diff --git a/api-ref/source/api-ref-sysinv-v1-config.rst b/api-ref/source/api-ref-sysinv-v1-config.rst
index 86ba3eff39..ee1e8408d1 100644
--- a/api-ref/source/api-ref-sysinv-v1-config.rst
+++ b/api-ref/source/api-ref-sysinv-v1-config.rst
@@ -5137,6 +5137,7 @@ itemNotFound (404)
    "description (Optional)", "plain", "xsd:string", "The description of the device image."
    "image_version (Optional)", "plain", "xsd:string", "The version of the device image."
    "applied_labels (Optional)", "plain", "xsd:list", "The device image applied to the device labels."
+   "bmc (Optional)", "plain", "xsd:boolean", "This indicates whether it is a BMC functional image."
    "retimer_included (Optional)", "plain", "xsd:boolean", "This indicates whether the retimer firmware is included in the BMC functional image."
    "uuid (Optional)", "plain", "csapi:UUID", "The universally unique identifier for this object."
    "links (Optional)", "plain", "xsd:list", "For convenience, resources contain links to themselves. This allows a client to easily obtain rather than construct resource URIs. The following types of link relations are associated with resources: a self link containing a versioned link to the resource, and a bookmark link containing a permanent link to a resource that is appropriate for long term storage."
@@ -5156,6 +5157,7 @@ itemNotFound (404)
             "description": null,
             "name": null,
             "image_version": null,
+            "bmc": false,
             "retimer_included": false,
             "applied_labels":
                {
@@ -5235,6 +5237,7 @@ itemNotFound (404)
    "description (Optional)", "plain", "xsd:string", "The description of the device image."
    "image_version (Optional)", "plain", "xsd:string", "The version of the device image."
    "applied_labels (Optional)", "plain", "xsd:list", "The device image applied to the device labels."
+   "bmc (Optional)", "plain", "xsd:boolean", "This indicates whether it is a BMC functional image."
    "retimer_included (Optional)", "plain", "xsd:boolean", "This indicates whether the retimer firmware is included in the BMC functional image."
    "uuid (Optional)", "plain", "csapi:UUID", "The universally unique identifier for this object."
    "links (Optional)", "plain", "xsd:list", "For convenience, resources contain links to themselves. This allows a client to easily obtain rather than construct resource URIs. The following types of link relations are associated with resources: a self link containing a versioned link to the resource, and a bookmark link containing a permanent link to a resource that is appropriate for long term storage."
@@ -5254,6 +5257,7 @@ itemNotFound (404)
             "description": null,
             "name": null,
             "image_version": null,
+            "bmc": false,
             "retimer_included": false,
             "applied_labels":
                {
@@ -5293,6 +5297,7 @@ badMediaType (415)
    "name (Optional)", "plain", "xsd:string", "The name of the device image."
    "description (Optional)", "plain", "xsd:string", "The description of the device image."
    "image_version (Optional)", "plain", "xsd:string", "The version of the device image."
+   "bmc (Optional)", "plain", "xsd:boolean", "This indicates whether it is a BMC functional image."
    "retimer_included (Optional)", "plain", "xsd:boolean", "This indicates whether the retimer firmware is included in the BMC functional image."
 
