diff --git a/include/onnxruntime/core/session/onnxruntime_session_options_config_keys.h b/include/onnxruntime/core/session/onnxruntime_session_options_config_keys.h
index 89a87a02276db..efe628b354811 100644
--- a/include/onnxruntime/core/session/onnxruntime_session_options_config_keys.h
+++ b/include/onnxruntime/core/session/onnxruntime_session_options_config_keys.h
@@ -250,6 +250,12 @@ static const char* const kOrtSessionOptionsOptimizedModelExternalInitializersFil
 static const char* const kOrtSessionOptionsOptimizedModelExternalInitializersMinSizeInBytes =
     "session.optimized_model_external_initializers_min_size_in_bytes";
 
+// When loading model from memory buffer and the model has external initializers
+// Use this config to set the external data file folder path
+// All external data files should be in the same folder
+static const char* const kOrtSessionOptionsModelExternalInitializersFileFolderPath =
+    "session.model_external_initializers_file_folder_path";
+
 // Use this config when saving pre-packed constant initializers to an external data file.
 // This allows you to memory map pre-packed initializers on model load and leave it to
 // to the OS the amount of memory consumed by the pre-packed initializers. Otherwise,
diff --git a/onnxruntime/core/session/inference_session.cc b/onnxruntime/core/session/inference_session.cc
index 26ffeb93ab3b6..afd1e24bd4742 100644
--- a/onnxruntime/core/session/inference_session.cc
+++ b/onnxruntime/core/session/inference_session.cc
@@ -1090,7 +1090,14 @@ common::Status InferenceSession::Load(const void* model_data, int model_data_len
 
     const bool strict_shape_type_inference = session_options_.config_options.GetConfigOrDefault(
                                                  kOrtSessionOptionsConfigStrictShapeTypeInference, "0") == "1";
-    return onnxruntime::Model::Load(std::move(model_proto), PathString(), model,
+
+    std::string external_data_folder_path = session_options_.config_options.GetConfigOrDefault(
+        kOrtSessionOptionsModelExternalInitializersFileFolderPath, "");
+    if (!external_data_folder_path.empty() && model_location_.empty()) {
+      model_location_ = ToPathString(external_data_folder_path + "/virtual_model.onnx");
+    }
+
+    return onnxruntime::Model::Load(std::move(model_proto), model_location_, model,
                                     HasLocalSchema() ? &custom_schema_registries_ : nullptr, *session_logger_,
                                     ModelOptions(true, strict_shape_type_inference));
   };
@@ -1120,8 +1127,15 @@ common::Status InferenceSession::LoadOnnxModel(ModelProto model_proto) {
 #endif
     const bool strict_shape_type_inference = session_options_.config_options.GetConfigOrDefault(
                                                  kOrtSessionOptionsConfigStrictShapeTypeInference, "0") == "1";
+
+    std::string external_data_folder_path = session_options_.config_options.GetConfigOrDefault(
+        kOrtSessionOptionsModelExternalInitializersFileFolderPath, "");
+    if (!external_data_folder_path.empty() && model_location_.empty()) {
+      model_location_ = ToPathString(external_data_folder_path + "/virtual_model.onnx");
+    }
+
     // This call will move model_proto to the constructed model instance
-    return onnxruntime::Model::Load(std::move(model_proto), PathString(), model,
+    return onnxruntime::Model::Load(std::move(model_proto), model_location_, model,
                                     HasLocalSchema() ? &custom_schema_registries_ : nullptr, *session_logger_,
                                     ModelOptions(true, strict_shape_type_inference));
   };
@@ -1157,7 +1171,14 @@ common::Status InferenceSession::Load(std::istream& model_istream, bool allow_re
                                                  kOrtSessionOptionsConfigStrictShapeTypeInference, "0") == "1";
     ModelOptions model_opts(allow_released_opsets_only,
                             strict_shape_type_inference);
-    return onnxruntime::Model::Load(std::move(model_proto), PathString(), model,
+
+    std::string external_data_folder_path = session_options_.config_options.GetConfigOrDefault(
+        kOrtSessionOptionsModelExternalInitializersFileFolderPath, "");
+    if (!external_data_folder_path.empty() && model_location_.empty()) {
+      model_location_ = ToPathString(external_data_folder_path + "/virtual_model.onnx");
+    }
+
+    return onnxruntime::Model::Load(std::move(model_proto), model_location_, model,
                                     HasLocalSchema() ? &custom_schema_registries_ : nullptr,
                                     *session_logger_, model_opts);
   };
diff --git a/onnxruntime/test/shared_lib/test_model_loading.cc b/onnxruntime/test/shared_lib/test_model_loading.cc
index 5694398b9cb10..89b12ec61649e 100644
--- a/onnxruntime/test/shared_lib/test_model_loading.cc
+++ b/onnxruntime/test/shared_lib/test_model_loading.cc
@@ -215,6 +215,52 @@ TEST(CApiTest, TestLoadModelFromArrayWithExternalInitializersFromFileArrayPathRo
 #endif
 }
 
