diff --git a/pkg/cidata/cidata.TEMPLATE.d/boot/02-wsl2-setup.sh b/pkg/cidata/cidata.TEMPLATE.d/boot/02-no-cloud-init.sh
similarity index 92%
rename from pkg/cidata/cidata.TEMPLATE.d/boot/02-wsl2-setup.sh
rename to pkg/cidata/cidata.TEMPLATE.d/boot/02-no-cloud-init.sh
index cb5639657d3..0a4d86f42d1 100755
--- a/pkg/cidata/cidata.TEMPLATE.d/boot/02-wsl2-setup.sh
+++ b/pkg/cidata/cidata.TEMPLATE.d/boot/02-no-cloud-init.sh
@@ -4,8 +4,8 @@
 # SPDX-License-Identifier: Apache-2.0
 
 # This script replaces the cloud-init functionality of creating a user and setting its SSH keys
-# when using a WSL2 VM.
-[ "$LIMA_CIDATA_VMTYPE" = "wsl2" ] || exit 0
+# when cloud-init is not available
+[ "$LIMA_CIDATA_NO_CLOUD_INIT" = "1" ] || exit 0
 
 # create user
 # shellcheck disable=SC2153
diff --git a/pkg/cidata/cidata.TEMPLATE.d/lima.env b/pkg/cidata/cidata.TEMPLATE.d/lima.env
index 89d2d34f108..d4ec3ef943b 100644
--- a/pkg/cidata/cidata.TEMPLATE.d/lima.env
+++ b/pkg/cidata/cidata.TEMPLATE.d/lima.env
@@ -59,3 +59,8 @@ LIMA_CIDATA_PLAIN=1
 {{- else}}
 LIMA_CIDATA_PLAIN=
 {{- end}}
+{{- if .NoCloudInit}}
+LIMA_CIDATA_NO_CLOUD_INIT=1
+{{- else}}
+LIMA_CIDATA_NO_CLOUD_INIT=
+{{- end}}
diff --git a/pkg/cidata/cidata.go b/pkg/cidata/cidata.go
index 0a8c57aa9c9..513a1e8b549 100644
--- a/pkg/cidata/cidata.go
+++ b/pkg/cidata/cidata.go
@@ -116,6 +116,11 @@ func setupEnv(instConfigEnv map[string]string, propagateProxyEnv bool, slirpGate
 	return env, nil
 }
 
+func useCloudInit(instConfig *limayaml.LimaYAML) bool {
+	// all drivers but WSL2 use cloud-init
+	return *instConfig.VMType != limayaml.WSL2
+}
+
 func templateArgs(ctx context.Context, bootScripts bool, instDir, name string, instConfig *limayaml.LimaYAML, udpDNSLocalPort, tcpDNSLocalPort, vsockPort int, virtioPort string) (*TemplateArgs, error) {
 	if err := limayaml.Validate(instConfig, false); err != nil {
 		return nil, err
@@ -143,6 +148,7 @@ func templateArgs(ctx context.Context, bootScripts bool, instDir, name string, i
 		VirtioPort:     virtioPort,
 		Plain:          *instConfig.Plain,
 		TimeZone:       *instConfig.TimeZone,
+		NoCloudInit:    !useCloudInit(instConfig),
 		Param:          instConfig.Param,
 	}
 
@@ -433,7 +439,7 @@ func GenerateISO9660(ctx context.Context, instDir, name string, instConfig *lima
 		})
 	}
 
-	if args.VMType == limayaml.WSL2 {
+	if !useCloudInit(instConfig) {
 		layout = append(layout, iso9660util.Entry{
 			Path:   "ssh_authorized_keys",
 			Reader: strings.NewReader(strings.Join(args.SSHPubKeys, "\n")),
diff --git a/pkg/cidata/template.go b/pkg/cidata/template.go
index 33825b3ba18..8d84c55f085 100644
--- a/pkg/cidata/template.go
+++ b/pkg/cidata/template.go
@@ -105,6 +105,7 @@ type TemplateArgs struct {
 	VirtioPort                      string
 	Plain                           bool
 	TimeZone                        string
+	NoCloudInit                     bool
 }
 
 func ValidateTemplateArgs(args *TemplateArgs) error {