diff --git a/build/common.sh b/build/common.sh
index d4301bc23e6..8ca371c3332 100755
--- a/build/common.sh
+++ b/build/common.sh
@@ -953,24 +953,6 @@ function kube::release::package_kube_manifests_tarball() {
   mkdir -p "${dst_dir}/dns"
   tar c -C "${KUBE_ROOT}/cluster/saltbase/salt/kube-dns" ${objects} | tar x -C "${dst_dir}/dns"
 
-  # We leave the `{{ pillar['federations_domain_map'] }}` parameter as is, if
-  # the right federation environment variables isn't set. This is to allow
-  # users to provide these pillar values using the regular salt's mechanisms
-  # during cluster bootstrap.
-  if [[ "${FEDERATION:-}" == "true" ]]; then
-    FEDERATIONS_DOMAIN_MAP="${FEDERATIONS_DOMAIN_MAP:-}"
-    if [[ -z "${FEDERATIONS_DOMAIN_MAP}" && -n "${FEDERATION_NAME:-}" && -n "${DNS_ZONE_NAME:-}" ]]; then
-      FEDERATIONS_DOMAIN_MAP="${FEDERATION_NAME}=${DNS_ZONE_NAME}"
-    fi
-    if [[ -n "${FEDERATIONS_DOMAIN_MAP}" ]]; then
-      sed -i 's/{{ pillar\['"'"'federations_domain_map'"'"'\] }}/- --federations='"${FEDERATIONS_DOMAIN_MAP}"'/g' "${dst_dir}/dns/skydns-rc.yaml.in"
-    else
-      sed -i '/{{ pillar\['"'"'federations_domain_map'"'"'\] }}/d' "${dst_dir}/dns/skydns-rc.yaml.in"
-    fi
-  else
-    sed -i '/{{ pillar\['"'"'federations_domain_map'"'"'\] }}/d' "${dst_dir}/dns/skydns-rc.yaml.in"
-  fi
-
   # This is for coreos only. ContainerVM, GCI, or Trusty does not use it.
   cp -r "${KUBE_ROOT}/cluster/gce/coreos/kube-manifests"/* "${release_stage}/"
 
diff --git a/cluster/common.sh b/cluster/common.sh
index 5765228d0b2..f064da159c1 100755
--- a/cluster/common.sh
+++ b/cluster/common.sh
@@ -710,6 +710,28 @@ EOF
       cat >>$file <<EOF
 ENABLE_CLUSTER_AUTOSCALER: $(yaml-quote ${ENABLE_CLUSTER_AUTOSCALER})
 AUTOSCALER_MIG_CONFIG: $(yaml-quote ${AUTOSCALER_MIG_CONFIG})
+EOF
+  fi
+
+  # Federation specific environment variables.
+  if [[ -n "${FEDERATION:-}" ]]; then
+    cat >>$file <<EOF
+FEDERATION: $(yaml-quote ${FEDERATION})
+EOF
+  fi
+  if [ -n "${FEDERATIONS_DOMAIN_MAP:-}" ]; then
+    cat >>$file <<EOF
+FEDERATIONS_DOMAIN_MAP: $(yaml-quote ${FEDERATIONS_DOMAIN_MAP})
+EOF
+  fi
+  if [ -n "${FEDERATION_NAME:-}" ]; then
+    cat >>$file <<EOF
+FEDERATION_NAME: $(yaml-quote ${FEDERATION_NAME})
+EOF
+  fi
+  if [ -n "${DNS_ZONE_NAME:-}" ]; then
+    cat >>$file <<EOF
+DNS_ZONE_NAME: $(yaml-quote ${DNS_ZONE_NAME})
 EOF
   fi
 }
diff --git a/cluster/gce/configure-vm.sh b/cluster/gce/configure-vm.sh
index 255d7eab401..0409c43f521 100755
--- a/cluster/gce/configure-vm.sh
+++ b/cluster/gce/configure-vm.sh
@@ -551,7 +551,25 @@ enable_cluster_autoscaler: '$(echo "${ENABLE_CLUSTER_AUTOSCALER}" | sed -e "s/'/
 autoscaler_mig_config: '$(echo "${AUTOSCALER_MIG_CONFIG}" | sed -e "s/'/''/g")'
 EOF
     fi
-
+    if [[ "${FEDERATION:-}" == "true" ]]; then
+      FEDERATIONS_DOMAIN_MAP="${FEDERATIONS_DOMAIN_MAP:-}"
+      if [[ -z "${FEDERATIONS_DOMAIN_MAP}" && -n "${FEDERATION_NAME:-}" && -n "${DNS_ZONE_NAME:-}" ]]; then
