diff --git a/dev/load-test/test-recipes/README-rapid-burst.md b/dev/load-test/test-recipes/README-rapid-burst.md
index ea661b8e5..e8e26ac0b 100644
--- a/dev/load-test/test-recipes/README-rapid-burst.md
+++ b/dev/load-test/test-recipes/README-rapid-burst.md
@@ -44,12 +44,18 @@ Before running this test, ensure the following prerequisites are met:
         args:
           - --leader-elect=true
           - --extensions
+          - --enable-pprof-debug
+          - --enable-tracing
+          - --zap-log-level=debug
+          - --zap-encoder=json
           - --kube-api-qps=1000
           - --kube-api-burst=1000
           - --sandbox-concurrent-workers=1000
           - --sandbox-claim-concurrent-workers=1000
           - --sandbox-warm-pool-concurrent-workers=1000
     ```
+  - If you are using tracing, see [GKE OTLP Metrics](https://docs.cloud.google.com/stackdriver/docs/otlp-metrics/deploy-collector)
+    for how to deploy the collector.
   - Apply your modified manifests to your cluster to install the agent-sandbox controller.
     ```bash
     cd ~/agent-sandbox
diff --git a/dev/load-test/test-recipes/rapid-burst-test.yaml b/dev/load-test/test-recipes/rapid-burst-test.yaml
index 17f81d192..2b743a73f 100644
--- a/dev/load-test/test-recipes/rapid-burst-test.yaml
+++ b/dev/load-test/test-recipes/rapid-burst-test.yaml
@@ -51,6 +51,26 @@ steps:
           query: histogram_quantile(0.99, sum(rate(agent_sandbox_claim_startup_latency_ms_bucket{}[%v])) by (le))
           threshold: 5000  # Equivalent to 5s
           requireSamples: true
+  - Identifier: SandboxClaimControllerStartupLatency
+    Method: GenericPrometheusQuery
+    Params:
+      action: start
+      metricName: Agent Sandbox Claim Controller Startup Latency (ms)
+      metricVersion: v1
+      unit: ms
+      queries:
+        - name: ControllerStartupLatency50
+          query: histogram_quantile(0.50, sum(rate(agent_sandbox_claim_controller_startup_latency_ms_bucket{}[%v])) by (le))
+          threshold: 1000
+          requireSamples: true
+        - name: ControllerStartupLatency90
+          query: histogram_quantile(0.90, sum(rate(agent_sandbox_claim_controller_startup_latency_ms_bucket{}[%v])) by (le))
+          threshold: 1000
+          requireSamples: true
+        - name: ControllerStartupLatency99
+          query: histogram_quantile(0.99, sum(rate(agent_sandbox_claim_controller_startup_latency_ms_bucket{}[%v])) by (le))
+          threshold: 5000
+          requireSamples: true
 
 - name: Setup Sandbox Template
   phases:
@@ -154,6 +174,11 @@ steps:
     Params:
       action: gather
       enableViolations: true
+  - Identifier: SandboxClaimControllerStartupLatency
+    Method: GenericPrometheusQuery
+    Params:
+      action: gather
+      enableViolations: true
 
 - name: Delete Sandbox Claims
   phases:
diff --git a/extensions/controllers/sandboxclaim_controller.go b/extensions/controllers/sandboxclaim_controller.go
index 226dfdc2e..dd9dc0899 100644
--- a/extensions/controllers/sandboxclaim_controller.go
+++ b/extensions/controllers/sandboxclaim_controller.go
@@ -41,6 +41,8 @@ import (
 	asmetrics "sigs.k8s.io/agent-sandbox/internal/metrics"
 )
 
+const observabilityAnnotation = "agent-sandbox.kubernetes.io/controller-first-observed-at"
+
 // ErrTemplateNotFound is a sentinel error indicating a SandboxTemplate was not found.
 var ErrTemplateNotFound = errors.New("SandboxTemplate not found")
 
@@ -92,15 +94,23 @@ func (r *SandboxClaimReconciler) Reconcile(ctx context.Context, req ctrl.Request
 		return ctrl.Result{}, nil
 	}
 
-	// Initialize trace ID for active resources missing an ID. Inline patch,
-	// no early return, to avoid forcing a second reconcile cycle.
-	tc := r.Tracer.GetTraceContext(ctx)
-	if tc != "" && (claim.Annotations == nil || claim.Annotations[asmetrics.TraceContextAnnotation] == "") {
+	// Initialize trace ID and observation time for active resources missing them.
+	// Inline patch, no early return, to avoid forcing a second reconcile cycle.
+	traceContext := r.Tracer.GetTraceContext(ctx)
+	needObservabilityPatch := claim.Annotations[observabilityAnnotation] == ""
+	needTraceContextPatch := traceContext != "" && (claim.Annotations[asmetrics.TraceContextAnnotation] == "")
+
+	if needObservabilityPatch || needTraceContextPatch {
 		patch := client.MergeFrom(claim.DeepCopy())
 		if claim.Annotations == nil {
 			claim.Annotations = make(map[string]string)
 		}
-		claim.Annotations[asmetrics.TraceContextAnnotation] = tc
+		if needObservabilityPatch {
+			claim.Annotations[observabilityAnnotation] = time.Now().Format(time.RFC3339Nano)
+		}
+		if needTraceContextPatch {
+			claim.Annotations[asmetrics.TraceContextAnnotation] = traceContext
+		}
 		if err := r.Patch(ctx, claim, patch); err != nil {
 			return ctrl.Result{}, err
 		}
@@ -441,8 +451,8 @@ func (r *SandboxClaimReconciler) adoptSandboxFromCandidates(ctx context.Context,
 		if adopted.Annotations == nil {
 			adopted.Annotations = make(map[string]string)
 		}
-		if tc, ok := claim.Annotations[asmetrics.TraceContextAnnotation]; ok {
-			adopted.Annotations[asmetrics.TraceContextAnnotation] = tc
+		if traceContext, ok := claim.Annotations[asmetrics.TraceContextAnnotation]; ok {
+			adopted.Annotations[asmetrics.TraceContextAnnotation] = traceContext
 		}
 
