diff --git a/src/pylorax/__init__.py b/src/pylorax/__init__.py
index 0d994224..a0be8db6 100644
--- a/src/pylorax/__init__.py
+++ b/src/pylorax/__init__.py
@@ -219,14 +219,15 @@ class Lorax(BaseLoraxClass):
         rb.cleanup()
 
         logger.info("creating the runtime image")
-        runtime = joinpaths(self.workdir, "install.img")
+        # NOTE: dracut dmsquash-live-root requires image named "*squashfs.img"
+        runtime = "images/anaconda-squashfs.img"
         # FIXME: compression options (type, speed, etc.)
-        rb.create_runtime(runtime)
+        rb.create_runtime(joinpaths(installroot,runtime))
 
         logger.info("preparing to build output tree and boot images")
         treebuilder = TreeBuilder(product=self.product, arch=self.arch,
                                   inroot=installroot, outroot=self.outputdir,
-                                  templatedir=templatedir)
+                                  runtime=runtime, templatedir=templatedir)
 
         logger.info("rebuilding initramfs images")
         treebuilder.rebuild_initrds(add_args=["--xz"])
diff --git a/src/pylorax/treebuilder.py b/src/pylorax/treebuilder.py
index 4bddbe2c..ad155bc4 100644
--- a/src/pylorax/treebuilder.py
+++ b/src/pylorax/treebuilder.py
@@ -142,9 +142,9 @@ class RuntimeBuilder(object):
 class TreeBuilder(object):
     '''Builds the arch-specific boot images.
     inroot should be the installtree root (the newly-built runtime dir)'''
-    def __init__(self, product, arch, inroot, outroot, templatedir=None):
+    def __init__(self, product, arch, inroot, outroot, runtime, templatedir=None):
         v = DataHolder(arch=arch, product=product,
-                       inroot=inroot, outroot=outroot,
+                       inroot=inroot, outroot=outroot, runtime=runtime,
                        basearch=arch.basearch, libdir=arch.libdir,
                        exists = lambda p: _exists(p, root=inroot))
         self.vars = v