diff --git a/cluster/gce/config-default.sh b/cluster/gce/config-default.sh
index 331583b6b64..92ef70f43d8 100755
--- a/cluster/gce/config-default.sh
+++ b/cluster/gce/config-default.sh
@@ -106,6 +106,13 @@ ENABLE_L7_LOADBALANCING="${KUBE_ENABLE_L7_LOADBALANCING:-glbc}"
 #   standalone     - Heapster only. Metrics available via Heapster REST API.
 ENABLE_CLUSTER_MONITORING="${KUBE_ENABLE_CLUSTER_MONITORING:-influxdb}"
 
+# Historically fluentd was a manifest pod and then was migrated to DaemonSet.
+# To avoid situation during cluster upgrade when there are two instances
+# of fluentd running on a node, kubelet need to mark node on which
+# fluentd is not running as a manifest pod with appropriate label.
+# TODO(piosz): remove this in 1.8
+NODE_LABELS="${KUBE_NODE_LABELS:-alpha.kubernetes.io/fluentd-ds-ready=true}"
+
 # Optional: Enable node logging.
 ENABLE_NODE_LOGGING="${KUBE_ENABLE_NODE_LOGGING:-true}"
 LOGGING_DESTINATION="${KUBE_LOGGING_DESTINATION:-gcp}" # options: elasticsearch, gcp
diff --git a/cluster/gce/config-test.sh b/cluster/gce/config-test.sh
index c4a02b2c46c..814f58fa044 100755
--- a/cluster/gce/config-test.sh
+++ b/cluster/gce/config-test.sh
@@ -137,6 +137,13 @@ CONTROLLER_MANAGER_TEST_ARGS="${CONTROLLER_MANAGER_TEST_ARGS:-} ${TEST_CLUSTER_R
 SCHEDULER_TEST_ARGS="${SCHEDULER_TEST_ARGS:-} ${TEST_CLUSTER_API_CONTENT_TYPE}"
 KUBEPROXY_TEST_ARGS="${KUBEPROXY_TEST_ARGS:-} ${TEST_CLUSTER_API_CONTENT_TYPE}"
 
+# Historically fluentd was a manifest pod and then was migrated to DaemonSet.
+# To avoid situation during cluster upgrade when there are two instances
+# of fluentd running on a node, kubelet need to mark node on which
+# fluentd is not running as a manifest pod with appropriate label.
+# TODO(piosz): remove this in 1.8
+NODE_LABELS="${KUBE_NODE_LABELS:-alpha.kubernetes.io/fluentd-ds-ready=true}"
+
 # Optional: Enable node logging.
 ENABLE_NODE_LOGGING="${KUBE_ENABLE_NODE_LOGGING:-true}"
 LOGGING_DESTINATION="${KUBE_LOGGING_DESTINATION:-gcp}" # options: elasticsearch, gcp
diff --git a/pkg/kubelet/kubelet_node_status.go b/pkg/kubelet/kubelet_node_status.go
index e07596f6e59..a0da169f6b0 100644
--- a/pkg/kubelet/kubelet_node_status.go
+++ b/pkg/kubelet/kubelet_node_status.go
@@ -192,10 +192,9 @@ func (kl *Kubelet) initialNode() (*v1.Node, error) {
 		ObjectMeta: metav1.ObjectMeta{
 			Name: string(kl.nodeName),
 			Labels: map[string]string{
-				metav1.LabelHostname:       kl.hostname,
-				metav1.LabelOS:             goruntime.GOOS,
-				metav1.LabelArch:           goruntime.GOARCH,
-				metav1.LabelFluentdDsReady: "true",
+				metav1.LabelHostname: kl.hostname,
+				metav1.LabelOS:       goruntime.GOOS,
+				metav1.LabelArch:     goruntime.GOARCH,
 			},
 		},
 		Spec: v1.NodeSpec{