diff --git a/pkg/harvester/components/settings/instance-manager-resources.vue b/pkg/harvester/components/settings/instance-manager-resources.vue
new file mode 100644
index 00000000..58f879d5
--- /dev/null
+++ b/pkg/harvester/components/settings/instance-manager-resources.vue
@@ -0,0 +1,104 @@
+<script>
+import UnitInput from '@shell/components/form/UnitInput';
+import { Banner } from '@components/Banner';
+
+export default {
+  name: 'HarvesterInstanceManagerResources',
+
+  components: {
+    UnitInput,
+    Banner,
+  },
+
+  props: {
+    value: {
+      type:    Object,
+      default: () => ({
+        value:   '',
+        default: '{}'
+      })
+    },
+  },
+
+  data() {
+    const resources = this.parseJSON(this.value?.value) || this.parseJSON(this.value?.default) || {};
+
+    return {
+      resources,
+      parseError: null,
+    };
+  },
+
+  methods: {
+    parseJSON(string) {
+      try {
+        return JSON.parse(string);
+      } catch (e) {
+        this.parseError = this.t('harvester.setting.instanceManagerResources.parseError', { error: e.message });
+
+        return null;
+      }
+    },
+
+    update() {
+      if (!this.value) return;
+
+      const cpu = { ...this.resources?.cpu };
+
+      if (cpu.v1 !== null) cpu.v1 = String(cpu.v1);
+      if (cpu.v2 !== null) cpu.v2 = String(cpu.v2);
+
+      this.value.value = JSON.stringify({ ...this.resources, cpu });
+    },
+
+    useDefault() {
+      if (this.value?.default) {
+        this.resources = this.parseJSON(this.value.default) || {};
+        this.update();
+      }
+    },
+  },
+};
+</script>
+
+<template>
+  <div>
+    <Banner
+      v-if="parseError"
+      color="error"
+    >
+      {{ parseError }}
+    </Banner>
+
+    <div class="row">
+      <div class="col span-12">
+        <UnitInput
+          v-model:value="resources.cpu.v1"
+          :label="t('harvester.setting.instanceManagerResources.v1')"
+          suffix="%"
+          :delay="0"
+          type="number"
+          min="0"
+          max="100"
+          required
+          :mode="mode"
+          class="mb-20"
+          @update:value="update"
+        />
+        <UnitInput
+          v-model:value="resources.cpu.v2"
+          :label="t('harvester.setting.instanceManagerResources.v2')"
+          suffix="%"
+          :delay="0"
+          type="number"
+          min="0"
+          max="100"
+          required
+          :mode="mode"
+          class="mb-20"
+          @update:value="update"
+        />
+      </div>
+    </div>
+  </div>
+</template>
diff --git a/pkg/harvester/config/feature-flags.js b/pkg/harvester/config/feature-flags.js
index ed56b5f0..75a7e536 100644
--- a/pkg/harvester/config/feature-flags.js
+++ b/pkg/harvester/config/feature-flags.js
@@ -63,6 +63,7 @@ const FEATURE_FLAGS = {
     'supportBundleFileNameSetting',
     'clusterRegistrationTLSVerify',
     'vGPUAsPCIDevice',
+    'instanceManagerResourcesSetting',
   ],
 };
 
diff --git a/pkg/harvester/config/settings.ts b/pkg/harvester/config/settings.ts
index f29dd1e2..ac73427e 100644
--- a/pkg/harvester/config/settings.ts
+++ b/pkg/harvester/config/settings.ts
@@ -39,7 +39,8 @@ export const HCI_SETTING = {
   VM_MIGRATION_NETWORK:                   'vm-migration-network',
   RANCHER_CLUSTER:                        'rancher-cluster',
   MAX_HOTPLUG_RATIO:                      'max-hotplug-ratio',
-  KUBEVIRT_MIGRATION:                     'kubevirt-migration'
+  KUBEVIRT_MIGRATION:                     'kubevirt-migration',
+  INSTANCE_MANAGER_RESOURCES:             'instance-manager-resources'
 };
 
 export const HCI_ALLOWED_SETTINGS = {
@@ -122,6 +123,9 @@ export const HCI_ALLOWED_SETTINGS = {
   },
   [HCI_SETTING.KUBEVIRT_MIGRATION]: {
     kind: 'json', from: 'import', canReset: true, featureFlag: 'kubevirtMigration',
+  },
+  [HCI_SETTING.INSTANCE_MANAGER_RESOURCES]: {
+    kind: 'json', from: 'import', featureFlag: 'instanceManagerResourcesSetting'
   }
 };
 
diff --git a/pkg/harvester/l10n/en-us.yaml b/pkg/harvester/l10n/en-us.yaml
index 3c4bb299..04f847b4 100644
--- a/pkg/harvester/l10n/en-us.yaml
+++ b/pkg/harvester/l10n/en-us.yaml
@@ -1364,6 +1364,10 @@ harvester:
     ntpServers:
       isNotIPV4: The address you entered is not IPv4 or host. Please enter a valid IPv4 address or a host address.
       isDuplicate: There are duplicate NTP server configurations.
+    instanceManagerResources:
+      parseError: "Failed to parse configuration: {error}"
+      v1: "V1 Data Engine"
+      v2: "V2 Data Engine"
     kubevirtMigration:
       parseError: "Failed to parse configuration: {error}"
       parallelMigrationsPerCluster: "Parallel Migrations Per Cluster"
@@ -1998,6 +2002,7 @@ advancedSettings:
     'harv-rancher-cluster': 'Configure Rancher cluster integration settings for guest cluster management.'
     'harv-max-hotplug-ratio': 'The ratio for kubevirt to limit the maximum CPU and memory that can be hotplugged to a VM. The value could be an integer between 1 and 20, default to 4.'
     'harv-kubevirt-migration': 'Configure cluster-wide KubeVirt live migration parameters.'
+    'harv-instance-manager-resources': 'Configure resource percentage reservations for Longhorn instance manager V1 and V2. Valid instance manager CPU range between 0 - 40.'
 
 typeLabel:
   kubevirt.io.virtualmachine: |-