diff --git a/docs/formatstorage.rst b/docs/formatstorage.rst
index d7ca58788a..ef15c0ac5c 100644
--- a/docs/formatstorage.rst
+++ b/docs/formatstorage.rst
@@ -652,6 +652,7 @@ host filesystem. It can contain the following child elements:
      <clusterSize unit='KiB'>64</clusterSize>
      <features>
        <lazy_refcounts/>
+       <extended_l2/>
      </features>
    </target>
 
@@ -714,6 +715,9 @@ host filesystem. It can contain the following child elements:
 
    -  ``<lazy_refcounts/>`` - allow delayed reference counter updates.
       :since:`Since 1.1.0`
+   - ``<extended_l2/>`` - enables subcluster allocation for qcow2 images. QCOW2
+     clusters are split into 32 subclusters decreasing the size of L2 cache
+     needed. It's recommended to increase ``clusterSize``.
 
 Backing store elements
 ~~~~~~~~~~~~~~~~~~~~~~
diff --git a/docs/schemas/storagecommon.rng b/docs/schemas/storagecommon.rng
index 591a158209..10f1bc6a15 100644
--- a/docs/schemas/storagecommon.rng
+++ b/docs/schemas/storagecommon.rng
@@ -134,6 +134,11 @@
             <empty/>
           </element>
         </optional>
+        <optional>
+          <element name="extended_l2">
+            <empty/>
+          </element>
+        </optional>
       </interleave>
     </element>
   </define>
diff --git a/src/conf/storage_source_conf.c b/src/conf/storage_source_conf.c
index c0acee189a..d42f715f26 100644
--- a/src/conf/storage_source_conf.c
+++ b/src/conf/storage_source_conf.c
@@ -66,6 +66,7 @@ VIR_ENUM_IMPL(virStorageFileFormat,
 VIR_ENUM_IMPL(virStorageFileFeature,
               VIR_STORAGE_FILE_FEATURE_LAST,
               "lazy_refcounts",
+              "extended_l2",
 );
 
 
diff --git a/src/conf/storage_source_conf.h b/src/conf/storage_source_conf.h
index 40db29c418..c4a026881c 100644
--- a/src/conf/storage_source_conf.h
+++ b/src/conf/storage_source_conf.h
@@ -86,6 +86,7 @@ VIR_ENUM_DECL(virStorageFileFormat);
 
 typedef enum {
     VIR_STORAGE_FILE_FEATURE_LAZY_REFCOUNTS = 0,
+    VIR_STORAGE_FILE_FEATURE_EXTENDED_L2,
 
     VIR_STORAGE_FILE_FEATURE_LAST
 } virStorageFileFeature;
diff --git a/src/storage/storage_util.c b/src/storage/storage_util.c
index bfc3edb1fd..03874d6ca3 100644
--- a/src/storage/storage_util.c
+++ b/src/storage/storage_util.c
@@ -796,6 +796,17 @@ storageBackendCreateQemuImgOpts(virStorageEncryptionInfoDef *encinfo,
             }
             virBufferAddLit(&buf, "lazy_refcounts,");
         }
+
+        if (virBitmapIsBitSet(info->features,
+                              VIR_STORAGE_FILE_FEATURE_EXTENDED_L2)) {
+            if (STREQ_NULLABLE(info->compat, "0.10")) {
+                virReportError(VIR_ERR_CONFIG_UNSUPPORTED,
+                               _("'extended_l2' not supported with compat level %s"),
+                               info->compat);
+                return -1;
+            }
+            virBufferAddLit(&buf, "extended_l2=on,");
+        }
     }
 
     virBufferTrim(&buf, ",");
diff --git a/tests/storagevolxml2argvdata/qcow2-clusterSize.argv b/tests/storagevolxml2argvdata/qcow2-clusterSize.argv
index 8878a26818..c84fc8c47a 100644
--- a/tests/storagevolxml2argvdata/qcow2-clusterSize.argv
+++ b/tests/storagevolxml2argvdata/qcow2-clusterSize.argv
@@ -1,6 +1,6 @@
 qemu-img \
 create \
 -f qcow2 \
--o compat=0.10,cluster_size=131072 \
+-o compat=1.1,cluster_size=131072,extended_l2=on \
 /var/lib/libvirt/images/OtherDemo.img \
 5242880K
diff --git a/tests/storagevolxml2xmlin/vol-qcow2-clusterSize.xml b/tests/storagevolxml2xmlin/vol-qcow2-clusterSize.xml
index 22534982a1..2152a1f280 100644
--- a/tests/storagevolxml2xmlin/vol-qcow2-clusterSize.xml
+++ b/tests/storagevolxml2xmlin/vol-qcow2-clusterSize.xml
@@ -13,5 +13,8 @@
       <label>unconfined_u:object_r:virt_image_t:s0</label>
     </permissions>
     <clusterSize unit='KiB'>128</clusterSize>
+    <features>
+      <extended_l2/>
+    </features>
   </target>
 </volume>
diff --git a/tests/storagevolxml2xmlout/vol-qcow2-clusterSize.xml b/tests/storagevolxml2xmlout/vol-qcow2-clusterSize.xml
index 393a492536..40acb21ff8 100644
--- a/tests/storagevolxml2xmlout/vol-qcow2-clusterSize.xml
+++ b/tests/storagevolxml2xmlout/vol-qcow2-clusterSize.xml
@@ -12,6 +12,10 @@
       <group>0</group>
       <label>unconfined_u:object_r:virt_image_t:s0</label>
     </permissions>
+    <compat>1.1</compat>
     <clusterSize unit='B'>131072</clusterSize>
+    <features>
+      <extended_l2/>
+    </features>
   </target>
 </volume>