+        FEDERATIONS_DOMAIN_MAP="${FEDERATION_NAME}=${DNS_ZONE_NAME}"
+      fi
+      if [[ -n "${FEDERATIONS_DOMAIN_MAP}" ]]; then
+        cat <<EOF >>/srv/salt-overlay/pillar/cluster-params.sls
+federations_domain_map: '$(echo "- --federations=${FEDERATIONS_DOMAIN_MAP}" | sed -e "s/'/''/g")'
+EOF
+      else
+        cat <<EOF >>/srv/salt-overlay/pillar/cluster-params.sls
+federations_domain_map: ''
+EOF
+      fi
+    else
+      cat <<EOF >>/srv/salt-overlay/pillar/cluster-params.sls
+federations_domain_map: ''
+EOF
+    fi
 }
 
 # The job of this function is simple, but the basic regular expression syntax makes
diff --git a/cluster/gce/gci/configure-helper.sh b/cluster/gce/gci/configure-helper.sh
index a4a26311bfa..23cde1db918 100644
--- a/cluster/gce/gci/configure-helper.sh
+++ b/cluster/gce/gci/configure-helper.sh
@@ -837,6 +837,20 @@ function start-kube-addons {
     sed -i -e "s@{{ *pillar\['dns_replicas'\] *}}@${DNS_REPLICAS}@g" "${dns_rc_file}"
     sed -i -e "s@{{ *pillar\['dns_domain'\] *}}@${DNS_DOMAIN}@g" "${dns_rc_file}"
     sed -i -e "s@{{ *pillar\['dns_server'\] *}}@${DNS_SERVER_IP}@g" "${dns_svc_file}"
+
+    if [[ "${FEDERATION:-}" == "true" ]]; then
+      FEDERATIONS_DOMAIN_MAP="${FEDERATIONS_DOMAIN_MAP:-}"
+      if [[ -z "${FEDERATIONS_DOMAIN_MAP}" && -n "${FEDERATION_NAME:-}" && -n "${DNS_ZONE_NAME:-}" ]]; then
+        FEDERATIONS_DOMAIN_MAP="${FEDERATION_NAME}=${DNS_ZONE_NAME}"
+      fi
+      if [[ -n "${FEDERATIONS_DOMAIN_MAP}" ]]; then
+        sed -i -e "s@{{ *pillar\['federations_domain_map'\] *}}@- --federations=${FEDERATIONS_DOMAIN_MAP}@g" "${dns_rc_file}"
+      else
+        sed -i -e "/{{ *pillar\['federations_domain_map'\] *}}/d" "${dns_rc_file}"
+      fi
+    else
+      sed -i -e "/{{ *pillar\['federations_domain_map'\] *}}/d" "${dns_rc_file}"
+    fi
   fi
   if [[ "${ENABLE_CLUSTER_REGISTRY:-}" == "true" ]]; then
     setup-addon-manifests "addons" "registry"
diff --git a/cluster/gce/trusty/configure-helper.sh b/cluster/gce/trusty/configure-helper.sh
index e43de66e756..e2fb5d3e2a9 100644
--- a/cluster/gce/trusty/configure-helper.sh
+++ b/cluster/gce/trusty/configure-helper.sh
@@ -767,6 +767,20 @@ start_kube_addons() {
     sed -i -e "s@{{ *pillar\['dns_replicas'\] *}}@${DNS_REPLICAS}@g" "${dns_rc_file}"
     sed -i -e "s@{{ *pillar\['dns_domain'\] *}}@${DNS_DOMAIN}@g" "${dns_rc_file}"
     sed -i -e "s@{{ *pillar\['dns_server'\] *}}@${DNS_SERVER_IP}@g" "${dns_svc_file}"
+
+    if [[ "${FEDERATION:-}" == "true" ]]; then
+      FEDERATIONS_DOMAIN_MAP="${FEDERATIONS_DOMAIN_MAP:-}"
+      if [[ -z "${FEDERATIONS_DOMAIN_MAP}" && -n "${FEDERATION_NAME:-}" && -n "${DNS_ZONE_NAME:-}" ]]; then
+        FEDERATIONS_DOMAIN_MAP="${FEDERATION_NAME}=${DNS_ZONE_NAME}"
+      fi
+      if [[ -n "${FEDERATIONS_DOMAIN_MAP}" ]]; then
+        sed -i -e "s@{{ *pillar\['federations_domain_map'\] *}}@- --federations=${FEDERATIONS_DOMAIN_MAP}@g" "${dns_rc_file}"
