diff --git a/crates/tests-integration/src/install.rs b/crates/tests-integration/src/install.rs
index de3a8dbe..dc9d2afd 100644
--- a/crates/tests-integration/src/install.rs
+++ b/crates/tests-integration/src/install.rs
@@ -93,153 +93,6 @@ pub(crate) fn run_alongside(image: &str, mut testargs: libtest_mimic::Arguments)
             cmd!(sh, "sudo {BASE_ARGS...} -v {tmpdisk}:/disk {image} bootc install to-disk --via-loopback /disk").run()?;
             Ok(())
         }),
-        Trial::test(
-            "install to-filesystem with separate /var mount",
-            move || {
-                let sh = &xshell::Shell::new()?;
-                reset_root(sh, image)?;
-
-                // Clean up any leftover LVM state from previous failed runs
-                let _ = cmd!(sh, "sudo vgchange -an BL").ignore_status().run();
-                let _ = cmd!(sh, "sudo vgremove -f BL").ignore_status().run();
-
-                // Create work directory for the test
-                let tmpd = sh.create_temp_dir()?;
-                let work_dir = tmpd.path();
-
-                // Create a disk image with partitions for root and var
-                let disk_img = work_dir.join("disk.img");
-                let size = 1024 * 1024 * 1024; // 1 GiB
-                let disk_file = std::fs::File::create(&disk_img)?;
-                disk_file.set_len(size)?;
-                drop(disk_file);
-
-                // Setup loop device
-                let loop_dev = cmd!(sh, "sudo losetup -f --show {disk_img}")
-                    .read()?
-                    .trim()
-                    .to_string();
-
-                // Helper closure for cleanup
-                let cleanup = |sh: &Shell, loop_dev: &str, target: &str| {
-                    // Unmount filesystems
-                    let _ = cmd!(sh, "sudo umount -R {target}").ignore_status().run();
-                    // Deactivate LVM
-                    let _ = cmd!(sh, "sudo vgchange -an BL").ignore_status().run();
-                    let _ = cmd!(sh, "sudo vgremove -f BL").ignore_status().run();
-                    // Detach loop device
-                    let _ = cmd!(sh, "sudo losetup -d {loop_dev}").ignore_status().run();
-                };
-
-                // Create partition table
-                if let Err(e) = (|| -> Result<()> {
-                    cmd!(sh, "sudo parted -s {loop_dev} mklabel gpt").run()?;
-                    // Create BIOS boot partition (for GRUB on GPT)
-                    cmd!(sh, "sudo parted -s {loop_dev} mkpart primary 1MiB 2MiB").run()?;
-                    cmd!(sh, "sudo parted -s {loop_dev} set 1 bios_grub on").run()?;
-                    // Create EFI partition
-                    cmd!(
-                        sh,
-                        "sudo parted -s {loop_dev} mkpart primary fat32 2MiB 202MiB"
-                    )
-                    .run()?;
-                    cmd!(sh, "sudo parted -s {loop_dev} set 2 esp on").run()?;
-                    // Create boot partition
-                    cmd!(
-                        sh,
-                        "sudo parted -s {loop_dev} mkpart primary ext4 202MiB 1226MiB"
-                    )
-                    .run()?;
-                    // Create LVM partition
-                    cmd!(sh, "sudo parted -s {loop_dev} mkpart primary 1226MiB 100%").run()?;
-
-                    // Reload partition table
-                    cmd!(sh, "sudo partprobe {loop_dev}").run()?;
-                    std::thread::sleep(std::time::Duration::from_secs(2));
-
-                    let efi_part2 = format!("{}p2", loop_dev); // EFI
-                    let root_part3 = format!("{}p3", loop_dev); // Boot
-                    let loop_part4 = format!("{}p4", loop_dev); // LVM
-
-                    // Create filesystems on boot partitions
-                    cmd!(sh, "sudo mkfs.vfat -F32 {efi_part2}").run()?;
-                    cmd!(sh, "sudo mkfs.ext4 -F {root_part3}").run()?;
-
-                    // Setup LVM
-                    cmd!(sh, "sudo pvcreate {loop_part4}").run()?;
-                    cmd!(sh, "sudo vgcreate BL {loop_part4}").run()?;
-
-                    // Create logical volumes
-                    cmd!(sh, "sudo lvcreate -L 100M -n var02 BL").run()?;
-                    cmd!(sh, "sudo lvcreate -L 100M -n root02 BL").run()?;
-
-                    // Create filesystems on logical volumes
-                    cmd!(sh, "sudo mkfs.ext4 -F /dev/BL/var02").run()?;
-                    cmd!(sh, "sudo mkfs.ext4 -F /dev/BL/root02").run()?;
-
-                    // Get UUIDs
-                    let root_uuid = cmd!(sh, "sudo blkid -s UUID -o value /dev/BL/root02")
-                        .read()?
