diff --git a/tests/README.md b/tests/README.md
index a0e429ea05..bb82e3f94f 100644
--- a/tests/README.md
+++ b/tests/README.md
@@ -7,10 +7,10 @@ osbuilder provides a test script that creates all images and initrds for all
 supported distributions and then tests them to ensure a Kata Container can
 be created with each.
 
-The test script installs all required Kata components on the host system
-before creating the images.
-
-To run all available osbuilder tests:
+Before the build phase, the test script installs the Docker container manager
+and all the Kata components required to run test containers. This step can be
+skipped by setting the environment variable `KATA_DEV_MODE` to a non-empty
+value.
 
 ```
 $ ./test_images.sh
diff --git a/tests/test_images.sh b/tests/test_images.sh
index fce4348b2f..b30b4e6891 100755
--- a/tests/test_images.sh
+++ b/tests/test_images.sh
@@ -235,7 +235,17 @@ setup()
 
 	[ ! -d "${tests_repo_dir}" ] && git clone "https://${tests_repo}" "${tests_repo_dir}"
 
-	chronic $mgr install-docker-system
+	if [ -z "${KATA_DEV_MODE:-}" ]; then
+		chronic $mgr install-docker-system
+	else
+		info "Running with KATA_DEV_MODE set, skipping installation of docker and kata packages"
+		# Make sure docker & kata are available
+		command -v docker >/dev/null || die "docker cannot be found on your PATH"
+		local cfgRuntime=
+		cfgRuntime="$(docker info --format "{{(index .Runtimes \"${RUNTIME}\").Path}}")"
+		[ -n "$cfgRuntime" ] || die "${RUNTIME} is not a configured runtime for docker"
+		[ -x "$cfgRuntime" ] || die "docker ${RUNTIME} is linked to an invalid executable: $cfgRuntime"
+	fi
 	chronic $mgr enable-debug
 
 	# Ensure "docker build" works