diff --git a/build_debian.sh b/build_debian.sh
index e113e6925107..76cd4467ce10 100755
--- a/build_debian.sh
+++ b/build_debian.sh
@@ -267,7 +267,7 @@ sudo du -hs $FILESYSTEM_ROOT
 sudo mksquashfs $FILESYSTEM_ROOT $FILESYSTEM_SQUASHFS -e boot -e var/lib/docker
 
 ## Compress docker files
-pushd $FILESYSTEM_ROOT && sudo tar czf $OLDPWD/$FILESYSTEM_DOCKERFS var/lib/docker; popd
+pushd $FILESYSTEM_ROOT && sudo tar czf $OLDPWD/$FILESYSTEM_DOCKERFS -C var/lib/docker .; popd
 
 ## Compress together with /boot and /var/lib/docker as an installer payload zip file
 pushd $FILESYSTEM_ROOT && sudo zip $OLDPWD/$ONIE_INSTALLER_PAYLOAD -r boot/; popd
diff --git a/files/Aboot/boot0.j2 b/files/Aboot/boot0.j2
index edd052450ed2..8ec50ef7f9e3 100644
--- a/files/Aboot/boot0.j2
+++ b/files/Aboot/boot0.j2
@@ -45,7 +45,7 @@ extract_image() {
     rm -rf "$target_path/rw"
 
     ## Clean docker directory
-    rm -rf "$target_path/var"
+    rm -rf "$target_path/{{ DOCKERFS_DIR }}"
 
     ## Unzip the image
     unzip -oq "$swipath" -x boot0 -d "$target_path"
@@ -58,8 +58,10 @@ extract_image() {
 
     ## vfat does not support symbol link
     if [ $rootfs_type != "vfat" ]; then
-        ## Further extract docker archive
-        tar xf "$target_path/{{ FILESYSTEM_DOCKERFS }}" -C "$target_path"
+        mkdir -p "$target_path/{{ DOCKERFS_DIR }}"
+
+        ## extract docker archive
+        tar xf "$target_path/{{ FILESYSTEM_DOCKERFS }}" -C "$target_path/{{ DOCKERFS_DIR }}"
 
         ## clean up docker archive
         rm -f "$target_path/{{ FILESYSTEM_DOCKERFS }}"
diff --git a/files/initramfs-tools/arista-convertfs b/files/initramfs-tools/arista-convertfs.j2
similarity index 94%
rename from files/initramfs-tools/arista-convertfs
rename to files/initramfs-tools/arista-convertfs.j2
index 676cbab4cc8b..8847bc69bdfa 100644
--- a/files/initramfs-tools/arista-convertfs
+++ b/files/initramfs-tools/arista-convertfs.j2
@@ -165,7 +165,7 @@ cmd="mount -t ext4 $root_dev $root_mnt"
 run_cmd "$cmd" "$err_msg"
 
 err_msg="Error: extract docker directory"
-cmd="[ -f $tmp_mnt/dockerfs.tar.gz ] && rm -rf $tmp_mnt/var && tar xzf $tmp_mnt/dockerfs.tar.gz -C $root_mnt && rm -f $tmp_mnt/dockerfs.tar.gz"
+cmd="[ -f $tmp_mnt/{{ FILESYSTEM_DOCKERFS }} ] && rm -rf $root_mnt/{{ DOCKERFS_DIR }} && mkdir $root_mnt/{{ DOCKERFS_DIR }} && tar xzf $tmp_mnt/{{ FILESYSTEM_DOCKERFS }} -C $root_mnt/{{ DOCKERFS_DIR }} && rm -f $tmp_mnt/{{ FILESYSTEM_DOCKERFS }}"
 run_cmd "$cmd" "$err_msg"
 
 err_msg="Error: copying files form $tmp_mnt to $root_mnt failed"
diff --git a/files/initramfs-tools/union-mount b/files/initramfs-tools/union-mount.j2
similarity index 88%
rename from files/initramfs-tools/union-mount
rename to files/initramfs-tools/union-mount.j2
index b343d56c6e22..531436c39a2f 100644
--- a/files/initramfs-tools/union-mount
+++ b/files/initramfs-tools/union-mount.j2
@@ -12,7 +12,7 @@ mount -n -o dirs=${rootmnt}/host/rw:${rootmnt}=ro -t aufs root-aufs ${rootmnt}
 mount ${ROOT} ${rootmnt}/host
 ## Mount the working directory of docker engine in the raw partition, bypass the aufs
 mkdir -p ${rootmnt}/var/lib/docker
-mount --bind ${rootmnt}/host/var/lib/docker ${rootmnt}/var/lib/docker
+mount --bind ${rootmnt}/host/{{ DOCKERFS_DIR }} ${rootmnt}/var/lib/docker
 ## Mount the boot directory in the raw partition, bypass the aufs
 mkdir -p ${rootmnt}/boot
 mount --bind ${rootmnt}/host/boot ${rootmnt}/boot
diff --git a/installer/x86_64/install.sh b/installer/x86_64/install.sh
index b8177462a55c..2ff663c188eb 100755
--- a/installer/x86_64/install.sh
+++ b/installer/x86_64/install.sh
@@ -398,7 +398,7 @@ ${onie_bin} mount -t ext4 -o defaults,rw $demo_dev $demo_mnt || {
 unzip $ONIE_INSTALLER_PAYLOAD -d $demo_mnt
 
