diff --git a/agent/06_agent_create_cluster.sh b/agent/06_agent_create_cluster.sh
index af5ecf27c..5609563f6 100755
--- a/agent/06_agent_create_cluster.sh
+++ b/agent/06_agent_create_cluster.sh
@@ -23,9 +23,28 @@ function create_pxe_files() {
 function create_image() {
     local asset_dir=${1}
     local openshift_install=${2}
+
+    if [ "${AGENT_USE_APPLIANCE_MODEL}" == true ]; then
+      create_factory_image
+    else
+      create_automated_image
+    fi
+}
+
+function create_automated_image() {
     "${openshift_install}" --dir="${asset_dir}" --log-level=debug agent create image
 }
 
+function create_factory_image() {
+    "${openshift_install}" --dir="${asset_dir}" --log-level=debug agent create cluster-manifests
+    "${openshift_install}" --dir="${asset_dir}" --log-level=debug agent create unconfigured-ignition
+    oc adm release info --image-for=machine-os-images --insecure=true $OPENSHIFT_RELEASE_IMAGE
+    base_iso_url=$(oc adm release info --image-for=machine-os-images --insecure=true $OPENSHIFT_RELEASE_IMAGE)
+    oc image extract --path /coreos/coreos-x86_64.iso:$HOME/.cache/agent/image_cache --confirm $base_iso_url
+    local agent_iso_abs_path="$(realpath "${OCP_DIR}")"
+    podman run --privileged --rm -v /run/udev:/run/udev -v "${agent_iso_abs_path}:${agent_iso_abs_path}" -v "$HOME/.cache/agent/image_cache/:$HOME/.cache/agent/image_cache/" quay.io/coreos/coreos-installer:release iso ignition embed -f -i "${agent_iso_abs_path}/unconfigured-agent.ign" -o "${agent_iso_abs_path}/agent.iso" $HOME/.cache/agent/image_cache/coreos-x86_64.iso
+}
+
 function attach_agent_iso() {
 
     # This is required to allow qemu opening the disk image
diff --git a/agent/common.sh b/agent/common.sh
index 09458c830..8ab346720 100644
--- a/agent/common.sh
+++ b/agent/common.sh
@@ -27,3 +27,5 @@ function getReleaseImage() {
     fi
     echo ${releaseImage}
 }
+
+export AGENT_USE_APPLIANCE_MODEL=${AGENT_USE_APPLIANCE_MODEL:-"false"}
\ No newline at end of file
diff --git a/config_example.sh b/config_example.sh
index e686643a0..072d38490 100755
--- a/config_example.sh
+++ b/config_example.sh
@@ -693,3 +693,9 @@ set -x
 # As per https://libvirt.org/formatnetwork.html, the tftp element is not supported for IPv6 addresses, 
 # and can only be specified on a single IPv4 address per network
 # AGENT_E2E_TEST_BOOT_MODE=PXE
+
+# Uncomment the following line to deploy the cluster using the appliance model
+# The appliance model boots the host using the unconfigured ignition. It then mounts
+# the configuration ISO where its contents are copied over to the host. The cluster
+# installation is triggered when the /etc/assisted/rendezvous-host.env file is present.
+# export AGENT_USE_APPLIANCE_MODEL=false