Twitter Inc. said it plans to remove outside data sources from its ad-buying system, becoming the latest tech company to put more distance between itself and third-party consumer data providers.

The company currently offers data from outside firms to help advertisers target users on its platform, but early next year the company will end that integration and require advertisers to buy data on their own.

Twitter will also have to approve the data sources that marketers choose.

The new policy is unrelated to the rising concerns about data protection and privacy online, said Sarah Personette, vice president of global client solutions at Twitter. Instead it is meant to simplify buying for advertisers and let Twitter concentrate on other priorities, such as new products and technology, she said.

“We want to make sure we’re creating and developing the best possible experience for every advertiser, agency and marketer utilizing the system,” Ms. Personette said.

Most advertisers already use their own data to buy ads on Twitter instead of purchasing the third-party data available through its system, Ms. Personette added.

The change comes nonetheless amid growing tensions around data privacy.

Facebook Inc. last fall stopped allowing advertisers to use third-party data supplied through its system. That followed revelations that the data marketing firm Cambridge Analytica had improperly gained access to information about millions of Facebook users.

Twitter also said Tuesday that it had mistakenly shared data on some users and targeted ads to others without permission since last year. “You trust us to follow your choices and we failed here,” Twitter said, adding that it is still investigating who was affected.

The incident didn't prompt Twitter’s plan to remove outside data from its ad system, the company said.

New data-privacy rules including the General Data Protection Regulation in Europe and the California Consumer Privacy Act increasingly require businesses to get consumer consent before collecting their data to serve them ads.

Ad buyers said cutting off access to outside data could be an attempt to reduce risk for the company.

“It would appear that Twitter, like Facebook, is seeking to distance themselves from the perceived risks associated with third-party data,” John Lee, chief product and data officer at Dentsu Aegis agency Merkle, said. “By requiring advertisers to upload the data from their first-party seat, these platforms are ensuring that advertisers, not the platform or agency, is taking the accountability for the provenance and permissibility of the data they are injecting.”

Twitter said advertisers are already responsible for the data they use, even if they’ve gotten it through Twitter’s user interface. “This will not change,” a spokeswoman said.

The update will add at least one extra step for advertisers who have been relying on Twitter for outside data.

Megan Pagliuca, chief data officer at the ad-buying agency Hearts & Science, said Facebook’s move was good because clients should take responsibility for their own data strategy and build their own custom segments. “While it was a little inconvenient process-wise, we think it was the right thing strategically for our clients and business,” she said.

The same applies to Twitter, Ms. Pagliuca said.

How the shift will affect the cost of advertising on Twitter remains to be seen.

Closer relationships with data providers could push advertisers to create more granular audience targets instead of relying on “off-the-shelf” segments offered through Twitter, Ms. Pagliuca said. That could lessen the direct competition for certain audiences and potentially reduce costs.

However, the change should increase clarity around the prices for Twitter ads and data.

Twitter has been bundling costs for the outside data it provides into advertisers’ total purchase prices, and sharing the revenue with the data providers. Twitter said that will end with the new policy.

“Sophisticated marketers should be able to navigate this Twitter update in stride,” said Kieley Taylor, global head of social at the media-buying giant GroupM. “For those marketers who are not close to their data today, now is the time to plan for the growing gravity around data protection and privacy policies.”

Write to Alexandra Bruell at alexandra.bruell@wsj.com

Corrections & Amplifications

Twitter said Tuesday that it had mistakenly shared data on some users and targeted ads to others without permission since last year. An earlier version of this article incorrectly said Twitter made the announcement Wednesday. (Aug. 7, 2019)