 if [ -f $demo_mnt/$FILESYSTEM_DOCKERFS ]; then
-    cd $demo_mnt && tar xf $FILESYSTEM_DOCKERFS; cd $OLDPWD
+    cd $demo_mnt && mkdir -p $DOCKERFS_DIR && tar xf $FILESYSTEM_DOCKERFS -C $DOCKERFS_DIR; cd $OLDPWD
 fi
 
 # Store machine description in target file system
diff --git a/onie-image.conf b/onie-image.conf
index 70228bbf2498..f12e23f7414b 100644
--- a/onie-image.conf
+++ b/onie-image.conf
@@ -21,6 +21,9 @@ ONIE_INSTALLER_PAYLOAD=fs.zip
 ## Filename for docker file system 
 FILESYSTEM_DOCKERFS=dockerfs.tar.gz
 
+## docker directory on the root filesystem
+DOCKERFS_DIR=docker
+
 ## Output file name for onie installer
 OUTPUT_ONIE_IMAGE=target/sonic-$TARGET_MACHINE.bin
 
diff --git a/slave.mk b/slave.mk
index 485f8ff9206c..68ed227cdc6a 100644
--- a/slave.mk
+++ b/slave.mk
@@ -285,7 +285,7 @@ $(DOCKER_LOAD_TARGETS) : $(TARGET_PATH)/%.gz-load : .platform docker-start $$(TA
 ###############################################################################
 
 # targets for building installers with base image
-$(addprefix $(TARGET_PATH)/, $(SONIC_INSTALLERS)) : $(TARGET_PATH)/% : .platform $$(addprefix $(DEBS_PATH)/,$$($$*_DEPENDS)) $(addprefix $(DEBS_PATH)/,$(INITRAMFS_TOOLS) $(LINUX_KERNEL) $(IGB_DRIVER)) $(addprefix $(DEBS_PATH)/,$(SONIC_CONFIG_ENGINE)) $$(addprefix $(TARGET_PATH)/,$$($$*_DOCKERS))
+$(addprefix $(TARGET_PATH)/, $(SONIC_INSTALLERS)) : $(TARGET_PATH)/% : .platform onie-image.conf $$(addprefix $(DEBS_PATH)/,$$($$*_DEPENDS)) $(addprefix $(DEBS_PATH)/,$(INITRAMFS_TOOLS) $(LINUX_KERNEL) $(IGB_DRIVER)) $(addprefix $(DEBS_PATH)/,$(SONIC_CONFIG_ENGINE)) $$(addprefix $(TARGET_PATH)/,$$($$*_DOCKERS))
 	$(HEADER)
 	## Pass initramfs and linux kernel explicitly. They are used for all platforms
 	export initramfs_tools="$(DEBS_PATH)/$(INITRAMFS_TOOLS)"
@@ -310,6 +310,9 @@ $(addprefix $(TARGET_PATH)/, $(SONIC_INSTALLERS)) : $(TARGET_PATH)/% : .platform
 	export installer_start_scrips="$(foreach docker, $($*_DOCKERS),$(addsuffix .sh, $($(docker)_CONTAINER_NAME)))"
 	export installer_services="$(foreach docker, $($*_DOCKERS),$(addsuffix .service, $($(docker)_CONTAINER_NAME)))"
 
+	j2 -f env files/initramfs-tools/union-mount.j2 onie-image.conf > files/initramfs-tools/union-mount
+	j2 -f env files/initramfs-tools/arista-convertfs.j2 onie-image.conf > files/initramfs-tools/arista-convertfs
+
 	$(if $($*_DOCKERS), 
 		j2 files/build_templates/sonic_debian_extension.j2 > sonic_debian_extension.sh
 		chmod +x sonic_debian_extension.sh,