diff --git a/crates/lib/src/install.rs b/crates/lib/src/install.rs
index a1e5b2b71..a143cd393 100644
--- a/crates/lib/src/install.rs
+++ b/crates/lib/src/install.rs
@@ -1803,6 +1803,46 @@ pub(crate) async fn install_to_disk(mut opts: InstallToDiskOpts) -> Result<()> {
     Ok(())
 }
 
+/// Require that a directory contains only mount points recursively.
+/// Returns Ok(()) if all entries in the directory tree are either:
+/// - Mount points (on different filesystems)
+/// - Directories that themselves contain only mount points (recursively)
+/// - The lost+found directory
+///
+/// Returns an error if any non-mount entry is found.
+///
+/// This handles cases like /var containing /var/lib (not a mount) which contains
+/// /var/lib/containers (a mount point).
+#[context("Requiring directory contains only mount points")]
+fn require_dir_contains_only_mounts(parent_fd: &Dir, dir_name: &str) -> Result<()> {
+    let Some(dir_fd) = parent_fd.open_dir_noxdev(dir_name)? else {
+        // The directory itself is a mount point
+        return Ok(());
+    };
+
+    if dir_fd.entries()?.next().is_none() {
+        anyhow::bail!("Found empty directory: {dir_name}");
+    }
+
+    for entry in dir_fd.entries()? {
+        let entry = DirEntryUtf8::from_cap_std(entry?);
+        let entry_name = entry.file_name()?;
+
+        if entry_name == LOST_AND_FOUND {
+            continue;
+        }
+
+        let etype = entry.file_type()?;
+        if etype == FileType::dir() && dir_fd.open_dir_noxdev(&entry_name)?.is_some() {
+            require_dir_contains_only_mounts(&dir_fd, &entry_name)?;
+        } else {
+            anyhow::bail!("Found entry in {dir_name}: {entry_name}");
+        }
+    }
+
+    Ok(())
+}
+
 #[context("Verifying empty rootfs")]
 fn require_empty_rootdir(rootfs_fd: &Dir) -> Result<()> {
     for e in rootfs_fd.entries()? {
@@ -1811,17 +1851,11 @@ fn require_empty_rootdir(rootfs_fd: &Dir) -> Result<()> {
         if name == LOST_AND_FOUND {
             continue;
         }
-        // There must be a boot directory (that is empty)
-        if name == BOOT {
-            let mut entries = rootfs_fd.read_dir(BOOT)?;
-            if let Some(e) = entries.next() {
-                let e = DirEntryUtf8::from_cap_std(e?);
-                let name = e.file_name()?;
-                if matches!(name.as_str(), LOST_AND_FOUND | crate::bootloader::EFI_DIR) {
-                    continue;
-                }
-                anyhow::bail!("Non-empty boot directory, found {name}");
-            }
+
+        // Check if this entry is a directory
+        let etype = e.file_type()?;
+        if etype == FileType::dir() {
+            require_dir_contains_only_mounts(rootfs_fd, &name)?;
         } else {
             anyhow::bail!("Non-empty root filesystem; found {name:?}");
         }
@@ -2573,4 +2607,79 @@ UUID=boot-uuid /boot ext4 defaults 0 0
 
         Ok(())
     }
+
+    #[test]
+    fn test_require_dir_contains_only_mounts() -> Result<()> {
+        // Test 1: Empty directory should fail (not a mount point)
+        {
+            let td = cap_std_ext::cap_tempfile::TempDir::new(cap_std::ambient_authority())?;
+            td.create_dir("empty")?;
+            assert!(require_dir_contains_only_mounts(&td, "empty").is_err());
+        }
+
+        // Test 2: Directory with only lost+found should succeed (lost+found is ignored)
+        {
+            let td = cap_std_ext::cap_tempfile::TempDir::new(cap_std::ambient_authority())?;
+            td.create_dir_all("var/lost+found")?;
+            assert!(require_dir_contains_only_mounts(&td, "var").is_ok());
+        }
+
+        // Test 3: Directory with a regular file should fail
+        {
+            let td = cap_std_ext::cap_tempfile::TempDir::new(cap_std::ambient_authority())?;
+            td.create_dir("var")?;
