diff --git a/src/cloud-api-adaptor/pkg/paths/paths.go b/src/cloud-api-adaptor/pkg/paths/paths.go
index e5b76414b..1a389c46f 100644
--- a/src/cloud-api-adaptor/pkg/paths/paths.go
+++ b/src/cloud-api-adaptor/pkg/paths/paths.go
@@ -1,11 +1,12 @@
 package paths
 
 const (
-	AACfgPath        = "/run/peerpod/aa.toml"
-	AuthFilePath     = "/run/peerpod/auth.json"
-	CDHCfgPath       = "/run/peerpod/cdh.toml"
-	InitDataPath     = "/run/peerpod/initdata"
-	AgentCfgPath     = "/run/peerpod/agent-config.toml"
-	ForwarderCfgPath = "/run/peerpod/daemon.json"
-	UserDataPath     = "/run/media/cidata/user-data"
+	AACfgPath          = "/run/peerpod/aa.toml"
+	AuthFilePath       = "/run/peerpod/auth.json"
+	CDHCfgPath         = "/run/peerpod/cdh.toml"
+	InitDataPath       = "/run/peerpod/initdata"
+	AgentCfgPath       = "/run/peerpod/agent-config.toml"
+	ForwarderCfgPath   = "/run/peerpod/daemon.json"
+	UserDataPath       = "/run/media/cidata/user-data"
+	DockerUserDataPath = "/media/cidata/user-data"
 )
diff --git a/src/cloud-api-adaptor/pkg/userdata/heuristics.go b/src/cloud-api-adaptor/pkg/userdata/heuristics.go
index f014df35a..d7dc09166 100644
--- a/src/cloud-api-adaptor/pkg/userdata/heuristics.go
+++ b/src/cloud-api-adaptor/pkg/userdata/heuristics.go
@@ -29,9 +29,16 @@ func isGCPVM(ctx context.Context) bool {
 }
 
 func hasUserDataFile() bool {
-	_, err := os.Stat(UserDataPath)
-	if err != nil && os.IsNotExist(err) {
-		return false
+	paths := []string{
+		UserDataPath,
+		DockerUserDataPath,
+	}
+
+	for _, path := range paths {
+		if _, err := os.Stat(path); err == nil {
+			return true // Found at least one existing file
+		}
 	}
-	return true
+	return false // Neither file exists
+
 }
diff --git a/src/cloud-api-adaptor/pkg/userdata/provision.go b/src/cloud-api-adaptor/pkg/userdata/provision.go
index 830d99740..95f6bfbb8 100644
--- a/src/cloud-api-adaptor/pkg/userdata/provision.go
+++ b/src/cloud-api-adaptor/pkg/userdata/provision.go
@@ -109,6 +109,11 @@ type FileUserDataProvider struct{ DefaultRetry }
 
 func (a FileUserDataProvider) GetUserData(ctx context.Context) ([]byte, error) {
 	path := UserDataPath
+
+	if _, err := os.Stat(UserDataPath); os.IsNotExist(err) {
+		path = DockerUserDataPath
+	}
+
 	logger.Printf("provider: File, userDataPath: %s\n", path)
 	userData, err := os.ReadFile(path)
 	if err != nil {
diff --git a/src/cloud-providers/docker/provider.go b/src/cloud-providers/docker/provider.go
index 6a07e7ed7..0728de7ae 100644
--- a/src/cloud-providers/docker/provider.go
+++ b/src/cloud-providers/docker/provider.go
@@ -77,7 +77,8 @@ func (p *dockerProvider) CreateInstance(ctx context.Context, podName, sandboxID
 	// /run/peerpods/daemon.json at runtime
 	volumeBinding := []string{
 		// note: we are not importing that path from the CAA package to avoid circular dependencies
-		fmt.Sprintf("%s:%s", instanceUserdataFile, "/run/media/cidata/user-data"),
+		// Docker volume bind mounts is not working for tpmfs mounts inside the container
+		fmt.Sprintf("%s:%s", instanceUserdataFile, "/media/cidata/user-data"),
 	}
 
 	// Add host bind mount for /run/kata-containers and /run/image to avoid