-                        .trim()
-                        .to_string();
-                    let boot_uuid = cmd!(sh, "sudo blkid -s UUID -o value {efi_part2}")
-                        .read()?
-                        .trim()
-                        .to_string();
-
-                    // Mount the partitions
-                    let target_dir = work_dir.join("target");
-                    std::fs::create_dir_all(&target_dir)?;
-                    let target = target_dir.to_str().unwrap();
-
-                    cmd!(sh, "sudo mount /dev/BL/root02 {target}").run()?;
-                    cmd!(sh, "sudo mkdir -p {target}/boot").run()?;
-                    cmd!(sh, "sudo mount {root_part3} {target}/boot").run()?;
-                    cmd!(sh, "sudo mkdir -p {target}/boot/efi").run()?;
-                    cmd!(sh, "sudo mount {efi_part2} {target}/boot/efi").run()?;
-
-                    // Create EFI directory structure with some files (simulating existing EFI content)
-                    // This tests that bootc correctly handles /boot/efi as a mount point
-                    cmd!(sh, "sudo mkdir -p {target}/boot/efi/EFI/fedora").run()?;
-                    cmd!(sh, "sudo touch {target}/boot/efi/EFI/fedora/shimx64.efi").run()?;
-                    cmd!(sh, "sudo touch {target}/boot/efi/EFI/fedora/grubx64.efi").run()?;
-
-                    // Critical: Mount /var as a separate partition
-                    cmd!(sh, "sudo mkdir -p {target}/var").run()?;
-                    cmd!(sh, "sudo mount /dev/BL/var02 {target}/var").run()?;
-
-                    // Run bootc install to-filesystem
-                    // This should succeed and handle the separate /var mount correctly
-                    // Mount the target at /target inside the container for simplicity
-                    cmd!(
-                    sh,
-                    "sudo {BASE_ARGS...} -v {target}:/target -v /dev:/dev {image} bootc install to-filesystem --karg=root=UUID={root_uuid} --root-mount-spec=UUID={root_uuid} --boot-mount-spec=UUID={boot_uuid} /target"
-                )
-                .run()?;
-
-                    // Verify the installation succeeded
-                    // Check that bootc created the necessary files
-                    cmd!(sh, "sudo test -d {target}/ostree").run()?;
-                    cmd!(sh, "sudo test -d {target}/ostree/repo").run()?;
-                    // Verify bootloader was installed
-                    cmd!(sh, "sudo test -d {target}/boot/grub2").run()?;
-
-                    Ok(())
-                })() {
-                    let target = work_dir.join("target");
-                    let target_str = target.to_str().unwrap();
-                    cleanup(sh, &loop_dev, target_str);
-                    return Err(e.into());
-                }
-
-                // Clean up on success
-                let target = work_dir.join("target");
