diff --git a/cmd/kube-apiserver/app/server.go b/cmd/kube-apiserver/app/server.go
index 8c0cce89b3e..8e4390e2f25 100644
--- a/cmd/kube-apiserver/app/server.go
+++ b/cmd/kube-apiserver/app/server.go
@@ -145,6 +145,28 @@ func Run(s *options.APIServer) error {
 		glog.Fatalf("Failed to start kubelet client: %v", err)
 	}
 
+	if s.StorageConfig.DeserializationCacheSize == 0 {
+		// When size of cache is not explicitly set, estimate its size based on
+		// target memory usage.
+		glog.V(2).Infof("Initalizing deserialization cache size based on %dMB limit", s.TargetRAMMB)
+
+		// This is the heuristics that from memory capacity is trying to infer
+		// the maximum number of nodes in the cluster and set cache sizes based
+		// on that value.
+		// From our documentation, we officially recomment 120GB machines for
+		// 2000 nodes, and we scale from that point. Thus we assume ~60MB of
+		// capacity per node.
+		// TODO: We may consider deciding that some percentage of memory will
+		// be used for the deserialization cache and divide it by the max object
+		// size to compute its size. We may even go further and measure
+		// collective sizes of the objects in the cache.
+		clusterSize := s.TargetRAMMB / 60
+		s.StorageConfig.DeserializationCacheSize = 25 * clusterSize
+		if s.StorageConfig.DeserializationCacheSize < 1000 {
+			s.StorageConfig.DeserializationCacheSize = 1000
+		}
+	}
+
 	storageGroupsToEncodingVersion, err := s.StorageGroupsToEncodingVersion()
 	if err != nil {
 		glog.Fatalf("error generating storage version map: %s", err)
diff --git a/federation/cmd/federation-apiserver/app/server.go b/federation/cmd/federation-apiserver/app/server.go
index 01001285787..034555b95d7 100644
--- a/federation/cmd/federation-apiserver/app/server.go
+++ b/federation/cmd/federation-apiserver/app/server.go
@@ -82,6 +82,10 @@ func Run(s *options.ServerRunOptions) error {
 	// TODO: register cluster federation resources here.
 	resourceConfig := genericapiserver.NewResourceConfig()
 
+	if s.StorageConfig.DeserializationCacheSize == 0 {
+		// When size of cache is not explicitly set, set it to 50000
+		s.StorageConfig.DeserializationCacheSize = 50000
+	}
 	storageGroupsToEncodingVersion, err := s.StorageGroupsToEncodingVersion()
 	if err != nil {
 		glog.Fatalf("error generating storage version map: %s", err)
diff --git a/pkg/genericapiserver/options/server_run_options.go b/pkg/genericapiserver/options/server_run_options.go
index 40289b11fd6..ec1c66f0a2b 100644
--- a/pkg/genericapiserver/options/server_run_options.go
+++ b/pkg/genericapiserver/options/server_run_options.go
@@ -37,8 +37,6 @@ import (
 )
 
 const (
-	DefaultDeserializationCacheSize = 50000
-
 	// TODO: This can be tightened up. It still matches objects named watch or proxy.
 	defaultLongRunningRequestRE = "(/|^)((watch|proxy)(/|$)|(logs?|portforward|exec|attach)/?$)"
 )
@@ -158,7 +156,9 @@ func NewServerRunOptions() *ServerRunOptions {
 func (o *ServerRunOptions) WithEtcdOptions() *ServerRunOptions {
 	o.StorageConfig = storagebackend.Config{
 		Prefix: DefaultEtcdPathPrefix,
-		DeserializationCacheSize: DefaultDeserializationCacheSize,
+		// Default cache size to 0 - if unset, its size will be set based on target
+		// memory usage.
+		DeserializationCacheSize: 0,
 	}
 	return o
 }