diff --git a/.github/workflows/build_test_cbsinit.yml b/.github/workflows/build_test_cbsinit.yml
index 2cfa3ddd..89c63561 100644
--- a/.github/workflows/build_test_cbsinit.yml
+++ b/.github/workflows/build_test_cbsinit.yml
@@ -10,7 +10,8 @@ jobs:
       matrix:
         os: ['windows-2022']
         download_official_python_msi: ["true"]
-        remove_python_pycs: ["true"]
+        remove_python_pycs: ["false"]
+        install_with_pymanager: ["true"]
         cbsinit_repo: ['https://github.com/cloudbase/cloudbase-init']
         cbsinit_branch: ['master']
         python_version: ['3.14_4']
@@ -34,10 +35,11 @@ jobs:
             -CloudbaseInitRepoBranch ${{ matrix.cbsinit_branch }} ^
             -InstallOfficialPythonMsi:$${{ matrix.download_official_python_msi }} ^
             -OfficialPythonMsiChecksum "C10234D0D9BD89F6F6DD55BAE28EDE0F97EE0DF4" ^
-            -RemovePythonPycs:$${{ matrix.remove_python_pycs }}
+            -RemovePythonPycs:$${{ matrix.remove_python_pycs }} ^
+            -InstallOfficialPythonUsingPyManager:$${{ matrix.install_with_pymanager }}
     - uses: actions/upload-artifact@v7
       with:
-        name: "CloudbaseInit_platform-${{ matrix.platform }}_build-env-os-${{ matrix.os }}_download-official-msi-${{ matrix.download_official_python_msi }}_remove-pycs-${{ matrix.remove_python_pycs }}_cbs-init-branch-${{ matrix.cbsinit_branch }}_MSI"
+        name: "CloudbaseInit_platform-${{ matrix.platform }}_build-env-os-${{ matrix.os }}_download-official-msi-${{ matrix.download_official_python_msi }}_remove-pycs-${{ matrix.remove_python_pycs }}_install-with-pymanager${{ matrix.install_with_pymanager }}_cbs-init-branch-${{ matrix.cbsinit_branch }}_MSI"
         path: 'CloudbaseInitSetup/bin/release/${{ matrix.platform }}/CloudbaseInitSetup.msi'
     - name: Download external dependencies
       shell: powershell
@@ -99,6 +101,7 @@ jobs:
             }
         }
         & $pythonPath -m pip install pip-audit
+        & $pythonPath -m pip install venv
         $pipAuditLogs = & $pipAuditPath
         Write-Output "$pipAuditLogs"
         if ($LASTEXITCODE) {
diff --git a/BuildAutomation/BuildCloudbaseInitSetup.ps1 b/BuildAutomation/BuildCloudbaseInitSetup.ps1
index 1ad9a7c1..870cb795 100644
--- a/BuildAutomation/BuildCloudbaseInitSetup.ps1
+++ b/BuildAutomation/BuildCloudbaseInitSetup.ps1
@@ -13,7 +13,8 @@ Param(
   [string]$VCVars = "2019",
   [switch]$InstallOfficialPythonMsi = $false,
   [string]$OfficialPythonMsiChecksum = "C10234D0D9BD89F6F6DD55BAE28EDE0F97EE0DF4",
-  [switch]$RemovePythonPycs = $false
+  [switch]$RemovePythonPycs = $false,
+  [switch]$InstallOfficialPythonUsingPyManager = $false
 )
 
 $ErrorActionPreference = "Stop"
@@ -80,16 +81,31 @@ try
 
     $python_template_dir = join-path $cloudbaseInitInstallerDir "Python$($pythonversion.replace('.', ''))_${platform}_Template"
 
+    # TODO(avladu): stick to just only one way to download Python, preferably the pymanager once it gets ironed out
     if ($InstallOfficialPythonMsi) {
-        if (!$OfficialPythonMsiChecksum) {
-            throw "Please set a OfficialPythonMsiChecksum parameter value."
+        if ($InstallOfficialPythonUsingPyManager) {
+                Remove-Item -Recurse -Force $python_template_dir -ErrorAction SilentlyContinue
+                DownloadInstall-PythonUsingPyManager $platform $python_template_dir $pythonversion
+        } else {
+                if (!$OfficialPythonMsiChecksum) {
+                    throw "Please set a OfficialPythonMsiChecksum parameter value."
+                }
+                Remove-Item -Recurse -Force $python_template_dir -ErrorAction SilentlyContinue
+                DownloadInstall-PythonMsi $platform $python_template_dir $pythonversion $OfficialPythonMsiChecksum
         }
-        Remove-Item -Recurse -Force $python_template_dir -ErrorAction SilentlyContinue
-        DownloadInstall-PythonMsi $platform $python_template_dir $pythonversion $OfficialPythonMsiChecksum
     }
 
     CheckCopyDir $python_template_dir $python_dir
 
+    $pythonGetPipUrl = "https://bootstrap.pypa.io/get-pip.py"
+    $pythonGetPipPath = Join-Path (Resolve-Path "${python_dir}/..").Path "/get-pip.py"
+    ExecRetry { DownloadFile $pythonGetPipUrl $pythonGetPipPath }
+
+    & python.exe "${pythonGetPipPath}"
+    if ($LASTEXITCODE) {
+        throw "Failed to install pip in directory: ${python_dir}"
+    }
+    
     # Make sure that we don't have temp files from a previous build
     $python_build_path = "$ENV:LOCALAPPDATA\Temp\pip_build_$ENV:USERNAME"
     if (Test-Path $python_build_path) {
@@ -97,6 +113,11 @@ try
     }
 