+            td.write("var/test.txt", b"content")?;
+            assert!(require_dir_contains_only_mounts(&td, "var").is_err());
+        }
+
+        // Test 4: Nested directory structure with a file should fail
+        {
+            let td = cap_std_ext::cap_tempfile::TempDir::new(cap_std::ambient_authority())?;
+            td.create_dir_all("var/lib/containers")?;
+            td.write("var/lib/containers/storage.db", b"data")?;
+            assert!(require_dir_contains_only_mounts(&td, "var").is_err());
+        }
+
+        // Test 5: boot directory with grub should fail (grub2 is not a mount and contains files)
+        {
+            let td = cap_std_ext::cap_tempfile::TempDir::new(cap_std::ambient_authority())?;
+            td.create_dir_all("boot/grub2")?;
+            td.write("boot/grub2/grub.cfg", b"config")?;
+            assert!(require_dir_contains_only_mounts(&td, "boot").is_err());
+        }
+
+        // Test 6: Nested empty directories should fail (empty directories are not mount points)
+        {
+            let td = cap_std_ext::cap_tempfile::TempDir::new(cap_std::ambient_authority())?;
+            td.create_dir_all("var/lib/containers")?;
+            td.create_dir_all("var/log/journal")?;
+            assert!(require_dir_contains_only_mounts(&td, "var").is_err());
+        }
+
+        // Test 7: Directory with lost+found and a file should fail (lost+found is ignored, but file is not allowed)
+        {
+            let td = cap_std_ext::cap_tempfile::TempDir::new(cap_std::ambient_authority())?;
+            td.create_dir_all("var/lost+found")?;
+            td.write("var/data.txt", b"content")?;
+            assert!(require_dir_contains_only_mounts(&td, "var").is_err());
+        }
+
+        // Test 8: Directory with a symlink should fail
+        {
+            let td = cap_std_ext::cap_tempfile::TempDir::new(cap_std::ambient_authority())?;
+            td.create_dir("var")?;
+            td.symlink_contents("../usr/lib", "var/lib")?;
+            assert!(require_dir_contains_only_mounts(&td, "var").is_err());
+        }
+
+        // Test 9: Deeply nested directory with a file should fail
+        {
+            let td = cap_std_ext::cap_tempfile::TempDir::new(cap_std::ambient_authority())?;
+            td.create_dir_all("var/lib/containers/storage/overlay")?;
+            td.write("var/lib/containers/storage/overlay/file.txt", b"data")?;
+            assert!(require_dir_contains_only_mounts(&td, "var").is_err());
+        }
+
+        Ok(())
+    }
 }
diff --git a/crates/tests-integration/src/install.rs b/crates/tests-integration/src/install.rs
index aeef12c8d..8487c0354 100644
--- a/crates/tests-integration/src/install.rs
+++ b/crates/tests-integration/src/install.rs
@@ -93,6 +93,143 @@ pub(crate) fn run_alongside(image: &str, mut testargs: libtest_mimic::Arguments)
             cmd!(sh, "sudo {BASE_ARGS...} -v {tmpdisk}:/disk {image} bootc install to-disk --via-loopback /disk").run()?;
             Ok(())
         }),
+        Trial::test(
+            "install to-filesystem with separate /var mount",
+            move || {
+                let sh = &xshell::Shell::new()?;
+                reset_root(sh, image)?;
+
+                // Create work directory for the test
+                let tmpd = sh.create_temp_dir()?;
+                let work_dir = tmpd.path();
+
+                // Create a disk image with partitions for root and var
+                let disk_img = work_dir.join("disk.img");
+                let size = 12 * 1024 * 1024 * 1024;
+                let disk_file = std::fs::File::create(&disk_img)?;
+                disk_file.set_len(size)?;
+                drop(disk_file);
+
+                // Setup loop device
+                let loop_dev = cmd!(sh, "sudo losetup -f --show {disk_img}")
+                    .read()?