 		// Add sandbox ID label to pod template for NetworkPolicy targeting
@@ -516,8 +526,8 @@ func (r *SandboxClaimReconciler) createSandbox(ctx context.Context, claim *exten
 	if sandbox.Annotations == nil {
 		sandbox.Annotations = make(map[string]string)
 	}
-	if tc, ok := claim.Annotations[asmetrics.TraceContextAnnotation]; ok {
-		sandbox.Annotations[asmetrics.TraceContextAnnotation] = tc
+	if traceContext, ok := claim.Annotations[asmetrics.TraceContextAnnotation]; ok {
+		sandbox.Annotations[asmetrics.TraceContextAnnotation] = traceContext
 	}
 
 	// Track the sandbox template ref to be used by metrics collector
@@ -822,6 +832,19 @@ func (r *SandboxClaimReconciler) recordCreationLatencyMetric(
 	// startup latency when the TemplateRef is updated.
 	asmetrics.RecordClaimStartupLatency(claim.CreationTimestamp.Time, launchType, claim.Spec.TemplateRef.Name)
 
+	// Record controller startup latency
+	if claim.Annotations[observabilityAnnotation] != "" {
+		observedTimeString := claim.Annotations[observabilityAnnotation]
+		observedTime, err := time.Parse(time.RFC3339Nano, observedTimeString)
+		if err != nil {
+			logger.Error(err, "Failed to parse controller observation time", "value", observedTimeString)
+		} else {
+			controllerLatency := time.Since(observedTime).Milliseconds()
+			logger.V(1).Info("Recording controller startup latency", "claim", claim.Name, "latency_ms", controllerLatency)
+			asmetrics.RecordClaimControllerStartupLatency(observedTime, launchType, claim.Spec.TemplateRef.Name)
+		}
+	}
+
 	// For cold launches, also record the time from Sandbox creation to Ready state to capture controller overhead.
 	if sandbox == nil || sandbox.CreationTimestamp.IsZero() {
 		return
diff --git a/internal/metrics/metrics.go b/internal/metrics/metrics.go
index 37cb16113..b437085ce 100644
--- a/internal/metrics/metrics.go
+++ b/internal/metrics/metrics.go
@@ -36,9 +36,23 @@ var (
 	ClaimStartupLatency = prometheus.NewHistogramVec(
 		prometheus.HistogramOpts{
 			Name: "agent_sandbox_claim_startup_latency_ms",
-			Help: "End-to-end latency from SandboxClaim creation to Pod Ready state in milliseconds.",
-			// Buckets for latency from 50ms to 4 minutes
-			Buckets: []float64{50, 100, 250, 500, 1000, 2500, 5000, 10000, 30000, 60000, 120000, 240000},
+			Help: "End-to-end latency from SandboxClaim creation to Sandbox Ready state in milliseconds.",
+			// Buckets for latency from 100ms to 4 minutes
+			Buckets: []float64{100, 250, 500, 750, 1000, 1250, 1500, 2000, 2500, 5000, 10000, 30000, 60000, 120000, 240000},
+		},
+		[]string{"launch_type", "sandbox_template"},
+	)
+
+	// ClaimControllerStartupLatency measures the time from controller first observed timestamp to SandboxClaim Ready state.
+	// Labels:
+	// - launch_type: "warm", "cold", "unknown"
+	// - sandbox_template: the SandboxTemplateRef
+	ClaimControllerStartupLatency = prometheus.NewHistogramVec(
+		prometheus.HistogramOpts{
+			Name: "agent_sandbox_claim_controller_startup_latency_ms",
+			Help: "Latency from controller first observed SandboxClaim to Sandbox Ready state in milliseconds.",
+			// Buckets for latency from 100ms to 4 minutes
+			Buckets: []float64{100, 250, 500, 750, 1000, 1250, 1500, 2000, 2500, 5000, 10000, 30000, 60000, 120000, 240000},
 		},
 		[]string{"launch_type", "sandbox_template"},
 	)
@@ -91,6 +105,7 @@ var (
 // Init registers custom metrics with the global controller-runtime registry.
 func init() {
 	metrics.Registry.MustRegister(ClaimStartupLatency)
+	metrics.Registry.MustRegister(ClaimControllerStartupLatency)
 	metrics.Registry.MustRegister(SandboxCreationLatency)
 	metrics.Registry.MustRegister(SandboxClaimCreationTotal)
 }
@@ -101,6 +116,12 @@ func RecordClaimStartupLatency(startTime time.Time, launchType, templateName str
 	ClaimStartupLatency.WithLabelValues(launchType, templateName).Observe(duration)
 }
 
+// RecordClaimControllerStartupLatency records the duration since the provided controller start time.
+func RecordClaimControllerStartupLatency(startTime time.Time, launchType, templateName string) {
+	duration := float64(time.Since(startTime).Milliseconds())
+	ClaimControllerStartupLatency.WithLabelValues(launchType, templateName).Observe(duration)
+}
+
 // RecordSandboxCreationLatency records the measured latency duration for a sandbox creation.
 func RecordSandboxCreationLatency(duration time.Duration, namespace, launchType, templateName string) {
 	SandboxCreationLatency.WithLabelValues(namespace, launchType, templateName).Observe(float64(duration.Milliseconds()))