     ExecRetry { PipInstall "pip" -update $true }
+    # When using embed Python, pbr needs to be reinstalled so that the project builds
+    # Warning received: UserWarning: Unknown distribution option: 'pbr'
+    # pbr is already installed but most likely this is a problem with knowing where it is,
+    # and reinstalling fixing the issue
+    ExecRetry { PipInstall "pbr" -update $true }
     ExecRetry { PipInstall "wheel" -update $true }
     ExecRetry { PipInstall "setuptools" -update $true }
 
diff --git a/BuildAutomation/BuildUtils.ps1 b/BuildAutomation/BuildUtils.ps1
index 604f52e2..405b3ec2 100644
--- a/BuildAutomation/BuildUtils.ps1
+++ b/BuildAutomation/BuildUtils.ps1
@@ -460,3 +460,77 @@ function DownloadInstall-PythonMsi($platform, $python_template_dir, $pythonVersi
       }
 
 }
+
+function DownloadInstall-PythonUsingPyManager($platform, $python_template_dir, $pythonVersion) {
+    $pythonManagerUrl = "https://www.python.org/ftp/python/pymanager/python-manager-26.1.msix"
+    $pythonManagerPath = Join-Path (Resolve-Path "${python_template_dir}/..").Path "/python-manager.exe"
+
+    $pythonManagerPackage = Get-AppPackage -Name PythonSoftwareFoundation.PythonManager -ErrorAction SilentlyContinue
+
+    if (!$pythonManagerPackage) {
+        ExecRetry { DownloadFile $pythonManagerUrl $pythonManagerPath }
+        Add-AppPackage -Path $pythonManagerPath
+    }
+
+    $platformSuffix = ""
+    if ($platform -eq "x86") {
+        $platformSuffix = "-32"
+    }
+    if ($platform -eq "arm64") {
+        $platformSuffix = "-arm64"
+    }
+
+    if (Test-Path $python_template_dir) {
+        throw "$python_template_dir folder already exists"
+    }
+
+    $pythonVersionEscaped = "PythonEmbed\" + $pythonVersion.replace("_",".") + $platformSuffix
+    pymanager.exe install --target=$python_template_dir --force --update $pythonVersionEscaped
+    if ($LASTEXITCODE) {
+        throw "Failed to install python in directory: ${python_template_dir}"
+    }
+
+    if (!(Test-Path $python_template_dir)) {
+        throw "$python_template_dir has not been created"
+    }
+
+    & "$python_template_dir/python.exe" --version
+    if ($LASTEXITCODE) {
+        throw "Failed to run python in directory: ${python_template_dir}"
+    }
+
+    Out-File -Append -InputObject "Lib\site-packages" -Encoding ascii $python_template_dir\python*._pth
+    Out-File -Append -InputObject "libs" -Encoding ascii $python_template_dir\python*._pth
+
+    $python_template_dir_full = $python_template_dir + "_full"
+    $pythonVersionEscaped = $pythonVersion.replace("_",".") + $platformSuffix
+    pymanager.exe install --target=$python_template_dir_full --force --update $pythonVersionEscaped
+    if ($LASTEXITCODE) {
+        throw "Failed to install python in directory: ${python_template_dir_full}"
+    }
+
+    Move-Item $python_template_dir_full/include $python_template_dir/
+    Move-Item $python_template_dir_full/libs $python_template_dir/
+
+    mkdir $python_template_dir\Lib\site-packages
+
+    Out-File -Append -InputObject "win32" -Encoding ascii "$python_template_dir\Lib\site-packages\pywin32.pth"
+    Out-File -Append -InputObject "win32\lib" -Encoding ascii "$python_template_dir\Lib\site-packages\pywin32.pth"
+    Out-File -Append -InputObject "Pythonwin" -Encoding ascii "$python_template_dir\Lib\site-packages\pywin32.pth"
+    Out-File -Append -InputObject "import pywin32_bootstrap" -Encoding ascii "$python_template_dir\Lib\site-packages\pywin32.pth"
+
+    Out-File -Append -InputObject "Lib\site-packages\win32" -Encoding ascii $python_template_dir\python*._pth
+    Out-File -Append -InputObject "Lib\site-packages\win32\lib" -Encoding ascii $python_template_dir\python*._pth
+    Out-File -Append -InputObject "Lib\site-packages\Pythonwin" -Encoding ascii $python_template_dir\python*._pth
+
+    Remove-Item -Force -Recurse "$python_template_dir_full" -ErrorAction SilentlyContinue
+
+    Remove-Item -Force -Recurse "$python_template_dir/DLLs/_tkinter.pyd" -ErrorAction SilentlyContinue
+    Remove-Item -Force -Recurse "$python_template_dir/DLLs/tcl*.dll" -ErrorAction SilentlyContinue
+    Remove-Item -Force -Recurse "$python_template_dir/DLLs/tk*.dll" -ErrorAction SilentlyContinue
+    Remove-Item -Force -Recurse "$python_template_dir/Doc" -ErrorAction SilentlyContinue
+    Remove-Item -Force -Recurse "$python_template_dir/Lib/tkinter" -ErrorAction SilentlyContinue
+    Remove-Item -Force -Recurse "$python_template_dir/Lib/turtle.py" -ErrorAction SilentlyContinue
+    Remove-Item -Force -Recurse "$python_template_dir/Lib/turtledemo" -ErrorAction SilentlyContinue
+    Remove-Item -Force -Recurse "$python_template_dir/tcl" -ErrorAction SilentlyContinue
+}