+// The model has external data, Test loading model from array
+// Extra API required to set the external data path
+TEST(CApiTest, TestLoadModelFromArrayWithExternalInitializersViaSetExternalDataPath) {
+  std::string model_file_name = "conv_qdq_external_ini.onnx";
+  std::string external_bin_name = "conv_qdq_external_ini.bin";
+  std::string test_folder = "testdata/";
+  std::string model_path = test_folder + model_file_name;
+  std::vector<char> buffer;
+  ReadFileToBuffer(model_path.c_str(), buffer);
+
+  std::vector<char> external_bin_buffer;
+  std::string external_bin_path = test_folder + external_bin_name;
+  ReadFileToBuffer(external_bin_path.c_str(), external_bin_buffer);
+
+  Ort::SessionOptions so;
+  std::string optimized_model_file_name(model_file_name);
+  auto length = optimized_model_file_name.length();
+  optimized_model_file_name.insert(length - 5, "_opt");
+  std::string optimized_file_path(test_folder + optimized_model_file_name);
+  PathString optimized_file_path_t(optimized_file_path.begin(), optimized_file_path.end());
+
+  //  Dump the optimized model with external data so that it will unpack the external data from the loaded model
+  so.SetOptimizedModelFilePath(optimized_file_path_t.c_str());
+
+  // set the model external file folder path
+  so.AddConfigEntry(kOrtSessionOptionsModelExternalInitializersFileFolderPath, test_folder.c_str());
+
+  std::string opt_bin_file_name(optimized_model_file_name);
+  opt_bin_file_name.replace(optimized_model_file_name.length() - 4, 4, "bin");
+  so.SetGraphOptimizationLevel(GraphOptimizationLevel::ORT_DISABLE_ALL);
+  so.AddConfigEntry(kOrtSessionOptionsOptimizedModelExternalInitializersFileName, opt_bin_file_name.c_str());
+  so.AddConfigEntry(kOrtSessionOptionsOptimizedModelExternalInitializersMinSizeInBytes, "10");
+
+  Ort::Session session(*ort_env.get(), buffer.data(), buffer.size(), so);
+
+  std::string generated_bin_path = test_folder + opt_bin_file_name;
+  std::vector<char> generated_bin_buffer;
+  ReadFileToBuffer(generated_bin_path.c_str(), generated_bin_buffer);
+
+  ASSERT_EQ(external_bin_buffer, generated_bin_buffer);
+
+  // Cleanup.
+  ASSERT_EQ(std::remove(optimized_file_path.c_str()), 0);
+  ASSERT_EQ(std::remove(generated_bin_path.c_str()), 0);
+}
+
 #ifndef _WIN32
 struct FileDescriptorTraits {
   using Handle = int;