diff --git a/tests/cloud_playbooks/roles/packet-ci/defaults/main.yml b/tests/cloud_playbooks/roles/packet-ci/defaults/main.yml
index ced8f8cfb..2c3377fd7 100644
--- a/tests/cloud_playbooks/roles/packet-ci/defaults/main.yml
+++ b/tests/cloud_playbooks/roles/packet-ci/defaults/main.yml
@@ -5,6 +5,7 @@ vm_cpu_cores: 2
 vm_cpu_sockets: 1
 vm_cpu_threads: 2
 vm_memory: 2048
+releases_disk_size: 2Gi
 
 # Request/Limit allocation settings
 cpu_allocation_ratio: 0.25
diff --git a/tests/cloud_playbooks/roles/packet-ci/templates/vm.yml.j2 b/tests/cloud_playbooks/roles/packet-ci/templates/vm.yml.j2
index 49b435220..0c3a4664d 100644
--- a/tests/cloud_playbooks/roles/packet-ci/templates/vm.yml.j2
+++ b/tests/cloud_playbooks/roles/packet-ci/templates/vm.yml.j2
@@ -34,6 +34,10 @@ spec:
         - disk:
             bus: virtio
           name: cloudinitvolume
+        - disk:
+            bus: virtio
+          name: releases
+          serial: '2825A83CBDC8A32D5E'
       interfaces:
       - name: default
         bridge: {}
@@ -59,3 +63,6 @@ spec:
     - name: cloudinitvolume
       cloudInit{{ 'ConfigDrive' if cloud_image.startswith('flatcar') else 'NoCloud' }}:
         userDataBase64: '{{ ((ignition_config | to_json) if cloud_image.startswith('flatcar') else cloudinit_config) | b64encode }}'
+    - name: releases
+      emptyDisk:
+        capacity: '{{ releases_disk_size }}'
diff --git a/tests/cloud_playbooks/roles/packet-ci/vars/main.yml b/tests/cloud_playbooks/roles/packet-ci/vars/main.yml
index 8953805e9..0093e04a7 100644
--- a/tests/cloud_playbooks/roles/packet-ci/vars/main.yml
+++ b/tests/cloud_playbooks/roles/packet-ci/vars/main.yml
@@ -44,6 +44,12 @@ cloudinit_config: |
       lock_passwd: False
       ssh_authorized_keys:
         - {{ ssh_key.public_key }}
+  fs_setup:
+    - device: '/dev/disk/by-id/virtio-2825A83CBDC8A32D5E'
+      filesystem: 'ext4'
+      partition: 'none'
+  mounts:
+    - ['/dev/disk/by-id/virtio-2825A83CBDC8A32D5E', '/tmp/releases']
 
 ignition_config:
   ignition:
@@ -56,3 +62,9 @@ ignition_config:
           - wheel
         sshAuthorizedKeys:
           - "{{ ssh_key.public_key }}"
+  storage:
+    filesystems:
+      - device: '/dev/disk/by-id/virtio-2825A83CBDC8A32D5E'
+        format: ext4
+        path: /tmp/releases
+        wipeFilesystem: true
diff --git a/tests/common_vars.yml b/tests/common_vars.yml
index 1450a3b6c..4575c607b 100644
--- a/tests/common_vars.yml
+++ b/tests/common_vars.yml
@@ -36,3 +36,5 @@ nginx_image_repo: "{{ quay_image_repo }}/kubespray/nginx"
 
 flannel_image_repo: "{{ quay_image_repo }}/kubespray/flannel"
 flannel_init_image_repo: "{{ quay_image_repo }}/kubespray/flannel-cni-plugin"
+
+local_release_dir: "{{ '/tmp/releases' if inventory_hostname != 'localhost' else (lookup('env', 'PWD') + '/downloads') }}"
diff --git a/tests/scripts/testcases_run.sh b/tests/scripts/testcases_run.sh
index e64a3b9e3..8e2ac5dd9 100755
--- a/tests/scripts/testcases_run.sh
+++ b/tests/scripts/testcases_run.sh
@@ -39,7 +39,6 @@ shift
 ansible-playbook \
     -e @tests/common_vars.yml \
     -e @tests/${TESTCASE_FILE} \
-    -e local_release_dir=${PWD}/downloads \
     "$@" \
     ${playbook}
 }