diff --git a/sdk_container/src/third_party/coreos-overlay/coreos/user-patches/sys-libs/libsemanage/README.md b/sdk_container/src/third_party/coreos-overlay/coreos/user-patches/sys-libs/libsemanage/README.md
new file mode 100644
index 0000000000..a3e6280660
--- /dev/null
+++ b/sdk_container/src/third_party/coreos-overlay/coreos/user-patches/sys-libs/libsemanage/README.md
@@ -0,0 +1,4 @@
+We have a patch that modifies the semanage.conf file that is
+previously modified by the Gentoo ebuild. The patch enables the
+SELinux module compression to save some disk space (the modules went
+from 33MB to 3MB).
diff --git a/sdk_container/src/third_party/coreos-overlay/coreos/user-patches/sys-libs/libsemanage/compress-modules.patch b/sdk_container/src/third_party/coreos-overlay/coreos/user-patches/sys-libs/libsemanage/compress-modules.patch
new file mode 100644
index 0000000000..488f44555d
--- /dev/null
+++ b/sdk_container/src/third_party/coreos-overlay/coreos/user-patches/sys-libs/libsemanage/compress-modules.patch
@@ -0,0 +1,12 @@
+diff -r -u libsemanage-3.6-patched/src/semanage.conf libsemanage-3.6-flatcar/src/semanage.conf
+--- libsemanage-3.6-patched/src/semanage.conf	2024-02-21 14:33:06.055611733 +0100
++++ libsemanage-3.6-flatcar/src/semanage.conf	2024-02-21 14:42:13.566991009 +0100
+@@ -58,7 +58,7 @@
+ # 1-9 when compressing.  The higher the number,
+ # the more memory is traded off for disk space.
+ # Set to 0 to disable bzip2 compression.
+-bzip-blocksize=0
++bzip-blocksize=1
+ 
+ # Reduce memory usage for bzip2 compression and
+ # decompression of modules in the module store.