 **Response parameters**
@@ -5310,6 +5315,7 @@ badMediaType (415)
    "name (Optional)", "plain", "xsd:string", "The name of the device image."
    "description (Optional)", "plain", "xsd:string", "The description of the device image."
    "image_version (Optional)", "plain", "xsd:string", "The version of the device image."
+   "bmc (Optional)", "plain", "xsd:boolean", "This indicates whether it is a BMC functional image."
    "retimer_included (Optional)", "plain", "xsd:boolean", "This indicates whether the retimer firmware is included in the BMC functional image."
    "applied_labels (Optional)", "plain", "xsd:list", "The device image applied to the device labels."
    "uuid (Optional)", "plain", "csapi:UUID", "The universally unique identifier for this object."
@@ -5329,6 +5335,7 @@ badMediaType (415)
             "description": null,
             "name": null,
             "image_version": null,
+            "bmc": false,
             "retimer_included": false,
             "applied_labels": null
          }
@@ -5380,6 +5387,7 @@ badMediaType (415)
    "name (Optional)", "plain", "xsd:string", "The name of the device image."
    "description (Optional)", "plain", "xsd:string", "The description of the device image."
    "image_version (Optional)", "plain", "xsd:string", "The version of the device image."
+   "bmc (Optional)", "plain", "xsd:boolean", "This indicates whether it is a BMC functional image."
    "retimer_included (Optional)", "plain", "xsd:boolean", "This indicates whether the retimer firmware is included in the BMC functional image."
    "applied_labels (Optional)", "plain", "xsd:list", "The device image applied to the device labels."
    "uuid (Optional)", "plain", "csapi:UUID", "The universally unique identifier for this object."
@@ -5399,6 +5407,7 @@ badMediaType (415)
             "description": null,
             "name": null,
             "image_version": null,
+            "bmc": false,
             "retimer_included": false,
             "applied_labels":
                {
@@ -5454,6 +5463,7 @@ badMediaType (415)
    "name (Optional)", "plain", "xsd:string", "The name of the device image."
    "description (Optional)", "plain", "xsd:string", "The description of the device image."
    "image_version (Optional)", "plain", "xsd:string", "The version of the device image."
+   "bmc (Optional)", "plain", "xsd:boolean", "This indicates whether it is a BMC functional image."
    "retimer_included (Optional)", "plain", "xsd:boolean", "This indicates whether the retimer firmware is included in the BMC functional image."
    "applied_labels (Optional)", "plain", "xsd:list", "The device image applied to the device labels."
    "uuid (Optional)", "plain", "csapi:UUID", "The universally unique identifier for this object."
@@ -5473,6 +5483,7 @@ badMediaType (415)
             "description": null,
             "name": null,
             "image_version": null,
+            "bmc": false,
             "retimer_included": false,
             "applied_labels": null
          }
diff --git a/sysinv/cgts-client/cgts-client/cgtsclient/v1/device_image.py b/sysinv/cgts-client/cgts-client/cgtsclient/v1/device_image.py
index 295e71c9b9..acad084e54 100644
--- a/sysinv/cgts-client/cgts-client/cgtsclient/v1/device_image.py
+++ b/sysinv/cgts-client/cgts-client/cgtsclient/v1/device_image.py
@@ -1,5 +1,5 @@
 #
-# Copyright (c) 2020 Wind River Systems, Inc.
+# Copyright (c) 2020-2021 Wind River Systems, Inc.
 #
 # SPDX-License-Identifier: Apache-2.0
 #
@@ -12,7 +12,7 @@ from cgtsclient import exc
 CREATION_ATTRIBUTES = [
     'bitstream_type', 'pci_vendor', 'pci_device',
     'bitstream_id', 'key_signature', 'revoke_key_id',
-    'name', 'description', 'image_version', 'uuid', 'retimer_included']
+    'name', 'description', 'image_version', 'uuid', 'bmc', 'retimer_included']
 
 
 class DeviceImage(base.Resource):
diff --git a/sysinv/cgts-client/cgts-client/cgtsclient/v1/device_image_shell.py b/sysinv/cgts-client/cgts-client/cgtsclient/v1/device_image_shell.py
index 2a2d82755f..a4f60976ce 100644
--- a/sysinv/cgts-client/cgts-client/cgtsclient/v1/device_image_shell.py
+++ b/sysinv/cgts-client/cgts-client/cgtsclient/v1/device_image_shell.py
@@ -1,5 +1,5 @@
 #
-# Copyright (c) 2020 Wind River Systems, Inc.
+# Copyright (c) 2020-2021 Wind River Systems, Inc.
 #
 # SPDX-License-Identifier: Apache-2.0
 #
@@ -13,7 +13,7 @@ def _print_device_image_show(obj):
               'pci_vendor', 'pci_device',
               'bitstream_id', 'key_signature', 'revoke_key_id',
               'name', 'description', 'image_version',
-              'applied', 'applied_labels', 'retimer_included']
+              'applied', 'applied_labels', 'bmc', 'retimer_included']
 
