable. This field exists
diff --git a/Include/internal/pycore_pythread.h b/Include/internal/pycore_pythread.h
index f3f5942444e851..16fa05da85b3cd 100644
--- a/Include/internal/pycore_pythread.h
+++ b/Include/internal/pycore_pythread.h
@@ -95,6 +95,8 @@ extern int _PyThread_at_fork_reinit(PyThread_type_lock *lock);
 extern void _PyThread_AfterFork(struct _pythread_runtime_state *state);
 #endif  /* HAVE_FORK */
 
+extern void _PyThread_DaemonThreadsForceKilled(PyInterpreterState *interp);
+extern void _PyThread_ClearThreadHandles(PyInterpreterState *interp);
 
 // unset: -1 seconds, in nanoseconds
 #define PyThread_UNSET_TIMEOUT ((PyTime_t)(-1 * 1000 * 1000 * 1000))
diff --git a/Lib/test/test_threading.py b/Lib/test/test_threading.py
index 329767aa82e336..d32951a9ae55c0 100644
--- a/Lib/test/test_threading.py
+++ b/Lib/test/test_threading.py
@@ -1171,6 +1171,41 @@ def __del__(self):
         self.assertEqual(out.strip(), b"OK")
         self.assertIn(b"can't create new thread at interpreter shutdown", err)
 
+    @unittest.skipIf(support.Py_GIL_DISABLED, "gh-124149: daemon threads don't force exit")
+    def test_join_force_terminated_daemon_thread_in_finalization(self):
+        # gh-123940: Py_Finalize() forces all daemon threads to exit
+        # immediately (without unwinding the stack) upon acquiring the
+        # GIL. Finalizers that run after this must be able to join the daemon
+        # threads that were forced to exit.
+        code = textwrap.dedent("""
+            import threading
+
+
+            def loop():
+                while True:
+                    pass
+
+
+            class Cycle:
+                def __init__(self):
+                    self.self_ref = self
+                    self.thr = threading.Thread(target=loop, daemon=True)
+                    self.thr.start()
+
+                def __del__(self):
+                    self.thr.join()
+                    print('__del__ called')
+
+            # Cycle holds a reference to itself, which ensures it is cleaned
+            # up during the GC that runs after daemon threads have been
+            # forced to exit during finalization.
+            Cycle()
+        """)
+        rc, out, err = assert_python_ok("-c", code)
+        self.assertEqual(err, b"")
+        self.assertIn(b"__del__ called", out)
+
+
 class ThreadJoinOnShutdown(BaseTestCase):
 
     def _run_and_join(self, script):
diff --git a/Modules/_threadmodule.c b/Modules/_threadmodule.c
index b3ed8e7bc56b9e..25c59a00479df0 100644
--- a/Modules/_threadmodule.c
+++ b/Modules/_threadmodule.c
@@ -30,10 +30,6 @@ typedef struct {
     PyTypeObject *local_type;
     PyTypeObject *local_dummy_type;
     PyTypeObject *thread_handle_type;
-
-    // Linked list of handles to all non-daemon threads created by the
-    // threading module. We wait for these to finish at shutdown.
-    struct llist_node shutdown_handles;
 } thread_module_state;
 
 static inline thread_module_state*
@@ -78,7 +74,8 @@ typedef enum {
 typedef struct {
     struct llist_node node;  // linked list node (see _pythread_runtime_state)
 
-    // linked list node (see thread_module_state)
+    // belongs to either `non_daemon_handles` or `daemon_handles` on
+    // PyInterpreterState
     struct llist_node shutdown_node;
 
     // The `ident`, `os_handle`, `has_os_handle`, and `state` fields are
@@ -143,19 +140,26 @@ ThreadHandle_get_os_handle(ThreadHandle *handle, PyThread_handle_t *os_handle)
 }
 
 static void
-add_to_shutdown_handles(thread_module_state *state, ThreadHandle *handle)
+add_to_shutdown_handles(struct llist_node *shutdown_handles,
+                        ThreadHandle *handle)
 {
     HEAD_LOCK(&_PyRuntime);
-    llist_insert_tail(&state->shutdown_handles, &handle->shutdown_node);
+    llist_insert_tail(shutdown_handles, &handle->shutdown_node);
     HEAD_UNLOCK(&_PyRuntime);
 }
 
