This paper discusses the feasibility of a terahertzsignal source made of an AlGaN/GaN superlattice. The negative differential conductivity, electrical domain formation, current oscillations, and power efficiency of a perspective source are described. The superlattice geometry and conduction band profile, which are distorted by polarization fields, are related to the oscillation frequency and power efficiency of the device. The optimal Al content, superlattice period, and the parameters of the external circuit that favor submillimeter wave generation are determined.