     if isinstance(obj, dict):
         data = [(f, obj.get(f, '')) for f in fields]
@@ -37,11 +37,11 @@ def do_device_image_list(cc, args):
 
     labels = ['uuid', 'bitstream_type', 'pci_vendor', 'pci_device',
               'bitstream_id', 'key_signature', 'revoke_key_id',
-              'name', 'description', 'image_version', 'retimer_included',
+              'name', 'description', 'image_version', 'bmc', 'retimer_included',
               'applied', 'applied_labels']
     fields = ['uuid', 'bitstream_type', 'pci_vendor', 'pci_device',
               'bitstream_id', 'key_signature', 'revoke_key_id',
-              'name', 'description', 'image_version', 'retimer_included',
+              'name', 'description', 'image_version', 'bmc', 'retimer_included',
               'applied', 'applied_labels']
     device_images = cc.device_image.list()
     utils.print_list(device_images, fields, labels, sortby=1)
@@ -81,6 +81,9 @@ def do_device_image_list(cc, args):
 @utils.arg('-u', '--uuid',
            metavar='<uuid>',
            help='UUID of the device image')
+@utils.arg('--bmc',
+           metavar='<true/false>',
+           help='BMC image')
 @utils.arg('--retimer-included',
            metavar='<true/false>',
            help='Retimer firmware included in BMC FW binary')
@@ -93,7 +96,7 @@ def do_device_image_upload(cc, args):
 
     field_list = ['uuid', 'bitstream_type', 'pci_vendor', 'pci_device',
                   'bitstream_id', 'key_signature', 'revoke_key_id',
-                  'name', 'description', 'image_version', 'retimer_included']
+                  'name', 'description', 'image_version', 'bmc', 'retimer_included']
 
     # Prune input fields down to required/expected values
     user_fields = dict((k, v) for (k, v) in vars(args).items()
diff --git a/sysinv/sysinv/sysinv/sysinv/api/controllers/v1/device_image.py b/sysinv/sysinv/sysinv/sysinv/api/controllers/v1/device_image.py
index c9bcd7ef85..986a8253a4 100644
--- a/sysinv/sysinv/sysinv/sysinv/api/controllers/v1/device_image.py
+++ b/sysinv/sysinv/sysinv/sysinv/api/controllers/v1/device_image.py
@@ -1,9 +1,10 @@
 #
-# Copyright (c) 2020 Wind River Systems, Inc.
+# Copyright (c) 2020-2021 Wind River Systems, Inc.
 #
 # SPDX-License-Identifier: Apache-2.0
 #
 
+from distutils.util import strtobool
 import os
 import pecan
 from pecan import expose
@@ -81,6 +82,9 @@ class DeviceImage(base.APIBase):
     image_version = wtypes.text
     "The version of the device image"
 
+    bmc = bool
+    "Represent the functional image is a BMC image"
+
     retimer_included = bool
     "Retimer firmware included in BMC firmware binary"
 
@@ -112,7 +116,7 @@ class DeviceImage(base.APIBase):
                 ['id', 'uuid', 'bitstream_type', 'pci_vendor', 'pci_device',
                  'bitstream_id', 'key_signature', 'revoke_key_id',
                  'name', 'description', 'image_version',
-                 'applied', 'applied_labels', 'retimer_included'])
+                 'applied', 'applied_labels', 'bmc', 'retimer_included'])
 
         # insert applied labels for this device image if they exist
         device_image = _get_applied_labels(device_image)
@@ -249,7 +253,7 @@ class DeviceImageController(rest.RestController):
 
