Grinding while riding

Im the new owner of a 79 xs400, I've been working on it for the past few weeks and finally got it to run. I took it out for a test drive and noticed it makes a grinding noise, almost like gears grinding. It's not consistent and happens every couple seconds sporadically. I think its coming from the gear box, not positive though. It shifts fine and when riding at low rpm in any gear the noise is not there. Once I accelerate it starts. I lifted the rear tire off the ground and accelerated through all gears and it didn't make the noise. Im not very familiar with the bike so just wondering if anyone else has any input. I don't want to ride it anymore and damage something.

Adjust the timing chain and see if it helps. A dead/dying chain can do that

The sohc xs400 has a self adjusting cam chain. I would look to the chain and sprockets. Maybe brake pads or wheel bearings. Post some pics of the bike.

Thank you guys, I will look at the cam chain, and try and record the noise once the snow melts. I've inspected the bike and didn't see anything visually wrong on the outside. I've also spun the wheels and couldn't replicate any sort of noise so I don't feel that is the wheel bearings or brakes. The bike sounds fine when running stationary in gear so maybe it only happens under load. In the meantime here are some pictures

Your drive chain looks rusty. Make sure it's lubed well and adjusted to spec. The chain looks like it may be tight also. Make sure the sprockets are torqued to spec.

I agree, drive chain too tight and will tighten more when the suspension compresses.
Its rusty as I can see a link out of line which has seized.

X3 on chain likely too tight in pic, you get 1/2"-1" of play at off stand and rider weight sitting on bike. Too tight will most definitely grind.

My bad on the chain tensioner type but if the rachet teeth have worn it can slip and cam chain still be loose. There is still an adjustment to back off for a new shorter chain too. Likely have to remove tensioner to do it. You have to back the rachet off.

I like that bike, I used to ride Honda 160-200s like that back in the day. 305 Super Hawks too.