diff --git a/controllers/nvidiadriver_controller.go b/controllers/nvidiadriver_controller.go
index 829dcff6b..6b862e39d 100644
--- a/controllers/nvidiadriver_controller.go
+++ b/controllers/nvidiadriver_controller.go
@@ -26,6 +26,7 @@ import (
 	corev1 "k8s.io/api/core/v1"
 	apierrors "k8s.io/apimachinery/pkg/api/errors"
 	metav1 "k8s.io/apimachinery/pkg/apis/meta/v1"
+	"k8s.io/apimachinery/pkg/labels"
 	"k8s.io/apimachinery/pkg/runtime"
 	"k8s.io/apimachinery/pkg/types"
 	"k8s.io/client-go/util/workqueue"
@@ -168,6 +169,10 @@ func (r *NVIDIADriverReconciler) Reconcile(ctx context.Context, req ctrl.Request
 		return reconcile.Result{}, nil
 	}
 
+	err = updateNodesManagedByDriver(ctx, r, instance)
+	if err != nil {
+		return reconcile.Result{}, fmt.Errorf("failed to update nodes managed by driver: %w", err)
+	}
 	// Sync state and update status
 	managerStatus := r.stateManager.SyncState(ctx, instance, infoCatalog)
 
@@ -404,5 +409,111 @@ func (r *NVIDIADriverReconciler) SetupWithManager(ctx context.Context, mgr ctrl.
 		return fmt.Errorf("failed to add index key: %w", err)
 	}
 
+	if err := mgr.GetFieldIndexer().IndexField(ctx, &corev1.Pod{}, "spec.nodeName", func(rawObj client.Object) []string {
+		pod := rawObj.(*corev1.Pod)
+		return []string{pod.Spec.NodeName}
+	}); err != nil {
+		return err
+	}
+
+	return nil
+}
+
+func updateNodesManagedByDriver(ctx context.Context, r NVIDIADriverReconciler, instance *nvidiav1alpha1.NVIDIADriver) error {
+	nodes, err := getNVIDIADriverSelectedNodes(ctx, r.Client, instance)
+	if err != nil {
+		return fmt.Errorf("failed to get selected nodes for NVIDIADriver CR: %w", err)
+	}
+
+	// A map tracking which node objects need to be updated. E.g. updated label / annotations
+	// need to be applied.
+	nodesToUpdate := map[*corev1.Node]struct{}{}
+
+	for _, node := range nodes.Items {
+		labels := node.GetLabels()
+		annotations := node.GetAnnotations()
+
+		managedBy, exists := labels["nvidia.com/gpu.driver.managed-by"]
+		if !exists {
+			// if 'managed-by' label does not exist, label node with cr.Name
+			labels["nvidia.com/gpu.driver.managed-by"] = instance.Name
+			nodesToUpdate[&node] = struct{}{}
+			// if there is an orphan driver pod running on the node,
+			// indicate to the upgrade controller that an upgrade is required
+			podList := &corev1.PodList{}
+			err = r.Client.List(ctx, podList,
+				client.InNamespace("gpu-operator"),
+				client.MatchingLabels(map[string]string{DriverLabelKey: DriverLabelValue}),
+				client.MatchingFields{"spec.nodeName": node.Name})
+			if err != nil {
+				return fmt.Errorf("failed to list driver pods: %w", err)
+			}
+			if len(podList.Items) == 0 {
+				continue
+			}
+			if len(podList.Items) != 1 {
+				return fmt.Errorf("there are multiple driver pods running on node %s", node.Name)
+			}
+			pod := podList.Items[0]
+			if pod.OwnerReferences == nil || len(pod.OwnerReferences) == 0 {
+				annotations["nvidia.com/gpu-driver-upgrade-requested"] = "true"
+			}
+			continue
+		}
+
+		// do nothing if node is already being managed by this CR
+		if managedBy == instance.Name {
+			continue
+		}
+
+	}
+
+	// Apply updated labels / annotations on node objects
+	for node := range nodesToUpdate {
+		err = r.Client.Update(ctx, node)
+		if err != nil {
+			return fmt.Errorf("failed to update node %s: %w", node.Name, err)
+		}
+	}
+
 	return nil
 }
+
+// getNVIDIADriverSelectedNodes returns selected nodes based on the nodeselector labels set for a given NVIDIADriver instance
+func getNVIDIADriverSelectedNodes(ctx context.Context, k8sClient client.Client, cr *nvidiav1alpha1.NVIDIADriver) (*corev1.NodeList, error) {
+	nodeList := &corev1.NodeList{}
+
+	if cr.Spec.NodeSelector == nil {
+		cr.Spec.NodeSelector = cr.GetNodeSelector()
+	}
+
+	selector := labels.Set(cr.Spec.NodeSelector).AsSelector()
+
+	opts := []client.ListOption{
+		client.MatchingLabelsSelector{Selector: selector},
+	}
+	err := k8sClient.List(ctx, nodeList, opts...)
+
+	return nodeList, err
+}
+
+/*
+func getDriverPodLabelSelector(clusterPolicy gpuv1.ClusterPolicy) map[string]string {
+	// initialize with common app=nvidia-driver-daemonset label
+	driverLabelKey := DriverLabelKey
+	driverLabelValue := DriverLabelValue
+
+	if clusterPolicy.Spec.Driver.UseNvdiaDriverCRDType() {
+		// app component label is added for all new driver daemonsets deployed by NVIDIADriver controller
+		driverLabelKey = AppComponentLabelKey
+		driverLabelValue = AppComponentLabelValue
+	} else if clusterPolicyCtrl.openshift != "" && clusterPolicyCtrl.ocpDriverToolkit.enabled {
+		// For OCP, when DTK is enabled app=nvidia-driver-daemonset label is not constant and changes
+		// based on rhcos version. Hence use DTK label instead
+		driverLabelKey = ocpDriverToolkitIdentificationLabel
+		driverLabelValue = ocpDriverToolkitIdentificationValue
+	}
+
+	return map[string]string{driverLabelKey: driverLabelValue}
+}
+*/