         field_list = ['uuid', 'bitstream_type', 'pci_vendor', 'pci_device',
                       'bitstream_id', 'key_signature', 'revoke_key_id',
-                      'name', 'description', 'image_version', 'retimer_included']
+                      'name', 'description', 'image_version', 'bmc', 'retimer_included']
         data = dict((k, v) for (k, v) in pecan.request.POST.items()
                 if k in field_list and not (v is None))
         msg = _validate_syntax(data)
@@ -434,9 +438,21 @@ def _validate_bitstream_type(dev_img):
     elif (dev_img['bitstream_type'] == dconstants.BITSTREAM_TYPE_KEY_REVOCATION and
           'revoke_key_id' not in dev_img):
         msg = _("revoke_key_id is required for key revocation bitstream type")
+    elif (dev_img['bitstream_type'] != dconstants.BITSTREAM_TYPE_FUNCTIONAL and
+          'bmc' in dev_img.keys()):
+        msg = _("bmc option is only applicable to functional image")
     elif (dev_img['bitstream_type'] != dconstants.BITSTREAM_TYPE_FUNCTIONAL and
           'retimer_included' in dev_img.keys()):
         msg = _("retimer_included option is only applicable to functional BMC image")
+    elif dev_img['bitstream_type'] == dconstants.BITSTREAM_TYPE_FUNCTIONAL:
+        bmc = False
+        retimer_included = False
+        if 'bmc' in dev_img.keys():
+            bmc = bool(strtobool(dev_img['bmc']))
+        if 'retimer_included' in dev_img.keys():
+            retimer_included = bool(strtobool(dev_img['retimer_included']))
+        if not bmc and retimer_included:
+            msg = _("retimer_included option is only applicable to functional BMC image")
     return msg
 
 
@@ -483,6 +499,10 @@ def _validate_syntax(device_image):
             not cutils.is_uuid_like(device_image['uuid'])):
         msg = _("uuid must be a valid UUID")
         return msg
+    if ('bmc' in device_image.keys() and
+            not cutils.is_valid_boolstr(device_image['bmc'])):
+        msg = _("Parameter bmc must be a valid bool string")
+        return msg
     if ('retimer_included' in device_image.keys() and
             not cutils.is_valid_boolstr(device_image['retimer_included'])):
         msg = _("Parameter retimer_included must be a valid bool string")
@@ -566,16 +586,27 @@ def process_device_image_apply(pcidevice_id, device_image, label_id=None):
                         # return False for nothing to do
                         response = False
                 else:
-                    # Remove the existing device_image_state record
-                    pecan.request.dbapi.device_image_state_destroy(r.uuid)
-                    # Remove the existing device image label if any
-                    if label_id:
-                        try:
-                            img_lbl = pecan.request.dbapi.device_image_label_get_by_image_label(
-                                img.id, label_id)
-                            pecan.request.dbapi.device_image_label_destroy(img_lbl.uuid)
-                        except exception.DeviceImageLabelNotFoundByKey:
-                            pass
+                    do_remove = True
+                    # If the new image and the applied image are of a different kind (user/bmc),
+                    # do not remove the image.
+                    # If the new BMC image does not have retimer and an applied BMC image
+                    # does have retimer, keep that applied device image state.
+                    if device_image.bmc != img.bmc:
+                        do_remove = False
+                    if (device_image.bmc and
+                            (not device_image.retimer_included and img.retimer_included)):
+                        do_remove = False
+                    if do_remove:
+                        # Remove the existing device_image_state record
+                        pecan.request.dbapi.device_image_state_destroy(r.uuid)
+                        # Remove the existing device image label if any
+                        if label_id:
+                            try:
+                                img_lbl = pecan.request.dbapi.device_image_label_get_by_image_label(
+                                    img.id, label_id)
+                                pecan.request.dbapi.device_image_label_destroy(img_lbl.uuid)
+                            except exception.DeviceImageLabelNotFoundByKey:
+                                pass
             elif img.bitstream_type == dconstants.BITSTREAM_TYPE_KEY_REVOCATION:
                 if img.id == device_image.id:
                     if r.status in [dconstants.DEVICE_IMAGE_UPDATE_COMPLETED,
diff --git a/sysinv/sysinv/sysinv/sysinv/db/sqlalchemy/migrate_repo/versions/123_device_image_bmc.py b/sysinv/sysinv/sysinv/sysinv/db/sqlalchemy/migrate_repo/versions/123_device_image_bmc.py
new file mode 100644
index 0000000000..4db4b42ea3
--- /dev/null
+++ b/sysinv/sysinv/sysinv/sysinv/db/sqlalchemy/migrate_repo/versions/123_device_image_bmc.py
@@ -0,0 +1,23 @@
+#
+# Copyright (c) 2021 Wind River Systems, Inc.
+#
+# SPDX-License-Identifier: Apache-2.0
+#
+
+from sqlalchemy import Boolean, Column, MetaData, Table
+
+ENGINE = 'InnoDB'
+CHARSET = 'utf8'
+
+
+def upgrade(migrate_engine):
+    meta = MetaData()
+    meta.bind = migrate_engine
+
+    dev_img_functional = Table('device_images_functional', meta, autoload=True)
+    dev_img_functional.create_column(Column('bmc', Boolean, default=False))
+
+
+def downgrade(migrate_engine):
+    # Downgrade is unsupported in this release.
+    raise NotImplementedError('SysInv database downgrade is unsupported.')
diff --git a/sysinv/sysinv/sysinv/sysinv/db/sqlalchemy/models.py b/sysinv/sysinv/sysinv/sysinv/db/sqlalchemy/models.py
index 1ddfbc3616..5c7864a38f 100644
--- a/sysinv/sysinv/sysinv/sysinv/db/sqlalchemy/models.py
+++ b/sysinv/sysinv/sysinv/sysinv/db/sqlalchemy/models.py
@@ -1593,6 +1593,7 @@ class DeviceImageFunctional(DeviceImageCommon, DeviceImage):
     __tablename__ = 'device_images_functional'
 
