Provision Ubuntu VMs with NoCloud on Proxmox

Creating repeatable and secure VM templates in Proxmox has been a game-changer in refining and scaling my homelab environment.

In this post, I’ll show you how to:

• Use the NoCloud datasource with Ubuntu Cloud Images
• Inject SSH keys from your admin box
• Enable and verify the Proxmox guest agent
• Clone pre-configured VMs using Proxmox CLI

Let’s walk through the whole process—from image preparation to SSH-ready VM deployment.

For the latest Ubuntu Cloud images, you can check Ubuntu Cloud Images.

Step 1: Download the Ubuntu Cloud Image

From your Proxmox server, download the latest Ubuntu 24.04 cloud image:

wget -P /var/lib/vz/template/iso/ \
  https://cloud-images.ubuntu.com/daily/server/releases/24.04/release/ubuntu-24.04-server-cloudimg-amd64.img

Then verify:

ls /var/lib/vz/template/iso/ | grep -i ubuntu-

You should see the ubuntu-24.04-server-cloudimg-amd64.img file listed.

Step 2: Create a Base VM Template

2.1 Create the VM

First, create the base VM that will serve as your Ubuntu template. We’re using ID 501, but you can choose any unused ID.

qm create 501 \
  --name ubuntu-cloud-init-template \
  --memory 2048 \
  --cores 2 \
  --net0 virtio,bridge=vmbr0

2.2 Import the disk

Next, import the Ubuntu cloud image as a virtual disk into your Proxmox storage (in this case, local-zfs).

qm importdisk 501 /var/lib/vz/template/iso/ubuntu-24.04-server-cloudimg-amd64.img local-zfs

2.3 Set the VM disk and boot options

qm set 501 \
  --scsihw virtio-scsi-pci \
  --scsi0 local-zfs:vm-501-disk-0 \
  --boot c \
  --bootdisk scsi0

2.4 Attach Cloud-init disk

qm set 501 --ide2 local-zfs:cloudinit

2.5 Enable the qemu-guest-agent

qm set 501 --agent enabled=1

Step 3: Generate SSH Keys & NoCloud ISO

I’ll generate the ssh-keys from my Mac, but any admin workstation will do.

3.1 Generate a dedicated SSH key

ssh-keygen -t ed25519 -C "ubuntu-template" -f ~/.ssh/id_ed25519_ubuntu_template

This creates:

• ~/.ssh/id_ed25519_ubuntu_template
• ~/.ssh/id_ed25519_ubuntu_template.pub

3.2 Copy the public key

pbcopy < ~/.ssh/id_ed25519_ubuntu_template.pub

3.3 Create user-data and meta-data (cloud-init)

I’ll create the cloud-init configuration files that tell the VM how to initialize on first boot—things like hostname, users, and packages. The user-data file contains most of the logic, while meta-data just defines identity info for the instance.

mkdir -p /root/cloudinit/ubuntu-template
cd /root/cloudinit/ubuntu-template

Create the following files:
user-data

#cloud-config
hostname: ubuntu-template
users:
  - name: ubuntu
    ssh-authorized-keys:
      - paste_the_public_key_you_copied_earlier
    sudo: ALL=(ALL) NOPASSWD:ALL
    shell: /bin/bash
package_update: true
package_upgrade: true
packages:
  - qemu-guest-agent
runcmd:
  - systemctl enable qemu-guest-agent
  - systemctl start qemu-guest-agent

meta-data

instance-id: ubuntu-template
local-hostname: ubuntu-template

3.4 Generate the ISO (on Proxmox)

Make sure you have cloud-image-utils installed:

apt update
apt install cloud-image-utils

This gives you access to the cloud-localds command you need.

Then, generate the iso:

cloud-localds nocloud.iso user-data meta-data

3.5 Move ISO to /var/lib/vz/template/iso/

mv nocloud.iso /var/lib/vz/template/iso/

If your Proxmox storage uses local-lvm instead of local-zfs, adjust the path accordingly.
You can check available storage with: pvesm status

3.6 Attach ISO to VM

qm set 501 --ide2 local:iso/nocloud.iso,media=cdrom

Replace local if your ISO storage is named differently — use pvesm status to check.

Step 4: Convert to a Template

Once your base VM is configured, convert it to a Proxmox template so you can quickly clone new VMs from it.

qm template 501

Step 5: Clone and Deploy

5.1 Clone the template

qm clone 501 105 --name "ubuntu-vm01"

5.2 Customize the new VM

qm set 105 --memory 4096 --cores 4

5.3 Start up the VM

qm start 105

Remember to update the new IP address of the server in your ~/.ssh/config file, as shown below.

~/.ssh/config

Host ubuntu
  HostName 10.160.0.64
  User ubuntu
  IdentityFile ~/.ssh/id_ed25519_ubuntu_template

Now you can type ssh ubuntu to connect to your newly created VM.

I use this setup regularly when provisioning dev servers or test environments—it saves a ton of time.

You now have a clean and SSH-ready NoCloud Ubuntu template:

• Ideal for hands-off provisioning
• Cloud-init friendly
• Guest agent enabled out of the box

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