diff --git a/CHANGELOG.next.asciidoc b/CHANGELOG.next.asciidoc
index 41643bc8f7b..ec49824e1ad 100644
--- a/CHANGELOG.next.asciidoc
+++ b/CHANGELOG.next.asciidoc
@@ -304,6 +304,7 @@ https://github.com/elastic/beats/compare/v7.0.0-alpha2...master[Check the HEAD d
 - Update config in `windows.yml` file. {issue}23027[23027]{pull}23327[23327]
 - Add stack monitoring section to elasticsearch module documentation {pull}#23286[23286]
 - Fix metric grouping for windows/perfmon module {issue}23489[23489] {pull}23505[23505]
+- Add system.hostfs configuration option for system module. {pull}23831[23831]
 
 *Packetbeat*
 
diff --git a/metricbeat/docs/modules/system.asciidoc b/metricbeat/docs/modules/system.asciidoc
index bdfe4bbe84c..315cae1201b 100644
--- a/metricbeat/docs/modules/system.asciidoc
+++ b/metricbeat/docs/modules/system.asciidoc
@@ -178,6 +178,9 @@ metricbeat.modules:
   period: 10s
   processes: ['.*']
 
+  # Configure the mount point of the host’s filesystem for use in monitoring a host from within a container
+  #system.hostfs: "/hostfs"
+
   # Configure the metric types that are included by these metricsets.
   cpu.metrics:  ["percentages","normalized_percentages"]  # The other available option is ticks.
   core.metrics: ["percentages"]  # The other available option is ticks.
diff --git a/metricbeat/metricbeat.reference.yml b/metricbeat/metricbeat.reference.yml
index 23e8f23c909..e2ec23cfa74 100644
--- a/metricbeat/metricbeat.reference.yml
+++ b/metricbeat/metricbeat.reference.yml
@@ -79,6 +79,9 @@ metricbeat.modules:
   period: 10s
   processes: ['.*']
 
+  # Configure the mount point of the host’s filesystem for use in monitoring a host from within a container
+  #system.hostfs: "/hostfs"
+
   # Configure the metric types that are included by these metricsets.
   cpu.metrics:  ["percentages","normalized_percentages"]  # The other available option is ticks.
   core.metrics: ["percentages"]  # The other available option is ticks.
diff --git a/metricbeat/module/system/_meta/config.reference.yml b/metricbeat/module/system/_meta/config.reference.yml
index 39438686dbd..929f585e7d9 100644
--- a/metricbeat/module/system/_meta/config.reference.yml
+++ b/metricbeat/module/system/_meta/config.reference.yml
@@ -19,6 +19,9 @@
   period: 10s
   processes: ['.*']
 
+  # Configure the mount point of the host’s filesystem for use in monitoring a host from within a container
+  #system.hostfs: "/hostfs"
+
   # Configure the metric types that are included by these metricsets.
   cpu.metrics:  ["percentages","normalized_percentages"]  # The other available option is ticks.
   core.metrics: ["percentages"]  # The other available option is ticks.
diff --git a/metricbeat/module/system/_meta/config.yml b/metricbeat/module/system/_meta/config.yml
index 6fe06489217..3f22bc5a496 100644
--- a/metricbeat/module/system/_meta/config.yml
+++ b/metricbeat/module/system/_meta/config.yml
@@ -17,6 +17,8 @@
   process.include_top_n:
     by_cpu: 5      # include top 5 processes by CPU
     by_memory: 5   # include top 5 processes by memory
+  # Configure the mount point of the host’s filesystem for use in monitoring a host from within a container
+  #system.hostfs: "/hostfs"
 
 - module: system
   period: 1m
diff --git a/metricbeat/module/system/system.go b/metricbeat/module/system/system.go
index 0efba5c0f16..a6af865ca49 100644
--- a/metricbeat/module/system/system.go
+++ b/metricbeat/module/system/system.go
@@ -22,10 +22,12 @@ import (
 	"sync"
 
 	"github.com/elastic/beats/v7/libbeat/common/fleetmode"
+	"github.com/elastic/beats/v7/libbeat/logp"
 	"github.com/elastic/beats/v7/metricbeat/mb"
 )
 
 var (
+	// TODO: remove this flag in 8.0 since it should be replaced by system.hostfs configuration option (config.HostFS)
 	// HostFS is an alternate mountpoint for the filesytem root, for when metricbeat is running inside a container.
 	HostFS = flag.String("system.hostfs", "", "mountpoint of the host's filesystem for use in monitoring a host from within a container")
 )
@@ -39,6 +41,11 @@ func init() {
 	}
 }
 