-                let target_str = target.to_str().unwrap();
-                cleanup(sh, &loop_dev, target_str);
-
-                Ok(())
-            },
-        ),
         Trial::test(
             "replace=alongside with ssh keys and a karg, and SELinux disabled",
             move || {
diff --git a/tmt/plans/integration.fmf b/tmt/plans/integration.fmf
index 6f9117a0..365e6618 100644
--- a/tmt/plans/integration.fmf
+++ b/tmt/plans/integration.fmf
@@ -18,6 +18,11 @@ prepare:
       - expect
       - ansible-core
       - zstd
+      # Required for test-32-install-to-filesystem-var-mount
+      - parted
+      - lvm2
+      - dosfstools
+      - e2fsprogs
     when: running_env != image_mode
   - how: shell
     order: 98
@@ -147,4 +152,11 @@ execute:
     how: fmf
     test:
       - /tmt/tests/tests/test-31-switch-to-unified
+
+/plan-32-install-to-filesystem-var-mount:
+  summary: Test bootc install to-filesystem with separate /var mount
+  discover:
+    how: fmf
+    test:
+      - /tmt/tests/tests/test-32-install-to-filesystem-var-mount
 # END GENERATED PLANS
diff --git a/tmt/tests/booted/test-install-to-filesystem-var-mount.sh b/tmt/tests/booted/test-install-to-filesystem-var-mount.sh
new file mode 100644
index 00000000..be9dd1d7
--- /dev/null
+++ b/tmt/tests/booted/test-install-to-filesystem-var-mount.sh
@@ -0,0 +1,148 @@
+# number: 32
+# tmt:
+#   summary: Test bootc install to-filesystem with separate /var mount
+#   duration: 30m
+#   require:
+#     - parted
+#     - lvm2
+#     - dosfstools
+#     - e2fsprogs
+#
+#!/bin/bash
+# Test bootc install to-filesystem with a pre-existing /var mount point.
+# This verifies that bootc correctly handles scenarios where /var is on a
+# separate filesystem, which is a common production setup for managing
+# persistent data separately from the OS.
+
+set -xeuo pipefail
+
+# Use a generic target image to test skew between the bootc binary doing
+# the install and the target image
+TARGET_IMAGE="docker://quay.io/centos-bootc/centos-bootc:stream10"
+
+echo "Testing bootc install to-filesystem with separate /var mount"
+
+# Disable SELinux enforcement for the install
+setenforce 0
+
+# Enable usr-overlay to allow modifications
+bootc usr-overlay
+
+# Install required packages (bootc images are immutable, so we need to install
+# after usr-overlay is enabled)
+dnf install -y parted lvm2 dosfstools e2fsprogs
+
+# Mask off conflicting ostree state
+if test -d /sysroot/ostree; then
+    mount --bind /usr/share/empty /sysroot/ostree
+fi
+rm -vrf /usr/lib/bootupd/updates
+rm -vrf /usr/lib/bootc/bound-images.d
+
+# Create a 12GB sparse disk image in /var/tmp (not /tmp which may be tmpfs)
+DISK_IMG=/var/tmp/disk-var-mount-test.img
+truncate -s 12G "$DISK_IMG"
+
+# Setup loop device
+LOOP_DEV=$(losetup -f --show "$DISK_IMG")
+echo "Using loop device: $LOOP_DEV"
+
+# Cleanup function
+cleanup() {
+    set +e
+    echo "Cleaning up..."
