diff --git a/package/dracut/dracut.mk b/package/dracut/dracut.mk
index 742a073a36..597492bc5e 100644
--- a/package/dracut/dracut.mk
+++ b/package/dracut/dracut.mk
@@ -22,6 +22,8 @@ HOST_DRACUT_POST_INSTALL_HOOKS += HOST_DRACUT_POST_INSTALL_WRAPPER_SCRIPT
 # "ld-musl-x.so" symlinks, respectively - else the init process cannot
 # start
 define HOST_DRACUT_POST_INSTALL_LIBC_LINKS_MODULE
+	$(INSTALL) -D -m 0755 package/dracut/merged-usr-module-setup.sh \
+		$(HOST_DIR)/lib/dracut/modules.d/0000-merged-usr/module-setup.sh
 	$(INSTALL) -D -m 0755 package/dracut/libc-links-module-setup.sh \
 		$(HOST_DIR)/lib/dracut/modules.d/05libc-links/module-setup.sh
 endef
diff --git a/package/dracut/merged-usr-module-setup.sh b/package/dracut/merged-usr-module-setup.sh
new file mode 100644
index 0000000000..6dc0e7ca7b
--- /dev/null
+++ b/package/dracut/merged-usr-module-setup.sh
@@ -0,0 +1,26 @@
+#!/bin/bash
+
+check() {
+    [ -L "${dracutsysrootdir?}/lib" ]
+}
+
+depends() {
+    return 0
+}
+
+install() {
+    # dracut pre-installs a set of files before calling any of
+    # the modules, and dracut also messes up host vs. target
+    # system, so on a non-merged-usr host, it will prepare a
+    # non-merged-usr initramfs, even though the current config
+    # is for a merged-usr system.
+    # So undo its borkage.
+    for dir in lib bin sbin; do
+        mkdir -p "${initdir?}/usr/${dir}"
+        if [ -d "${initdir?}/${dir}" ]; then
+            mv "${initdir?}/${dir}/"* "${initdir?}/usr/${dir}"
+            rm -rf "${initdir?}/${dir}"
+            ln -s "usr/${dir}" "${initdir?}/${dir}"
+        fi
+    done
+}