     bitstream_id = Column(String(255), nullable=True)
+    bmc = Column(Boolean, nullable=False, default=False)
     retimer_included = Column(Boolean, nullable=False, default=False)
 
     __mapper_args__ = {
diff --git a/sysinv/sysinv/sysinv/sysinv/objects/device_image.py b/sysinv/sysinv/sysinv/sysinv/objects/device_image.py
index e3c3d9b5cc..c3a20fc045 100644
--- a/sysinv/sysinv/sysinv/sysinv/objects/device_image.py
+++ b/sysinv/sysinv/sysinv/sysinv/objects/device_image.py
@@ -1,5 +1,5 @@
 #
-# Copyright (c) 2020 Wind River Systems, Inc.
+# Copyright (c) 2020-2021 Wind River Systems, Inc.
 #
 # SPDX-License-Identifier: Apache-2.0
 #
@@ -27,6 +27,7 @@ class DeviceImage(base.SysinvObject):
               'image_version': utils.str_or_none,
               'applied': utils.bool_or_none,
               'capabilities': utils.dict_or_none,
+              'bmc': utils.bool_or_none,
               'retimer_included': utils.bool_or_none,
               }
 
@@ -36,6 +37,7 @@ class DeviceImage(base.SysinvObject):
                         'name',
                         'description',
                         'image_version',
+                        'bmc',
                         'retimer_included'}
 
     @base.remotable_classmethod
diff --git a/sysinv/sysinv/sysinv/sysinv/tests/api/test_device_image.py b/sysinv/sysinv/sysinv/sysinv/tests/api/test_device_image.py
index 51744a8359..e7350221fa 100644
--- a/sysinv/sysinv/sysinv/sysinv/tests/api/test_device_image.py
+++ b/sysinv/sysinv/sysinv/sysinv/tests/api/test_device_image.py
@@ -1,5 +1,5 @@
 #
-# Copyright (c) 2020 Wind River Systems, Inc.
+# Copyright (c) 2020-2021 Wind River Systems, Inc.
 #
 # SPDX-License-Identifier: Apache-2.0
 #
@@ -295,6 +295,25 @@ class TestPostDeviceImage(TestDeviceImage, dbbase.ControllerHostTestCase):
         self.assertIn("retimer_included option is only applicable to"
                       " functional BMC image", str(result))
 
