diff --git a/builder/azure/chroot/builder.go b/builder/azure/chroot/builder.go
index b2ac901f9..abc75d677 100644
--- a/builder/azure/chroot/builder.go
+++ b/builder/azure/chroot/builder.go
@@ -5,6 +5,7 @@ import (
 	"errors"
 	"fmt"
 	"github.com/Azure/go-autorest/autorest/azure"
+	"github.com/Azure/go-autorest/autorest/to"
 	"log"
 	"runtime"
 	"strings"
@@ -26,7 +27,8 @@ type Config struct {
 
 	ClientConfig client.Config `mapstructure:",squash"`
 
-	FromScratch bool `mapstructure:"from_scratch"`
+	FromScratch bool   `mapstructure:"from_scratch"`
+	Source      string `mapstructure:"source"`
 
 	CommandWrapper    string     `mapstructure:"command_wrapper"`
 	PreMountCommands  []string   `mapstructure:"pre_mount_commands"`
@@ -75,6 +77,9 @@ func (b *Builder) Prepare(raws ...interface{}) ([]string, error) {
 		},
 	}, raws...)
 
+	var errs *packer.MultiError
+	var warns []string
+
 	// Defaults
 	err = b.config.ClientConfig.SetDefaultValues()
 	if err != nil {
@@ -115,7 +120,12 @@ func (b *Builder) Prepare(raws ...interface{}) ([]string, error) {
 	}
 
 	if b.config.TemporaryOSDiskName == "" {
-		b.config.TemporaryOSDiskName = "PackerTemp-{{timestamp}}"
+
+		if def, err := interpolate.Render("PackerTemp-{{timestamp}}", &b.config.ctx); err == nil {
+			b.config.TemporaryOSDiskName = def
+		} else {
+			errs = packer.MultiErrorAppend(errs, fmt.Errorf("unable to render temporary disk name: %s", err))
+		}
 	}
 
 	if b.config.OSDiskStorageAccountType == "" {
@@ -135,10 +145,12 @@ func (b *Builder) Prepare(raws ...interface{}) ([]string, error) {
 	}
 
 	// checks, accumulate any errors or warnings
-	var errs *packer.MultiError
-	var warns []string
 
 	if b.config.FromScratch {
+		if b.config.Source != "" {
+			errs = packer.MultiErrorAppend(
+				errs, errors.New("source cannot be specified when building from_scratch"))
+		}
 		if b.config.OSDiskSizeGB == 0 {
 			errs = packer.MultiErrorAppend(
 				errs, errors.New("os_disk_size_gb is required with from_scratch"))
@@ -148,7 +160,12 @@ func (b *Builder) Prepare(raws ...interface{}) ([]string, error) {
 				errs, errors.New("pre_mount_commands is required with from_scratch"))
 		}
 	} else {
-		errs = packer.MultiErrorAppend(errors.New("only 'from_scratch'=true is supported right now"))
+		if _, err := client.ParsePlatformImageURN(b.config.Source); err == nil {
+			log.Println("Source is platform image:", b.config.Source)
+		} else {
+			errs = packer.MultiErrorAppend(
+				errs, fmt.Errorf("source: %q is not a valid platform image specifier", b.config.Source))
+		}
 	}
 
 	if err := checkDiskCacheType(b.config.OSDiskCacheType); err != nil {
@@ -271,10 +288,7 @@ func (b *Builder) Run(ctx context.Context, ui packer.Ui, hook packer.Hook) (pack
 	// Build the steps
 	var steps []multistep.Step
 
-	if !b.config.FromScratch {
-		panic("Only from_scratch is currently implemented")
-		// create disk from PIR / managed image (warn on non-linux images)
-	} else {
+	if b.config.FromScratch {
 		steps = append(steps,
 			&StepCreateNewDisk{
 				SubscriptionID:         info.SubscriptionID,
@@ -285,6 +299,31 @@ func (b *Builder) Run(ctx context.Context, ui packer.Ui, hook packer.Hook) (pack
 				HyperVGeneration:       b.config.ImageHyperVGeneration,
 				Location:               info.Location,
 			})
+	} else {
+		if pi, err := client.ParsePlatformImageURN(b.config.Source); err == nil {
+			if strings.EqualFold(pi.Version, "latest") {
+
+				vmi, err := azcli.VirtualMachineImagesClient().GetLatest(ctx, pi.Publisher, pi.Offer, pi.Sku, info.Location)
+				if err != nil {
+					return nil, fmt.Errorf("error retieving latest version of %q: %v", b.config.Source, err)
+				}
+				pi.Version = to.String(vmi.Name)
+				log.Println("Resolved latest version of source image:", pi.Version)
+			}
+			steps = append(steps,
+				&StepCreateNewDisk{
+					SubscriptionID:         info.SubscriptionID,
+					ResourceGroup:          info.ResourceGroupName,
+					DiskName:               b.config.TemporaryOSDiskName,
+					DiskSizeGB:             b.config.OSDiskSizeGB,
+					DiskStorageAccountType: b.config.OSDiskStorageAccountType,
+					HyperVGeneration:       b.config.ImageHyperVGeneration,
+					Location:               info.Location,
+					PlatformImage:          pi,
+				})
+		} else {
+			panic("Unknown image source: " + b.config.Source)
+		}
 	}
 
