diff --git a/ironic_python_agent/extensions/standby.py b/ironic_python_agent/extensions/standby.py
index 74f244e0a..bdf338a9d 100644
--- a/ironic_python_agent/extensions/standby.py
+++ b/ironic_python_agent/extensions/standby.py
@@ -206,7 +206,17 @@ def _write_whole_disk_image(image, image_info, device):
         # TODO(dtantsur): switch to disk_utils.convert_image when it supports
         # -t and -W flags and defaults to 2 GiB memory limit.
         limits = processutils.ProcessLimits(address_space=2048 * units.Mi)
-        utils.execute(*command, prlimit=limits)
+        # TODO(TheJulia): qemu-img uses a default of 8 * nCPU to determine
+        # how many chunks of memory to allocate based upon the discussion in
+        # https://bugzilla.redhat.com/show_bug.cgi?id=1892773.
+        # Setting MALLOC_AREA_MAX=1 results in a process memory footprint of
+        # ~250mb. Setting it to 3 will allow for multiple areas, but won't
+        # greatly exceed the footprint.
+        env_vars = {'MALLOC_ARENA_MAX': '3'}
+        # Entirely disabling threading results in the same memory footprint
+        # as 1 areana, but multiple threads are useful for performance
+        # as the file could be fragmented/compressed.
+        utils.execute(*command, prlimit=limits, env_variables=env_vars)
     except processutils.ProcessExecutionError as e:
         raise errors.ImageWriteError(device, e.exit_code, e.stdout, e.stderr)
 
diff --git a/ironic_python_agent/tests/unit/extensions/test_standby.py b/ironic_python_agent/tests/unit/extensions/test_standby.py
index 6f905a36a..e75000275 100644
--- a/ironic_python_agent/tests/unit/extensions/test_standby.py
+++ b/ironic_python_agent/tests/unit/extensions/test_standby.py
@@ -182,7 +182,9 @@ class TestStandbyExtension(base.IronicAgentTest):
 
         standby._write_image(image_info, device)
 
-        execute_mock.assert_called_once_with(*command, prlimit=mock.ANY)
+        execute_mock.assert_called_once_with(
+            *command, prlimit=mock.ANY,
+            env_variables={'MALLOC_ARENA_MAX': '3'})
         wipe_mock.assert_called_once_with(device, '')
         udev_mock.assert_called_once_with()
         rescan_mock.assert_called_once_with(device)
diff --git a/releasenotes/notes/limit-qemu-img-malloc-arena-025ed84115481eae.yaml b/releasenotes/notes/limit-qemu-img-malloc-arena-025ed84115481eae.yaml
new file mode 100644
index 000000000..38ddf24ea
--- /dev/null
+++ b/releasenotes/notes/limit-qemu-img-malloc-arena-025ed84115481eae.yaml
@@ -0,0 +1,7 @@
+---
+fixes:
+  - |
+    Fixes failures with disk image conversions which result in memory
+    allocation or input/output errors due to memory limitations by limiting
+    the number of available memory allocation pools to a non-dynamic
+    reasonable number which should not exceed the available system memory.