+                    .trim()
+                    .to_string();
+
+                // Helper closure for cleanup
+                let cleanup = |sh: &Shell, loop_dev: &str, target: &str| {
+                    // Unmount filesystems
+                    let _ = cmd!(sh, "sudo umount -R {target}").ignore_status().run();
+                    // Deactivate LVM
+                    let _ = cmd!(sh, "sudo vgchange -an BL").ignore_status().run();
+                    let _ = cmd!(sh, "sudo vgremove -f BL").ignore_status().run();
+                    // Detach loop device
+                    let _ = cmd!(sh, "sudo losetup -d {loop_dev}").ignore_status().run();
+                };
+
+                // Create partition table
+                if let Err(e) = (|| -> Result<()> {
+                    cmd!(sh, "sudo parted -s {loop_dev} mklabel gpt").run()?;
+                    // Create BIOS boot partition (for GRUB on GPT)
+                    cmd!(sh, "sudo parted -s {loop_dev} mkpart primary 1MiB 2MiB").run()?;
+                    cmd!(sh, "sudo parted -s {loop_dev} set 1 bios_grub on").run()?;
+                    // Create EFI partition
+                    cmd!(
+                        sh,
+                        "sudo parted -s {loop_dev} mkpart primary fat32 2MiB 202MiB"
+                    )
+                    .run()?;
+                    cmd!(sh, "sudo parted -s {loop_dev} set 2 esp on").run()?;
+                    // Create boot partition
+                    cmd!(
+                        sh,
+                        "sudo parted -s {loop_dev} mkpart primary ext4 202MiB 1226MiB"
+                    )
+                    .run()?;
+                    // Create LVM partition
+                    cmd!(sh, "sudo parted -s {loop_dev} mkpart primary 1226MiB 100%").run()?;
+
+                    // Reload partition table
+                    cmd!(sh, "sudo partprobe {loop_dev}").run()?;
+                    std::thread::sleep(std::time::Duration::from_secs(2));
+
+                    let loop_part2 = format!("{}p2", loop_dev); // EFI
+                    let loop_part3 = format!("{}p3", loop_dev); // Boot
+                    let loop_part4 = format!("{}p4", loop_dev); // LVM
+
+                    // Create filesystems on boot partitions
+                    cmd!(sh, "sudo mkfs.vfat -F32 {loop_part2}").run()?;
+                    cmd!(sh, "sudo mkfs.ext4 -F {loop_part3}").run()?;
+
+                    // Setup LVM
+                    cmd!(sh, "sudo pvcreate {loop_part4}").run()?;
+                    cmd!(sh, "sudo vgcreate BL {loop_part4}").run()?;
+
+                    // Create logical volumes
+                    cmd!(sh, "sudo lvcreate -L 4G -n var02 BL").run()?;
+                    cmd!(sh, "sudo lvcreate -L 5G -n root02 BL").run()?;
+
+                    // Create filesystems on logical volumes
+                    cmd!(sh, "sudo mkfs.ext4 -F /dev/BL/var02").run()?;
+                    cmd!(sh, "sudo mkfs.ext4 -F /dev/BL/root02").run()?;
+
+                    // Get UUIDs
+                    let root_uuid = cmd!(sh, "sudo blkid -s UUID -o value /dev/BL/root02")
+                        .read()?
+                        .trim()
+                        .to_string();
+                    let boot_uuid = cmd!(sh, "sudo blkid -s UUID -o value {loop_part2}")
+                        .read()?
+                        .trim()
+                        .to_string();
+
+                    // Mount the partitions
+                    let target_dir = work_dir.join("target");
+                    std::fs::create_dir_all(&target_dir)?;
+                    let target = target_dir.to_str().unwrap();
+
+                    cmd!(sh, "sudo mount /dev/BL/root02 {target}").run()?;
+                    cmd!(sh, "sudo mkdir -p {target}/boot").run()?;
+                    cmd!(sh, "sudo mount {loop_part3} {target}/boot").run()?;
+                    cmd!(sh, "sudo mkdir -p {target}/boot/efi").run()?;
+                    cmd!(sh, "sudo mount {loop_part2} {target}/boot/efi").run()?;
+
+                    // Critical: Mount /var as a separate partition
+                    cmd!(sh, "sudo mkdir -p {target}/var").run()?;
+                    cmd!(sh, "sudo mount /dev/BL/var02 {target}/var").run()?;
+
+                    // Run bootc install to-filesystem
+                    // This should succeed and handle the separate /var mount correctly
+                    // Mount the target at /target inside the container for simplicity
+                    cmd!(
+                    sh,
+                    "sudo {BASE_ARGS...} -v {target}:/target -v /dev:/dev {image} bootc install to-filesystem --karg=root=UUID={root_uuid} --root-mount-spec=UUID={root_uuid} --boot-mount-spec=UUID={boot_uuid} /target"
+                )
+                .run()?;
+
+                    // Verify the installation succeeded
+                    // Check that bootc created the necessary files
+                    cmd!(sh, "sudo test -d {target}/ostree").run()?;
+                    cmd!(sh, "sudo test -d {target}/ostree/repo").run()?;
+                    // Verify bootloader was installed
+                    cmd!(sh, "sudo test -d {target}/boot/grub2").run()?;
+
+                    Ok(())
+                })() {
+                    let target = work_dir.join("target");
+                    let target_str = target.to_str().unwrap();
+                    cleanup(sh, &loop_dev, target_str);
+                    return Err(e.into());
+                }
+
+                // Clean up on success
+                let target = work_dir.join("target");
+                let target_str = target.to_str().unwrap();
+                cleanup(sh, &loop_dev, target_str);
+
+                Ok(())
+            },
+        ),
         Trial::test(
             "replace=alongside with ssh keys and a karg, and SELinux disabled",
             move || {