+      else
+        sed -i -e "/{{ *pillar\['federations_domain_map'\] *}}/d" "${dns_rc_file}"
+      fi
+    else
+      sed -i -e "/{{ *pillar\['federations_domain_map'\] *}}/d" "${dns_rc_file}"
+    fi
   fi
   if [ "${ENABLE_CLUSTER_REGISTRY:-}" = "true" ]; then
     setup_addon_manifests "addons" "registry"
diff --git a/cluster/mesos/docker/deploy-dns.sh b/cluster/mesos/docker/deploy-dns.sh
index f8f1734abd0..f9aff165387 100755
--- a/cluster/mesos/docker/deploy-dns.sh
+++ b/cluster/mesos/docker/deploy-dns.sh
@@ -31,6 +31,21 @@ workspace=$(pwd)
 sed -e "s/{{ pillar\['dns_replicas'\] }}/${DNS_REPLICAS}/g;s/{{ pillar\['dns_domain'\] }}/${DNS_DOMAIN}/g" "${KUBE_ROOT}/cluster/saltbase/salt/kube-dns/skydns-rc.yaml.in" > "${workspace}/skydns-rc.yaml"
 sed -e "s/{{ pillar\['dns_server'\] }}/${DNS_SERVER_IP}/g" "${KUBE_ROOT}/cluster/saltbase/salt/kube-dns/skydns-svc.yaml.in" > "${workspace}/skydns-svc.yaml"
 
+# Federation specific values.
+if [[ "${FEDERATION:-}" == "true" ]]; then
+  FEDERATIONS_DOMAIN_MAP="${FEDERATIONS_DOMAIN_MAP:-}"
+  if [[ -z "${FEDERATIONS_DOMAIN_MAP}" && -n "${FEDERATION_NAME:-}" && -n "${DNS_ZONE_NAME:-}" ]]; then
+    FEDERATIONS_DOMAIN_MAP="${FEDERATION_NAME}=${DNS_ZONE_NAME}"
+  fi
+  if [[ -n "${FEDERATIONS_DOMAIN_MAP}" ]]; then
+    sed -i -e "s/{{ pillar\['federations_domain_map'\] }}/- --federations=${FEDERATIONS_DOMAIN_MAP}/g" "${workspace}/skydns-rc.yaml"
+  else
+    sed -i -e "/{{ pillar\['federations_domain_map'\] }}/d" "${workspace}/skydns-rc.yaml"
+  fi
+else
+  sed -i -e "/{{ pillar\['federations_domain_map'\] }}/d" "${workspace}/skydns-rc.yaml"
+fi
+
 # Use kubectl to create skydns rc and service
 "${kubectl}" create -f "${workspace}/skydns-rc.yaml"
 "${kubectl}" create -f "${workspace}/skydns-svc.yaml"
diff --git a/cluster/openstack-heat/kubernetes-heat/fragments/configure-salt.yaml b/cluster/openstack-heat/kubernetes-heat/fragments/configure-salt.yaml
index c996d39482c..bed41547c4c 100644
--- a/cluster/openstack-heat/kubernetes-heat/fragments/configure-salt.yaml
+++ b/cluster/openstack-heat/kubernetes-heat/fragments/configure-salt.yaml
@@ -46,6 +46,7 @@ write_files:
       dns_replicas: "1"
       dns_server: 10.246.0.10
       dns_domain: cluster.local
+      federations_domain_map: ''
       instance_prefix: kubernetes
       admission_control: NamespaceLifecycle,LimitRanger,SecurityContextDeny,ServiceAccount,ResourceQuota
       enable_cpu_cfs_quota: "true"
diff --git a/cluster/photon-controller/templates/create-dynamic-salt-files.sh b/cluster/photon-controller/templates/create-dynamic-salt-files.sh
index 424c75bd4ff..4a7c3be7017 100755
--- a/cluster/photon-controller/templates/create-dynamic-salt-files.sh
+++ b/cluster/photon-controller/templates/create-dynamic-salt-files.sh
@@ -120,6 +120,7 @@ enable_cluster_dns: "${ENABLE_CLUSTER_DNS:-false}"
 dns_replicas: ${DNS_REPLICAS:-1}
 dns_server: $DNS_SERVER_IP
 dns_domain: $DNS_DOMAIN
