diff --git a/build_image b/build_image
index c4feaf530e..3783351ea8 100755
--- a/build_image
+++ b/build_image
@@ -123,7 +123,7 @@ parse_build_image_args
 EXTRA_PACKAGES=""
 if [ ${FLAGS_factory_install} -eq ${FLAGS_TRUE} ]; then
   # TODO: Build a separated ebuild for the install shim to reduce size.
-  INSTALL_MASK="${INSTALL_MASK} ${FACTORY_INSTALL_MASK}"
+  INSTALL_MASK="${FACTORY_SHIM_INSTALL_MASK}"
 
   # Reduce the size of factory install shim.
   info "Fixing the rootfs size at 320 MiB for install shim"
diff --git a/build_library/test_image_util.sh b/build_library/test_image_util.sh
index 67573d5044..ead04a08db 100755
--- a/build_library/test_image_util.sh
+++ b/build_library/test_image_util.sh
@@ -98,37 +98,6 @@ prepare_hwid_for_factory() {
   fi
 }
 
-install_autotest_for_factory() {
-  local autotest_src="${BOARD_ROOT}/usr/local/autotest"
-  local stateful_root="${ROOT_FS_DIR}/usr/local"
-  local autotest_client="${stateful_root}/autotest"
-
-  echo "Install autotest into stateful partition from ${autotest_src}"
-
-  sudo mkdir -p "${autotest_client}"
-
-  # Remove excess files from stateful partition.
-  sudo rm -rf "${autotest_client}/"*
-  sudo rm -rf "${stateful_root}/autotest-pkgs"
-  sudo rm -rf "${stateful_root}/lib/icedtea6"
-
-  sudo rsync --delete --delete-excluded -au \
-    --exclude=deps/realtimecomm_playground \
-    --exclude=tests/ltp \
-    --exclude=site_tests/graphics_O3DSelenium \
-    --exclude=site_tests/realtimecomm_GTalk\* \
-    --exclude=site_tests/platform_StackProtector \
-    --exclude=deps/chrome_test \
-    --exclude=site_tests/desktopui_BrowserTest \
-    --exclude=site_tests/desktopui_PageCyclerTests \
-    --exclude=site_tests/desktopui_UITest \
-    --exclude=.svn \
-    "${autotest_src}/client/"* "${autotest_client}"
-
-  sudo chmod 755 "${autotest_client}"
-  sudo chown -R 1000:1000 "${autotest_client}"
-}
-
 # Converts a dev image into a test or factory test image
 # Takes as an arg the name of the image to be created.
 mod_image_for_test () {
@@ -153,9 +122,10 @@ mod_image_for_test () {
 
   if [ ${FLAGS_factory} -eq ${FLAGS_TRUE} ]; then
     emerge_to_image --root="${ROOT_FS_DIR}" factorytest-init
-
+    INSTALL_MASK="${FACTORY_TEST_INSTALL_MASK}"
+    emerge_to_image --root="${ROOT_FS_DIR}/usr/local" \
+      chromeos-base/autotest chromeos-base/autotest-all
     prepare_hwid_for_factory "${BUILD_DIR}"
-    install_autotest_for_factory
 
     local mod_factory_script
     mod_factory_script="${SCRIPTS_DIR}/mod_for_factory_scripts/factory_setup.sh"
diff --git a/common.sh b/common.sh
index a4f1d9b292..4e3d1f3cba 100644
--- a/common.sh
+++ b/common.sh
@@ -170,7 +170,7 @@ CHROOT_TRUNK_DIR="/home/$USER/trunk"
 
 # Install make for portage ebuilds.  Used by build_image and gmergefs.
 # TODO: Is /usr/local/autotest-chrome still used by anyone?
-DEFAULT_INSTALL_MASK="
+COMMON_INSTALL_MASK="
   *.a
   *.la
   /etc/init.d
@@ -183,7 +183,6 @@ DEFAULT_INSTALL_MASK="
   /usr/lib/gcc
   /usr/lib/gtk-2.0/include
   /usr/lib/pkgconfig
-  /usr/local/autotest
   /usr/local/autotest-chrome
   /usr/man
   /usr/share/aclocal
@@ -199,18 +198,38 @@ DEFAULT_INSTALL_MASK="
   /usr/src
   "
 
-FACTORY_INSTALL_MASK="
-  /opt/Qualcomm
-  /opt/Synaptics
+# Mask for base, dev, and test images (build_image, build_image --test)
+DEFAULT_INSTALL_MASK="
+  $COMMON_INSTALL_MASK
+  /usr/local/autotest
+  "
+
+# Mask for factory test image (build_image --factory)
+FACTORY_TEST_INSTALL_MASK="
+  $COMMON_INSTALL_MASK
+  */.svn
+  */CVS
+  /usr/local/autotest/[^c]*
+  /usr/local/autotest/conmux
+  /usr/local/autotest/client/deps/chrome_test
+  /usr/local/autotest/client/deps/piglit
+  /usr/local/autotest/client/deps/pyauto_dep
+  /usr/local/autotest/client/deps/realtimecomm_*
+  /usr/local/autotest/client/site_tests/desktopui_PageCyclerTests
+  /usr/local/autotest/client/site_tests/graphics_WebGLConformance
+  /usr/local/autotest/client/site_tests/platform_ToolchainOptions
+  /usr/local/autotest/client/site_tests/realtimecomm_GTalk*
+  "
+
+# Mask for factory install shim (build_image --factory_install)
+FACTORY_SHIM_INSTALL_MASK="
+  $DEFAULT_INSTALL_MASK
+  /opt/[^g]*
   /opt/google/chrome
   /opt/google/o3d
   /opt/google/talkplugin
-  /opt/netscape
-  /usr/lib/debug
   /usr/lib/dri
   /usr/lib/python2.6/test
-  /usr/local/autotest
-  /usr/local/autotest-chrome
   /usr/local/autotest-pkgs
   /usr/share/X11
   /usr/share/chewing
diff --git a/mod_for_factory_scripts/100rebaseClient b/mod_for_factory_scripts/100rebaseClient
new file mode 100755
index 0000000000..b217c29043
--- /dev/null
+++ b/mod_for_factory_scripts/100rebaseClient
@@ -0,0 +1,18 @@
+#!/bin/bash
+
+# Copyright (c) 2011 The Chromium OS Authors. All rights reserved.
+# Use of this source code is governed by a BSD-style license that can be
+# found in the LICENSE file.
+
+die() {
+  echo "ERROR: $*"
+  exit 1
+}
+
+echo "Rebasing autotest/client folder for factory."
+base_dir="${ROOT_FS_DIR}/usr/local/autotest"
+
+[ -d "${base_dir}/client" ] || die "Missing client in root: ${base_dir}"
+mv "${base_dir}/client/"* "${base_dir}" || die "Failed moving client folder."
+rmdir "${base_dir}/client" || die "Failed removing client folder."
+ln -s . "${base_dir}/client" || die "Failed creating symlink."