diff --git a/dracut/30ignition/ignition-setup-base.service b/dracut/30ignition/ignition-setup-base.service
deleted file mode 100644
index aec6207bb8..0000000000
--- a/dracut/30ignition/ignition-setup-base.service
+++ /dev/null
@@ -1,18 +0,0 @@
-[Unit]
-Description=Ignition (setup base config)
-Documentation=https://github.com/coreos/ignition
-ConditionPathExists=/etc/initrd-release
-DefaultDependencies=false
-Before=ignition-complete.target
-
-OnFailure=emergency.target
-OnFailureJobMode=isolate
-
-# Stage order: setup -> fetch-offline [-> fetch] -> disks -> mount -> files.
-Before=ignition-fetch-offline.service
-
-[Service]
-Type=oneshot
-RemainAfterExit=yes
-EnvironmentFile=/run/ignition.env
-ExecStart=/usr/sbin/ignition-setup-base
diff --git a/dracut/30ignition/ignition-setup-base.sh b/dracut/30ignition/ignition-setup-base.sh
deleted file mode 100755
index bc7c189504..0000000000
--- a/dracut/30ignition/ignition-setup-base.sh
+++ /dev/null
@@ -1,19 +0,0 @@
-#!/bin/bash
-set -euo pipefail
-
-copy_file_if_exists() {
-    src="${1}"; dst="${2}"
-    if [ -f "${src}" ]; then
-        echo "Copying ${src} to ${dst}"
-        cp "${src}" "${dst}"
-    else
-        echo "File ${src} does not exist.. Skipping copy"
-    fi
-}
-
-destination=/usr/lib/ignition
-mkdir -p $destination
-
-# We will support grabbing a platform specific base.ign config
-# from the initrd at /usr/lib/ignition/platform/${PLATFORM_ID}/base.ign
-copy_file_if_exists "/usr/lib/ignition/platform/${PLATFORM_ID}/base.ign" "${destination}/base.ign"
diff --git a/dracut/30ignition/module-setup.sh b/dracut/30ignition/module-setup.sh
index d8c9d514bf..73c23054fe 100755
--- a/dracut/30ignition/module-setup.sh
+++ b/dracut/30ignition/module-setup.sh
@@ -56,8 +56,6 @@ install() {
     # Required on system using SELinux
     inst_multiple -o setfiles
 
-    inst_script "$moddir/ignition-setup-base.sh" \
-        "/usr/sbin/ignition-setup-base"
     inst_script "$moddir/ignition-setup-user.sh" \
         "/usr/sbin/ignition-setup-user"
 
@@ -82,7 +80,6 @@ install() {
             "$systemdsystemunitdir/ignition-$x.target"
     done
 
-    install_ignition_unit ignition-setup-base.service
     install_ignition_unit ignition-setup-user.service
     install_ignition_unit ignition-fetch.service
     install_ignition_unit ignition-fetch-offline.service
diff --git a/internal/providers/system/system.go b/internal/providers/system/system.go
index ec9f831ec4..6c5605e821 100644
--- a/internal/providers/system/system.go
+++ b/internal/providers/system/system.go
@@ -15,10 +15,13 @@
 package system
 
 import (
+	"fmt"
 	"io/ioutil"
 	"os"
 	"path/filepath"
+	"strings"
 
+	latest "github.com/coreos/ignition/v2/config/v3_3_experimental"
 	"github.com/coreos/ignition/v2/config/v3_3_experimental/types"
 	"github.com/coreos/ignition/v2/internal/distro"
 	"github.com/coreos/ignition/v2/internal/log"
@@ -35,7 +38,35 @@ const (
 )
 
 func FetchBaseConfig(logger *log.Logger) (types.Config, report.Report, error) {
-	return fetchConfig(logger, baseFilename)
+	var fullBaseConfig types.Config
+	baseConfig, _, err := fetchConfig(logger, baseFilename)
+	if err != nil {
+		logger.Err("couldn't fetch base config: %v", err)
+		return types.Config{}, report.Report{}, err
+	}
+	fullBaseConfig = latest.Merge(fullBaseConfig, baseConfig)
+
+	// For merging base.d config fragments
+	baseDConfig, _, err := fetchBaseConfig(logger, "base.d", fullBaseConfig)
+	if err != nil {
+		return types.Config{}, report.Report{}, err
+	}
+
+	contents, _ := ioutil.ReadDir(distro.SystemConfigDir())
+	for _, content := range contents {
+		if content.IsDir() {
+			// To check if a `base.$PLATFORM_ID.d` directory exists and
+			// accordingly proceed with the config merging operation.
+			if strings.Contains(content.Name(), "base") && len(strings.Split(content.Name(), ".")) == 3 && content.Size() > 0 {
+				basePlatformDConfig, _, err := fetchBaseConfig(logger, content.Name(), fullBaseConfig)
+				if err != nil {
+					return types.Config{}, report.Report{}, err
+				}
+				baseDConfig = latest.Merge(baseDConfig, basePlatformDConfig)
+			}
+		}
+	}
+	return baseDConfig, report.Report{}, nil
 }
 
 func FetchConfig(f *resource.Fetcher) (types.Config, report.Report, error) {
@@ -56,3 +87,29 @@ func fetchConfig(logger *log.Logger, filename string) (types.Config, report.Repo
 	}
 	return util.ParseConfig(logger, rawConfig)
 }
+
+// fetchBaseConfig is a helper function to merge all the base config fragments inside of a particular directory.
+func fetchBaseConfig(logger *log.Logger, dir string, fullBaseConfig types.Config) (types.Config, report.Report, error) {
+	path := filepath.Join(distro.SystemConfigDir(), dir)
+	configs, err := ioutil.ReadDir(path)
+	if os.IsNotExist(err) {
+		logger.Info("no config dir at %q", path)
+		return types.Config{}, report.Report{}, err
+	} else if err != nil {
+		logger.Err("couldn't read config dir %q: %v", path, err)
+		return types.Config{}, report.Report{}, err
+	}
+	if len(configs) == 0 {
+		logger.Info("no configs at %q", path)
+		return types.Config{}, report.Report{}, nil
+	}
+	for _, config := range configs {
+		file := fmt.Sprintf("%s/%s", path, config.Name())
+		baseConfig, _, err := fetchConfig(logger, file)
+		if err != nil {
+			return types.Config{}, report.Report{}, err
+		}
+		fullBaseConfig = latest.Merge(fullBaseConfig, baseConfig)
+	}
+	return fullBaseConfig, report.Report{}, nil
+}