-static void
-clear_shutdown_handles(thread_module_state *state)
+// Remove any remaining handles (e.g. if shutdown exited early due to
+// interrupt) so that attempts to unlink the handle after our module state
+// is destroyed do not crash.
+void
+_PyThread_ClearThreadHandles(PyInterpreterState *interp)
 {
     HEAD_LOCK(&_PyRuntime);
     struct llist_node *node;
-    llist_for_each_safe(node, &state->shutdown_handles) {
+    llist_for_each_safe(node, &interp->threads.daemon_handles) {
+        llist_remove(node);
+    }
+    llist_for_each_safe(node, &interp->threads.non_daemon_handles) {
         llist_remove(node);
     }
     HEAD_UNLOCK(&_PyRuntime);
@@ -378,7 +382,7 @@ force_done(ThreadHandle *handle)
 
 static int
 ThreadHandle_start(ThreadHandle *self, PyObject *func, PyObject *args,
-                   PyObject *kwargs)
+                   PyObject *kwargs, struct llist_node *shutdown_handles)
 {
     // Mark the handle as starting to prevent any other threads from doing so
     PyMutex_Lock(&self->mutex);
@@ -390,6 +394,11 @@ ThreadHandle_start(ThreadHandle *self, PyObject *func, PyObject *args,
     self->state = THREAD_HANDLE_STARTING;
     PyMutex_Unlock(&self->mutex);
 
+    // Add the handle before starting the thread to avoid adding a handle
+    // to a thread that has already finished (i.e. if the thread finishes
+    // before the call to `ThreadHandle_start()` below returns).
+    add_to_shutdown_handles(shutdown_handles, self);
+
     // Do all the heavy lifting outside of the mutex. All other operations on
     // the handle should fail since the handle is in the starting state.
 
@@ -441,6 +450,7 @@ ThreadHandle_start(ThreadHandle *self, PyObject *func, PyObject *args,
     return 0;
 
 start_failed:
+    remove_from_shutdown_handles(self);
     _PyOnceFlag_CallOnce(&self->once, (_Py_once_fn_t *)force_done, self);
     return -1;
 }
@@ -1857,8 +1867,8 @@ Return True if daemon threads are allowed in the current interpreter,\n\
 and False otherwise.\n");
 
 static int
-do_start_new_thread(thread_module_state *state, PyObject *func, PyObject *args,
-                    PyObject *kwargs, ThreadHandle *handle, int daemon)
+do_start_new_thread(PyObject *func, PyObject *args, PyObject *kwargs,
+                    ThreadHandle *handle, int daemon)
 {
     PyInterpreterState *interp = _PyInterpreterState_GET();
     if (!_PyInterpreterState_HasFeature(interp, Py_RTFLAGS_THREADS)) {
@@ -1872,17 +1882,12 @@ do_start_new_thread(thread_module_state *state, PyObject *func, PyObject *args,
         return -1;
     }
 
-    if (!daemon) {
-        // Add the handle before starting the thread to avoid adding a handle
-        // to a thread that has already finished (i.e. if the thread finishes
-        // before the call to `ThreadHandle_start()` below returns).
-        add_to_shutdown_handles(state, handle);
+    struct llist_node *shutdown_handles = &interp->threads.non_daemon_handles;
+    if (daemon) {
+        shutdown_handles = &interp->threads.daemon_handles;
     }
 
-    if (ThreadHandle_start(handle, func, args, kwargs) < 0) {
-        if (!daemon) {
-            remove_from_shutdown_handles(handle);
-        }
+    if (ThreadHandle_start(handle, func, args, kwargs, shutdown_handles) < 0) {
         return -1;
     }
 
@@ -1893,7 +1898,6 @@ static PyObject *
 thread_PyThread_start_new_thread(PyObject *module, PyObject *fargs)
 {
     PyObject *func, *args, *kwargs = NULL;
-    thread_module_state *state = get_thread_state(module);
 
     if (!PyArg_UnpackTuple(fargs, "start_new_thread", 2, 3,
                            &func, &args, &kwargs))
@@ -1924,8 +1928,7 @@ thread_PyThread_start_new_thread(PyObject *module, PyObject *fargs)
         return NULL;
     }
 