 	steps = append(steps,
diff --git a/builder/azure/chroot/step_create_image.go b/builder/azure/chroot/step_create_image.go
index bd869470c..4ae90d2fe 100644
--- a/builder/azure/chroot/step_create_image.go
+++ b/builder/azure/chroot/step_create_image.go
@@ -51,9 +51,12 @@ func (s *StepCreateImage) Run(ctx context.Context, state multistep.StateBag) mul
 			StorageProfile: &compute.ImageStorageProfile{
 				OsDisk: &compute.ImageOSDisk{
 					OsState: compute.OperatingSystemStateTypes(s.ImageOSState),
+					OsType:  compute.Linux,
 					ManagedDisk: &compute.SubResource{
 						ID: &diskResourceID,
 					},
+					StorageAccountType: compute.StorageAccountTypes(s.OSDiskStorageAccountType),
+					Caching:            compute.CachingTypes(s.OSDiskCacheType),
 				},
 				//	DataDisks:     nil,
 				//	ZoneResilient: nil,
diff --git a/builder/azure/chroot/step_create_new_disk.go b/builder/azure/chroot/step_create_new_disk.go
index 8187bb7dc..6873c827a 100644
--- a/builder/azure/chroot/step_create_new_disk.go
+++ b/builder/azure/chroot/step_create_new_disk.go
@@ -20,6 +20,7 @@ type StepCreateNewDisk struct {
 	DiskStorageAccountType                  string // from compute.DiskStorageAccountTypes
 	HyperVGeneration                        string
 	Location                                string
+	PlatformImage                           *client.PlatformImage
 }
 
 func (s StepCreateNewDisk) Run(ctx context.Context, state multistep.StateBag) multistep.StepAction {
@@ -42,10 +43,8 @@ func (s StepCreateNewDisk) Run(ctx context.Context, state multistep.StateBag) mu
 		DiskProperties: &compute.DiskProperties{
 			OsType:           "Linux",
 			HyperVGeneration: compute.HyperVGeneration(s.HyperVGeneration),
-			CreationData: &compute.CreationData{
-				CreateOption: compute.Empty,
-			},
-			DiskSizeGB: to.Int32Ptr(s.DiskSizeGB),
+			CreationData:     &compute.CreationData{},
+			DiskSizeGB:       to.Int32Ptr(s.DiskSizeGB),
 		},
 		//Tags: map[string]*string{
 	}
@@ -54,6 +53,17 @@ func (s StepCreateNewDisk) Run(ctx context.Context, state multistep.StateBag) mu
 		disk.DiskProperties.DiskSizeGB = to.Int32Ptr(s.DiskSizeGB)
 	}
 
+	if s.PlatformImage == nil {
+		disk.CreationData.CreateOption = compute.Empty
+	} else {
+		disk.CreationData.CreateOption = compute.FromImage
+		disk.CreationData.ImageReference = &compute.ImageDiskReference{
+			ID: to.StringPtr(fmt.Sprintf(
+				"/subscriptions/%s/providers/Microsoft.Compute/locations/%s/publishers/%s/artifacttypes/vmimage/offers/%s/skus/%s/versions/%s",
+				s.SubscriptionID, s.Location, s.PlatformImage.Publisher, s.PlatformImage.Offer, s.PlatformImage.Sku, s.PlatformImage.Version)),
+		}
+	}
+
 	f, err := azcli.DisksClient().CreateOrUpdate(ctx, s.ResourceGroup, s.DiskName, disk)
 	if err == nil {
 		err = f.WaitForCompletionRef(ctx, azcli.PollClient())