diff --git a/build_sysext b/build_sysext
index cd059ee3add..32712877658 100755
--- a/build_sysext
+++ b/build_sysext
@@ -275,6 +275,10 @@ all_fields=(
   "ARCHITECTURE=${ARCH}"
 )
 printf '%s\n' "${all_fields[@]}" >"${BUILD_DIR}/install-root/usr/lib/extension-release.d/extension-release.${SYSEXTNAME}"
+
+info "Removing opaque directory markers to always merge all contents"
+find "${BUILD_DIR}/install-root" -xdev -type d -exec sh -c 'if [ "$(attr -R -q -g overlay.opaque {} 2>/dev/null)" = y ]; then attr -R -r overlay.opaque {}; fi' \;
+
 mksquashfs "${BUILD_DIR}/install-root" "${BUILD_DIR}/${SYSEXTNAME}.raw" \
                -noappend -comp "${FLAGS_compression}" ${FLAGS_mksquashfs_opts}
 rm -rf "${BUILD_DIR}"/{fs-root,install-root,workdir}
diff --git a/changelog/bugfixes/2024-03-05-ensure-sysext-contents-merge.md b/changelog/bugfixes/2024-03-05-ensure-sysext-contents-merge.md
new file mode 100644
index 00000000000..67fcd1caa61
--- /dev/null
+++ b/changelog/bugfixes/2024-03-05-ensure-sysext-contents-merge.md
@@ -0,0 +1 @@
+- Fixed that systemd-sysext images can extend directories where Flatcar extensions are also shipping files, e.g., that the sysext-bakery Kubernetes extension works when OEM extensions are present ([sysext-bakery#50](https://github.com/flatcar/sysext-bakery/issues/50))