+// Config for the system module.
+type Config struct {
+	HostFS string `config:"system.hostfs"` // Specifies the mount point of the host’s filesystem for use in monitoring a host from within a container.
+}
+
 // Module represents the system module
 type Module struct {
 	mb.BaseModule
@@ -48,10 +55,25 @@ type Module struct {
 
 // NewModule instatiates the system module
 func NewModule(base mb.BaseModule) (mb.Module, error) {
+
+	config := Config{
+		HostFS: "",
+	}
+	err := base.UnpackConfig(&config)
+	if err != nil {
+		return nil, err
+	}
+	if *HostFS != "" {
+		if config.HostFS != "" {
+			logp.Warn("-system.hostfs flag is set and will override configuration setting")
+		}
+		config.HostFS = *HostFS
+	}
+
 	// This only needs to be configured once for all system modules.
 	once.Do(func() {
-		initModule()
+		initModule(config)
 	})
 
-	return &Module{BaseModule: base, HostFS: *HostFS, IsAgent: fleetmode.Enabled()}, nil
+	return &Module{BaseModule: base, HostFS: config.HostFS, IsAgent: fleetmode.Enabled()}, nil
 }
diff --git a/metricbeat/module/system/system_linux.go b/metricbeat/module/system/system_linux.go
index 72477566a93..6f3f15a1135 100644
--- a/metricbeat/module/system/system_linux.go
+++ b/metricbeat/module/system/system_linux.go
@@ -24,12 +24,12 @@ import (
 	"github.com/elastic/gosigar"
 )
 
-func initModule() {
-	configureHostFS()
+func initModule(config Config) {
+	configureHostFS(config)
 }
 
-func configureHostFS() {
-	dir := *HostFS
+func configureHostFS(config Config) {
+	dir := config.HostFS
 	if dir == "" {
 		dir = "/"
 	}
diff --git a/metricbeat/module/system/system_other.go b/metricbeat/module/system/system_other.go
index 8d89efbd485..c526d363b28 100644
--- a/metricbeat/module/system/system_other.go
+++ b/metricbeat/module/system/system_other.go
@@ -19,6 +19,6 @@
 
 package system
 
-func initModule() {
+func initModule(config Config) {
 	// Stub method for non-linux.
 }
diff --git a/metricbeat/module/system/system_windows.go b/metricbeat/module/system/system_windows.go
index 154481eb657..1c95b3e92f9 100644
--- a/metricbeat/module/system/system_windows.go
+++ b/metricbeat/module/system/system_windows.go
@@ -22,7 +22,7 @@ import (
 	"github.com/elastic/beats/v7/metricbeat/helper"
 )
 
-func initModule() {
+func initModule(config Config) {
 	if err := helper.CheckAndEnableSeDebugPrivilege(); err != nil {
 		logp.Warn("%v", err)
 	}
diff --git a/metricbeat/modules.d/system.yml b/metricbeat/modules.d/system.yml
index 57fca1b0345..339d66abc3a 100644
--- a/metricbeat/modules.d/system.yml
+++ b/metricbeat/modules.d/system.yml
@@ -20,6 +20,8 @@
   process.include_top_n:
     by_cpu: 5      # include top 5 processes by CPU
     by_memory: 5   # include top 5 processes by memory
+  # Configure the mount point of the host’s filesystem for use in monitoring a host from within a container
+  #system.hostfs: "/hostfs"
 
 - module: system
   period: 1m
diff --git a/x-pack/metricbeat/metricbeat.reference.yml b/x-pack/metricbeat/metricbeat.reference.yml
index 8717b9df2b4..58c6e9df7a5 100644
--- a/x-pack/metricbeat/metricbeat.reference.yml
+++ b/x-pack/metricbeat/metricbeat.reference.yml
@@ -79,6 +79,9 @@ metricbeat.modules:
   period: 10s
   processes: ['.*']
 
+  # Configure the mount point of the host’s filesystem for use in monitoring a host from within a container
+  #system.hostfs: "/hostfs"
+
   # Configure the metric types that are included by these metricsets.
   cpu.metrics:  ["percentages","normalized_percentages"]  # The other available option is ticks.
   core.metrics: ["percentages"]  # The other available option is ticks.