diff --git a/nixos/doc/manual/release-notes/rl-2003.xml b/nixos/doc/manual/release-notes/rl-2003.xml
index c84bc8dbb37..2bbc42bbec6 100644
--- a/nixos/doc/manual/release-notes/rl-2003.xml
+++ b/nixos/doc/manual/release-notes/rl-2003.xml
@@ -73,7 +73,7 @@
 
   <itemizedlist>
    <listitem>
-    <para />
+     <para>SD images are now compressed by default using <literal>bzip2</literal>.</para>
    </listitem>
   </itemizedlist>
  </section>
diff --git a/nixos/modules/installer/cd-dvd/sd-image.nix b/nixos/modules/installer/cd-dvd/sd-image.nix
index a2a8e8ef752..d510f3b2daf 100644
--- a/nixos/modules/installer/cd-dvd/sd-image.nix
+++ b/nixos/modules/installer/cd-dvd/sd-image.nix
@@ -98,6 +98,16 @@ in
         populate the ./files/boot (/boot) directory.
       '';
     };
+
+    compressImage = mkOption {
+      type = types.bool;
+      default = true;
+      description = ''
+        Whether the SD image should be compressed using
+        <command>bzip2</command>.
+      '';
+    };
+
   };
 
   config = {
@@ -118,10 +128,12 @@ in
 
     sdImage.storePaths = [ config.system.build.toplevel ];
 
-    system.build.sdImage = pkgs.callPackage ({ stdenv, dosfstools, e2fsprogs, mtools, libfaketime, utillinux }: stdenv.mkDerivation {
+    system.build.sdImage = pkgs.callPackage ({ stdenv, dosfstools, e2fsprogs, mtools, libfaketime, utillinux, bzip2 }: stdenv.mkDerivation {
       name = config.sdImage.imageName;
 
-      nativeBuildInputs = [ dosfstools e2fsprogs mtools libfaketime utillinux ];
+      nativeBuildInputs = [ dosfstools e2fsprogs mtools libfaketime utillinux bzip2 ];
+
+      inherit (config.sdImage) compressImage;
 
       buildCommand = ''
         mkdir -p $out/nix-support $out/sd-image
@@ -168,6 +180,9 @@ in
         # Verify the FAT partition before copying it.
         fsck.vfat -vn firmware_part.img
         dd conv=notrunc if=firmware_part.img of=$img seek=$START count=$SECTORS
+        if test -n "$compressImage"; then
+            bzip2 $img
+        fi
       '';
     }) {};