+federations_domain_map: ''
 e2e_storage_test_environment: "${E2E_STORAGE_TEST_ENVIRONMENT:-false}"
 cluster_cidr: "$NODE_IP_RANGES"
 allocate_node_cidrs: "${ALLOCATE_NODE_CIDRS:-true}"
diff --git a/cluster/vagrant/provision-utils.sh b/cluster/vagrant/provision-utils.sh
index 846d9c505ce..e486af93264 100755
--- a/cluster/vagrant/provision-utils.sh
+++ b/cluster/vagrant/provision-utils.sh
@@ -59,6 +59,7 @@ enable_cluster_dns: '$(echo "$ENABLE_CLUSTER_DNS" | sed -e "s/'/''/g")'
 dns_replicas: '$(echo "$DNS_REPLICAS" | sed -e "s/'/''/g")'
 dns_server: '$(echo "$DNS_SERVER_IP" | sed -e "s/'/''/g")'
 dns_domain: '$(echo "$DNS_DOMAIN" | sed -e "s/'/''/g")'
+federations_domain_map: ''
 instance_prefix: '$(echo "$INSTANCE_PREFIX" | sed -e "s/'/''/g")'
 admission_control: '$(echo "$ADMISSION_CONTROL" | sed -e "s/'/''/g")'
 enable_cpu_cfs_quota: '$(echo "$ENABLE_CPU_CFS_QUOTA" | sed -e "s/'/''/g")'
diff --git a/cluster/vsphere/templates/create-dynamic-salt-files.sh b/cluster/vsphere/templates/create-dynamic-salt-files.sh
index e85aaacf7d5..0d2e9252a68 100755
--- a/cluster/vsphere/templates/create-dynamic-salt-files.sh
+++ b/cluster/vsphere/templates/create-dynamic-salt-files.sh
@@ -120,6 +120,7 @@ enable_cluster_dns: "${ENABLE_CLUSTER_DNS:-false}"
 dns_replicas: ${DNS_REPLICAS:-1}
 dns_server: $DNS_SERVER_IP
 dns_domain: $DNS_DOMAIN
+federations_domain_map: ''
 e2e_storage_test_environment: "${E2E_STORAGE_TEST_ENVIRONMENT:-false}"
 cluster_cidr: "$NODE_IP_RANGES"
 allocate_node_cidrs: "${ALLOCATE_NODE_CIDRS:-true}"
diff --git a/hack/local-up-cluster.sh b/hack/local-up-cluster.sh
index 9713243b85e..6a7e1e64586 100755
--- a/hack/local-up-cluster.sh
+++ b/hack/local-up-cluster.sh
@@ -412,6 +412,19 @@ function start_kubedns {
     if [[ "${ENABLE_CLUSTER_DNS}" = true ]]; then
         echo "Creating kube-system namespace"
         sed -e "s/{{ pillar\['dns_replicas'\] }}/${DNS_REPLICAS}/g;s/{{ pillar\['dns_domain'\] }}/${DNS_DOMAIN}/g;" "${KUBE_ROOT}/cluster/saltbase/salt/kube-dns/skydns-rc.yaml.in" >| skydns-rc.yaml
+        if [[ "${FEDERATION:-}" == "true" ]]; then
+          FEDERATIONS_DOMAIN_MAP="${FEDERATIONS_DOMAIN_MAP:-}"
+          if [[ -z "${FEDERATIONS_DOMAIN_MAP}" && -n "${FEDERATION_NAME:-}" && -n "${DNS_ZONE_NAME:-}" ]]; then
+            FEDERATIONS_DOMAIN_MAP="${FEDERATION_NAME}=${DNS_ZONE_NAME}"
+          fi
+          if [[ -n "${FEDERATIONS_DOMAIN_MAP}" ]]; then
+            sed -i -e "s/{{ pillar\['federations_domain_map'\] }}/- --federations=${FEDERATIONS_DOMAIN_MAP}/g" skydns-rc.yaml
+          else
+            sed -i -e "/{{ pillar\['federations_domain_map'\] }}/d" skydns-rc.yaml
+          fi
+        else
+          sed -i -e "/{{ pillar\['federations_domain_map'\] }}/d" skydns-rc.yaml
+        fi
         sed -e "s/{{ pillar\['dns_server'\] }}/${DNS_SERVER_IP}/g" "${KUBE_ROOT}/cluster/saltbase/salt/kube-dns/skydns-svc.yaml.in" >| skydns-svc.yaml
         cat <<EOF >namespace.yaml
 apiVersion: v1