diff --git a/sdk_container/src/third_party/coreos-overlay/changelog/changes/2022-04-13-hostname-setup-with-afterburn.md b/sdk_container/src/third_party/coreos-overlay/changelog/changes/2022-04-13-hostname-setup-with-afterburn.md
new file mode 100644
index 0000000000..9e0b767028
--- /dev/null
+++ b/sdk_container/src/third_party/coreos-overlay/changelog/changes/2022-04-13-hostname-setup-with-afterburn.md
@@ -0,0 +1,2 @@
+- Azure: Set up `/etc/hostname` from instance metadata with Afterburn
+- AWS EC2: Removed the setup of `/etc/hostname` from the instance metadata because it used a long FQDN but we can just use use the hostname set via DHCP ([Flatcar#707](https://github.com/flatcar-linux/Flatcar/issues/707))
diff --git a/sdk_container/src/third_party/coreos-overlay/sys-kernel/bootengine/bootengine-9999.ebuild b/sdk_container/src/third_party/coreos-overlay/sys-kernel/bootengine/bootengine-9999.ebuild
index f8f080f46f..9e1568da43 100644
--- a/sdk_container/src/third_party/coreos-overlay/sys-kernel/bootengine/bootengine-9999.ebuild
+++ b/sdk_container/src/third_party/coreos-overlay/sys-kernel/bootengine/bootengine-9999.ebuild
@@ -10,7 +10,7 @@ CROS_WORKON_REPO="https://github.com"
 if [[ "${PV}" == 9999 ]]; then
 	KEYWORDS="~amd64 ~arm ~arm64 ~x86"
 else
-	CROS_WORKON_COMMIT="85d325684c5c7817aad230b801f302903e9c6f69" # flatcar-master
+	CROS_WORKON_COMMIT="110ddbf154f73a98e378f698eb40354d2429ec92" # flatcar-master
 	KEYWORDS="amd64 arm arm64 x86"
 fi