+    umount -R /var/mnt/target 2>/dev/null
+    vgchange -an BL 2>/dev/null
+    vgremove -f BL 2>/dev/null
+    losetup -d "$LOOP_DEV" 2>/dev/null
+    rm -f "$DISK_IMG" 2>/dev/null
+}
+trap cleanup EXIT
+
+# Create partition table
+parted -s "$LOOP_DEV" mklabel gpt
+# BIOS boot partition (for GRUB on GPT)
+parted -s "$LOOP_DEV" mkpart primary 1MiB 2MiB
+parted -s "$LOOP_DEV" set 1 bios_grub on
+# EFI partition (200 MiB)
+parted -s "$LOOP_DEV" mkpart primary fat32 2MiB 202MiB
+parted -s "$LOOP_DEV" set 2 esp on
+# Boot partition (1 GiB)
+parted -s "$LOOP_DEV" mkpart primary ext4 202MiB 1226MiB
+# LVM partition (rest of disk)
+parted -s "$LOOP_DEV" mkpart primary 1226MiB 100%
+
+# Reload partition table
+partprobe "$LOOP_DEV"
+sleep 2
+
+# Partition device names
+EFI_PART="${LOOP_DEV}p2"
+BOOT_PART="${LOOP_DEV}p3"
+LVM_PART="${LOOP_DEV}p4"
+
+# Create filesystems on boot partitions
+mkfs.vfat -F32 "$EFI_PART"
+mkfs.ext4 -F "$BOOT_PART"
+
+# Setup LVM
+pvcreate "$LVM_PART"
+vgcreate BL "$LVM_PART"
+
+# Create logical volumes
+lvcreate -L 4G -n var02 BL
+lvcreate -L 5G -n root02 BL
+
+# Create filesystems on logical volumes
+mkfs.ext4 -F /dev/BL/var02
+mkfs.ext4 -F /dev/BL/root02
+
+# Get UUIDs for bootc install
+ROOT_UUID=$(blkid -s UUID -o value /dev/BL/root02)
+BOOT_UUID=$(blkid -s UUID -o value "$EFI_PART")
+
+# Mount the partitions
+mkdir -p /var/mnt/target
+mount /dev/BL/root02 /var/mnt/target
+mkdir -p /var/mnt/target/boot
+mount "$BOOT_PART" /var/mnt/target/boot
+mkdir -p /var/mnt/target/boot/efi
+mount "$EFI_PART" /var/mnt/target/boot/efi
+
+# Create EFI directory structure with some files (simulating existing EFI content)
+mkdir -p /var/mnt/target/boot/efi/EFI/fedora
+touch /var/mnt/target/boot/efi/EFI/fedora/shimx64.efi
+touch /var/mnt/target/boot/efi/EFI/fedora/grubx64.efi
+
+# Critical: Mount /var as a separate partition
+mkdir -p /var/mnt/target/var
+mount /dev/BL/var02 /var/mnt/target/var
+
+echo "Filesystem layout:"
+mount | grep /var/mnt/target || true
+df -h /var/mnt/target /var/mnt/target/boot /var/mnt/target/boot/efi /var/mnt/target/var
+
+# Run bootc install to-filesystem
+# This should succeed and handle the separate /var mount correctly
+podman run \
+    --rm --privileged \
+    -v /var/mnt/target:/target \
+    -v /dev:/dev \
+    --pid=host \
+    --security-opt label=type:unconfined_t \
+    "$TARGET_IMAGE" \
+    bootc install to-filesystem \
+        --disable-selinux \
+        --karg=root=UUID="$ROOT_UUID" \
+        --root-mount-spec=UUID="$ROOT_UUID" \
+        --boot-mount-spec=UUID="$BOOT_UUID" \
+        /target
+
+# Verify the installation succeeded
+echo "Verifying installation..."
+test -d /var/mnt/target/ostree
+test -d /var/mnt/target/ostree/repo
+# Verify bootloader was installed (grub2 or loader for different configurations)
+test -d /var/mnt/target/boot/grub2 || test -d /var/mnt/target/boot/loader
+
+echo "Installation to-filesystem with separate /var mount succeeded!"
diff --git a/tmt/tests/tests.fmf b/tmt/tests/tests.fmf
index eb715ce8..6344deb0 100644
--- a/tmt/tests/tests.fmf
+++ b/tmt/tests/tests.fmf
@@ -79,3 +79,13 @@
   summary: Onboard to unified storage, build derived image, and switch to it
   duration: 30m
   test: nu booted/test-switch-to-unified.nu
+
+/test-32-install-to-filesystem-var-mount:
+  summary: Test bootc install to-filesystem with separate /var mount
+  duration: 30m
+  require:
+    - parted
+    - lvm2
+    - dosfstools
+    - e2fsprogs
+  test: bash booted/test-install-to-filesystem-var-mount.sh