+    def test_create_functional_image_non_bmc_with_retimer(self):
+        # Test creation of device image
+        bitstream_file = os.path.join(os.path.dirname(__file__), "data",
+                                'bitstream.bit')
+        data = {
+            'bitstream_type': dconstants.BITSTREAM_TYPE_ROOT_KEY,
+            'pci_vendor': fpga_constants.N3000_VENDOR,
+            'pci_device': fpga_constants.N3000_DEVICE,
+            'key_signature': '12345',
+            'bmc': True,
+        }
+        upload_file = [('file', bitstream_file)]
+        result = self.post_with_files('/device_images', data,
+                                      upload_files=upload_file,
+                                      headers=self.API_HEADERS,
+                                      expect_errors=True)
+        self.assertIn("bmc option is only applicable to"
+                      " functional image", str(result))
+
     def test_create_bitstream_type_invalid(self):
         # Test creation of device image
         bitstream_file = os.path.join(os.path.dirname(__file__), "data",
@@ -362,6 +381,20 @@ class TestPatch(TestDeviceImage):
             pci_vendor='80ee',
             pci_device='beef',
             bitstream_id='6789')
+        self.device_image_bmc = dbutils.create_test_device_image(
+            bitstream_type=dconstants.BITSTREAM_TYPE_FUNCTIONAL,
+            pci_vendor='80ee',
+            pci_device='beef',
+            bitstream_id='0x2300011001030F',
+            bmc=True,
+            retimer_included=False)
+        self.device_image_bmc_retimer = dbutils.create_test_device_image(
+            bitstream_type=dconstants.BITSTREAM_TYPE_FUNCTIONAL,
+            pci_vendor='80ee',
+            pci_device='beef',
+            bitstream_id='0x2300011001030F',
+            bmc=True,
+            retimer_included=True)
 
     def test_device_image_apply_all_hosts(self):
         # Test applying device image to all hosts with fpga devices
@@ -459,6 +492,101 @@ class TestPatch(TestDeviceImage):
         self.assertEqual(response.content_type, 'application/json')
         self.assertEqual(response.status_code, http_client.OK)
 
