diff --git a/.changeset/hip-hairs-exist.md b/.changeset/hip-hairs-exist.md
new file mode 100644
index 0000000000..d8cb939dfb
--- /dev/null
+++ b/.changeset/hip-hairs-exist.md
@@ -0,0 +1,6 @@
+---
+'@backstage/plugin-catalog-backend': patch
+'@backstage/plugin-catalog-node': patch
+---
+
+Added setAllowedLocationTypes while introducing a new extension point called CatalogLocationsExtensionPoint
diff --git a/plugins/catalog-backend/src/service/CatalogPlugin.ts b/plugins/catalog-backend/src/service/CatalogPlugin.ts
index aebd969701..2f5fd9103d 100644
--- a/plugins/catalog-backend/src/service/CatalogPlugin.ts
+++ b/plugins/catalog-backend/src/service/CatalogPlugin.ts
@@ -28,6 +28,8 @@ import {
   catalogPermissionExtensionPoint,
   CatalogProcessingExtensionPoint,
   catalogProcessingExtensionPoint,
+  CatalogLocationsExtensionPoint,
+  catalogLocationsExtensionPoint,
 } from '@backstage/plugin-catalog-node/alpha';
 import {
   CatalogProcessor,
@@ -41,6 +43,20 @@ import { merge } from 'lodash';
 import { Permission } from '@backstage/plugin-permission-common';
 import { ForwardedError } from '@backstage/errors';
 
+class CatalogLocationsExtensionPointImpl
+  implements CatalogLocationsExtensionPoint
+{
+  #locationTypes = new Array<string>();
+
+  setAllowedLocationTypes(locationTypes: Array<string>) {
+    this.#locationTypes = locationTypes;
+  }
+
+  get allowedLocationTypes() {
+    return this.#locationTypes;
+  }
+}
+
 class CatalogProcessingExtensionPointImpl
   implements CatalogProcessingExtensionPoint
 {
@@ -199,6 +215,12 @@ export const catalogPlugin = createBackendPlugin({
     const modelExtensions = new CatalogModelExtensionPointImpl();
     env.registerExtensionPoint(catalogModelExtensionPoint, modelExtensions);
 
+    const locationTypeExtensions = new CatalogLocationsExtensionPointImpl();
+    env.registerExtensionPoint(
+      catalogLocationsExtensionPoint,
+      locationTypeExtensions,
+    );
+
     env.registerInit({
       deps: {
         logger: coreServices.logger,
@@ -271,6 +293,10 @@ export const catalogPlugin = createBackendPlugin({
         builder.addPermissionRules(...permissionExtensions.permissionRules);
         builder.setFieldFormatValidators(modelExtensions.fieldValidators);
 
+        builder.setAllowedLocationTypes(
+          locationTypeExtensions.allowedLocationTypes,
+        );
+
         const { processingEngine, router } = await builder.build();
 
         lifecycle.addStartupHook(async () => {
diff --git a/plugins/catalog-node/api-report-alpha.md b/plugins/catalog-node/api-report-alpha.md
index b61d1b1d27..e14f55c196 100644
--- a/plugins/catalog-node/api-report-alpha.md
+++ b/plugins/catalog-node/api-report-alpha.md
@@ -34,6 +34,14 @@ export interface CatalogAnalysisExtensionPoint {
 // @alpha (undocumented)
 export const catalogAnalysisExtensionPoint: ExtensionPoint<CatalogAnalysisExtensionPoint>;
 
+// @alpha (undocumented)
+export interface CatalogLocationsExtensionPoint {
+  setAllowedLocationTypes(locationTypes: Array<string>): void;
+}
+
+// @alpha (undocumented)
+export const catalogLocationsExtensionPoint: ExtensionPoint<CatalogLocationsExtensionPoint>;
+
 // @alpha (undocumented)
 export interface CatalogModelExtensionPoint {
   setEntityDataParser(parser: CatalogProcessorParser): void;
diff --git a/plugins/catalog-node/src/alpha.ts b/plugins/catalog-node/src/alpha.ts
index 91b5bb99b6..b75ec48a7f 100644
--- a/plugins/catalog-node/src/alpha.ts
+++ b/plugins/catalog-node/src/alpha.ts
@@ -15,6 +15,8 @@
  */
 
 export { catalogServiceRef } from './catalogService';
+export type { CatalogLocationsExtensionPoint } from './extensions';
+export { catalogLocationsExtensionPoint } from './extensions';
 export type { CatalogProcessingExtensionPoint } from './extensions';
 export { catalogProcessingExtensionPoint } from './extensions';
 export type { CatalogAnalysisExtensionPoint } from './extensions';
diff --git a/plugins/catalog-node/src/extensions.ts b/plugins/catalog-node/src/extensions.ts
index 7c1fe6c30d..a971e1588d 100644
--- a/plugins/catalog-node/src/extensions.ts
+++ b/plugins/catalog-node/src/extensions.ts
@@ -31,6 +31,25 @@ import {
 } from '@backstage/plugin-permission-common';
 import { PermissionRule } from '@backstage/plugin-permission-node';
 
+/**
+ * @alpha
+ */
+export interface CatalogLocationsExtensionPoint {
+  /**
+   * Allows setting custom location types, such as showcased in: https://backstage.io/docs/features/software-catalog/external-integrations/#creating-a-catalog-data-reader-processor
+   * @param locationTypes - List of location types to allow, default is "url" and "file"
+   */
+  setAllowedLocationTypes(locationTypes: Array<string>): void;
+}
+
+/**
+ * @alpha
+ */
+export const catalogLocationsExtensionPoint =
+  createExtensionPoint<CatalogLocationsExtensionPoint>({
+    id: 'catalog.locations',
+  });
+
 /**
  * @alpha
  */