-    int st =
-        do_start_new_thread(state, func, args, kwargs, handle, /*daemon=*/1);
+    int st = do_start_new_thread(func, args, kwargs, handle, /*daemon=*/1);
     if (st < 0) {
         ThreadHandle_decref(handle);
         return NULL;
@@ -2002,8 +2005,9 @@ thread_PyThread_start_joinable_thread(PyObject *module, PyObject *fargs,
     if (args == NULL) {
         return NULL;
     }
-    int st = do_start_new_thread(state, func, args,
-                                 /*kwargs=*/ NULL, ((PyThreadHandleObject*)hobj)->handle, daemon);
+    int st = do_start_new_thread(
+        func, args,
+        /*kwargs=*/NULL, ((PyThreadHandleObject *)hobj)->handle, daemon);
     Py_DECREF(args);
     if (st < 0) {
         Py_DECREF(hobj);
@@ -2364,7 +2368,7 @@ static PyObject *
 thread_shutdown(PyObject *self, PyObject *args)
 {
     PyThread_ident_t ident = PyThread_get_thread_ident_ex();
-    thread_module_state *state = get_thread_state(self);
+    PyInterpreterState *interp = _PyInterpreterState_GET();
 
     for (;;) {
         ThreadHandle *handle = NULL;
@@ -2372,7 +2376,7 @@ thread_shutdown(PyObject *self, PyObject *args)
         // Find a thread that's not yet finished.
         HEAD_LOCK(&_PyRuntime);
         struct llist_node *node;
-        llist_for_each_safe(node, &state->shutdown_handles) {
+        llist_for_each_safe(node, &interp->threads.non_daemon_handles) {
             ThreadHandle *cur = llist_data(node, ThreadHandle, shutdown_node);
             if (cur->ident != ident) {
                 ThreadHandle_incref(cur);
@@ -2407,6 +2411,30 @@ PyDoc_STRVAR(shutdown_doc,
 \n\
 Wait for all non-daemon threads (other than the calling thread) to stop.");
 
+/* gh-123940: Mark remaining daemon threads as exited so that they may
+ * be joined from finalizers.
+ */
+void
+_PyThread_DaemonThreadsForceKilled(PyInterpreterState *interp)
+{
+    for (;;) {
+        HEAD_LOCK(&_PyRuntime);
+        if (llist_empty(&interp->threads.daemon_handles)) {
+            HEAD_UNLOCK(&_PyRuntime);
+            break;
+        }
+        struct llist_node *node = interp->threads.daemon_handles.next;
+        ThreadHandle *handle = llist_data(node, ThreadHandle, shutdown_node);
+        ThreadHandle_incref(handle);
+        llist_remove(node);
+        HEAD_UNLOCK(&_PyRuntime);
+        // gh-123940: Mark daemon threads as done so that they can be joined
+        // from finalizers.
+        _PyEvent_Notify(&handle->thread_is_exiting);
+        ThreadHandle_decref(handle);
+    }
+}
+
 static PyObject *
 thread__make_thread_handle(PyObject *module, PyObject *identobj)
 {
@@ -2579,8 +2607,6 @@ thread_module_exec(PyObject *module)
         return -1;
     }
 
-    llist_init(&state->shutdown_handles);
-
     return 0;
 }
 
@@ -2606,10 +2632,6 @@ thread_module_clear(PyObject *module)
     Py_CLEAR(state->local_type);
     Py_CLEAR(state->local_dummy_type);
     Py_CLEAR(state->thread_handle_type);
-    // Remove any remaining handles (e.g. if shutdown exited early due to
-    // interrupt) so that attempts to unlink the handle after our module state
-    // is destroyed do not crash.
-    clear_shutdown_handles(state);
     return 0;
 }
 