+        # Verify that an entry of image to device mapping is updated
+        dev_img_state = self.dbapi.device_image_state_get_by_image_device(
+            self.device_image2.id, self.pci_device.id)
+        self.assertEqual(self.device_image2.id, dev_img_state.image_id)
+
+    def test_device_image_apply_functional_user_bmc(self):
+        # Test applying second device image with label
+
+        # Assign label to a device
+        self.post_json('/device_labels',
+                       [{'pcidevice_uuid': self.pci_device.uuid},
+                        {'key1': 'value1'}],
+                       headers=self.API_HEADERS)
+
+        # Apply the device user image
+        path = '/device_images/%s?action=apply' % self.device_image.uuid
+        response = self.patch_json(path, [{'key1': 'value1'}],
+                                   headers=self.API_HEADERS)
+        self.assertEqual(response.content_type, 'application/json')
+        self.assertEqual(response.status_code, http_client.OK)
+        # Verify that an entry of image to device mapping is updated
+        dev_img_state = self.dbapi.device_image_state_get_by_image_device(
+            self.device_image.id, self.pci_device.id)
+        self.assertEqual(dconstants.DEVICE_IMAGE_UPDATE_PENDING,
+                         dev_img_state.status)
+
+        # Test 1: Apply a functional BMC device image
+        path = '/device_images/%s?action=apply' % self.device_image_bmc.uuid
+        response = self.patch_json(path, [{'key1': 'value1'}],
+                                   headers=self.API_HEADERS,
+                                   expect_errors=True)
+        self.assertEqual(response.content_type, 'application/json')
+        self.assertEqual(response.status_code, http_client.OK)
+        # Verify that the entries for both images exist
+        dev_img_state = self.dbapi.device_image_state_get_by_image_device(
+            self.device_image.id, self.pci_device.id)
+        self.assertEqual(self.device_image.id, dev_img_state.image_id)
+        dev_img_state = self.dbapi.device_image_state_get_by_image_device(
+            self.device_image_bmc.id, self.pci_device.id)
+        self.assertEqual(self.device_image_bmc.id, dev_img_state.image_id)
+
+        # Test 2: Apply a functional BMC retimer device image
+        path = '/device_images/%s?action=apply' % self.device_image_bmc_retimer.uuid
+        response = self.patch_json(path, [{'key1': 'value1'}],
+                                   headers=self.API_HEADERS,
+                                   expect_errors=True)
+        self.assertEqual(response.content_type, 'application/json')
+        self.assertEqual(response.status_code, http_client.OK)
+        # Verify that the old bmc image is replaced with new bmc image with retimer
+        state_list = self.dbapi.device_image_state_get_list()
+        self.assertEqual(len(state_list), 2)
+        dev_img_state = self.dbapi.device_image_state_get_by_image_device(
+            self.device_image.id, self.pci_device.id)
+        self.assertEqual(self.device_image.id, dev_img_state.image_id)
+        dev_img_state = self.dbapi.device_image_state_get_by_image_device(
+            self.device_image_bmc_retimer.id, self.pci_device.id)
+        self.assertEqual(self.device_image_bmc_retimer.id, dev_img_state.image_id)
+
+        # Test 3: Apply a BMC image w/o retimer
+        path = '/device_images/%s?action=apply' % self.device_image_bmc.uuid
+        response = self.patch_json(path, [{'key1': 'value1'}],
+                                   headers=self.API_HEADERS,
+                                   expect_errors=True)
+        self.assertEqual(response.content_type, 'application/json')
+        self.assertEqual(response.status_code, http_client.OK)
+        # Verify that all three states exist, the old BMC retimer image state exists
+        state_list = self.dbapi.device_image_state_get_list()
+        self.assertEqual(len(state_list), 3)
+        dev_img_state = self.dbapi.device_image_state_get_by_image_device(
+            self.device_image.id, self.pci_device.id)
+        self.assertEqual(self.device_image.id, dev_img_state.image_id)
+        dev_img_state = self.dbapi.device_image_state_get_by_image_device(
+            self.device_image_bmc_retimer.id, self.pci_device.id)
+        self.assertEqual(self.device_image_bmc_retimer.id, dev_img_state.image_id)
+        dev_img_state = self.dbapi.device_image_state_get_by_image_device(
+            self.device_image_bmc.id, self.pci_device.id)
+        self.assertEqual(self.device_image_bmc.id, dev_img_state.image_id)
+
+        # Test 4: Apply a BMC image with retimer
+        path = '/device_images/%s?action=apply' % self.device_image_bmc_retimer.uuid
+        response = self.patch_json(path, [{'key1': 'value1'}],
+                                   headers=self.API_HEADERS,
+                                   expect_errors=True)
+        self.assertEqual(response.content_type, 'application/json')
+        self.assertEqual(response.status_code, http_client.OK)
+        # Verify that state for BMC image without retimer is deleted
+        state_list = self.dbapi.device_image_state_get_list()
+        self.assertEqual(len(state_list), 2)
+        dev_img_state = self.dbapi.device_image_state_get_by_image_device(
+            self.device_image.id, self.pci_device.id)
+        self.assertEqual(self.device_image.id, dev_img_state.image_id)
+        dev_img_state = self.dbapi.device_image_state_get_by_image_device(
+            self.device_image_bmc_retimer.id, self.pci_device.id)
+        self.assertEqual(self.device_image_bmc_retimer.id, dev_img_state.image_id)
+
     def test_device_image_remove_all_hosts(self):
         # Test removing device image for all hosts with fpga devices
         # Remove the device image
diff --git a/sysinv/sysinv/sysinv/sysinv/tests/db/utils.py b/sysinv/sysinv/sysinv/sysinv/tests/db/utils.py
index 9691689278..fec3ad7dd4 100644
--- a/sysinv/sysinv/sysinv/sysinv/tests/db/utils.py
+++ b/sysinv/sysinv/sysinv/sysinv/tests/db/utils.py
@@ -1609,6 +1609,8 @@ def get_test_device_image(**kw):
         'name': kw.get('name'),
         'description': kw.get('description'),
         'version': kw.get('version'),
+        'bmc': kw.get('bmc'),
+        'retimer_included': kw.get('retimer_included'),
     }
     return device_image