diff --git a/PCbuild/_freeze_module.vcxproj b/PCbuild/_freeze_module.vcxproj
index 743e6e2a66a8f1..c2894c5eb63c3e 100644
--- a/PCbuild/_freeze_module.vcxproj
+++ b/PCbuild/_freeze_module.vcxproj
@@ -111,6 +111,7 @@
     <ClCompile Include="..\Modules\getpath_noop.c" />
     <ClCompile Include="..\Modules\posixmodule.c" />
     <ClCompile Include="..\Modules\signalmodule.c" />
+    <ClCompile Include="..\Modules\_threadmodule.c" />
     <ClCompile Include="..\Modules\timemodule.c" />
     <ClCompile Include="..\Modules\_tracemalloc.c" />
     <ClCompile Include="..\Modules\_io\_iomodule.c" />
diff --git a/PCbuild/_freeze_module.vcxproj.filters b/PCbuild/_freeze_module.vcxproj.filters
index 0887a47917a931..26975767a339f7 100644
--- a/PCbuild/_freeze_module.vcxproj.filters
+++ b/PCbuild/_freeze_module.vcxproj.filters
@@ -431,6 +431,9 @@
     <ClCompile Include="..\Python\thread.c">
       <Filter>Source Files</Filter>
     </ClCompile>
+    <ClCompile Include="..\Modules\_threadmodule.c">
+      <Filter>Source Files</Filter>
+    </ClCompile>
     <ClCompile Include="..\Modules\timemodule.c">
       <Filter>Source Files</Filter>
     </ClCompile>
diff --git a/Python/pylifecycle.c b/Python/pylifecycle.c
index 27faf723745c21..89bf1aa117ef81 100644
--- a/Python/pylifecycle.c
+++ b/Python/pylifecycle.c
@@ -2040,6 +2040,7 @@ _Py_Finalize(_PyRuntimeState *runtime)
        before we call destructors. */
     PyThreadState *list = _PyThreadState_RemoveExcept(tstate);
     _PyEval_StartTheWorldAll(runtime);
+    _PyThread_DaemonThreadsForceKilled(tstate->interp);
     _PyThreadState_DeleteList(list);
 
     /* At this point no Python code should be running at all.
diff --git a/Python/pystate.c b/Python/pystate.c
index 54caf373e91d6c..24a0b2558c677e 100644
--- a/Python/pystate.c
+++ b/Python/pystate.c
@@ -665,6 +665,8 @@ init_interpreter(PyInterpreterState *interp,
         /* Fix the self-referential, statically initialized fields. */
         interp->dtoa = (struct _dtoa_state)_dtoa_state_INIT(interp);
     }
+    llist_init(&interp->threads.daemon_handles);
+    llist_init(&interp->threads.non_daemon_handles);
 
     interp->_initialized = 1;
     return _PyStatus_OK();
@@ -811,7 +813,7 @@ interpreter_clear(PyInterpreterState *interp, PyThreadState *tstate)
         // XXX Eliminate the need to do this.
         tstate->_status.cleared = 0;
     }
-
+    _PyThread_ClearThreadHandles(interp);
 #ifdef _Py_TIER2
     _PyOptimizerObject *old = _Py_SetOptimizer(interp, NULL);
     assert(old != NULL);
diff --git a/Tools/tsan/suppressions_free_threading.txt b/Tools/tsan/suppressions_free_threading.txt
index e5eb665ae212de..b99597c0421651 100644
--- a/Tools/tsan/suppressions_free_threading.txt
+++ b/Tools/tsan/suppressions_free_threading.txt
@@ -9,6 +9,11 @@
 race:get_allocator_unlocked
 race:set_allocator_unlocked
 
+# Triggered by test_threading.ThreadTests.test_join_force_terminated_daemon_thread_in_finalization
+# https://gist.github.com/mpage/ff1c7094bc8237d98387678d5f52058f
+race_top:_PyThreadState_MustExit
+
+
 ## Free-threaded suppressions
 
 
diff --git a/Tools/tsan/supressions.txt b/Tools/tsan/supressions.txt
index 22ba9d6ba2ab4d..c20ad26e95077e 100644
--- a/Tools/tsan/supressions.txt
+++ b/Tools/tsan/supressions.txt
@@ -3,5 +3,9 @@
 race:get_allocator_unlocked
 race:set_allocator_unlocked
 
+# Triggered by test_threading.ThreadTests.test_join_force_terminated_daemon_thread_in_finalization
+# https://gist.github.com/mpage/ff1c7094bc8237d98387678d5f52058f
+race_top:_PyThreadState_MustExit
+
 # https://gist.github.com/mpage/daaf32b39180c1989572957b943eb665
 thread:pthread_create