diff --git a/virtweb_backend/src/constants.rs b/virtweb_backend/src/constants.rs
index 214ad6b..1822d6d 100644
--- a/virtweb_backend/src/constants.rs
+++ b/virtweb_backend/src/constants.rs
@@ -137,6 +137,9 @@ pub const PROGRAM_COPY: &str = "/bin/cp";
 /// Gzip program path
 pub const PROGRAM_GZIP: &str = "/usr/bin/gzip";
 
+/// XZ program path
+pub const PROGRAM_XZ: &str = "/usr/bin/xz";
+
 /// Bash program
 pub const PROGRAM_BASH: &str = "/usr/bin/bash";
 
diff --git a/virtweb_backend/src/utils/file_disks_utils.rs b/virtweb_backend/src/utils/file_disks_utils.rs
index db1d40f..012f894 100644
--- a/virtweb_backend/src/utils/file_disks_utils.rs
+++ b/virtweb_backend/src/utils/file_disks_utils.rs
@@ -28,8 +28,10 @@ pub enum DiskFileFormat {
         #[serde(default)]
         virtual_size: FileSize,
     },
-    CompressedRaw,
-    CompressedQCow2,
+    GzCompressedRaw,
+    GzCompressedQCow2,
+    XzCompressedRaw,
+    XzCompressedQCow2,
 }
 
 impl DiskFileFormat {
@@ -37,8 +39,10 @@ impl DiskFileFormat {
         match self {
             DiskFileFormat::Raw { .. } => &["raw", ""],
             DiskFileFormat::QCow2 { .. } => &["qcow2"],
-            DiskFileFormat::CompressedRaw => &["raw.gz"],
-            DiskFileFormat::CompressedQCow2 => &["qcow2.gz"],
+            DiskFileFormat::GzCompressedRaw => &["raw.gz"],
+            DiskFileFormat::GzCompressedQCow2 => &["qcow2.gz"],
+            DiskFileFormat::XzCompressedRaw => &["raw.xz"],
+            DiskFileFormat::XzCompressedQCow2 => &["qcow2.xz"],
         }
     }
 }
@@ -81,9 +85,14 @@ impl DiskFileInfo {
             },
             "gz" if name.ends_with(".qcow2") => {
                 name = name.strip_suffix(".qcow2").unwrap_or(&name).to_string();
-                DiskFileFormat::CompressedQCow2
+                DiskFileFormat::GzCompressedQCow2
             }
-            "gz" => DiskFileFormat::CompressedRaw,
+            "gz" => DiskFileFormat::GzCompressedRaw,
+            "xz" if name.ends_with(".qcow2") => {
+                name = name.strip_suffix(".qcow2").unwrap_or(&name).to_string();
+                DiskFileFormat::XzCompressedQCow2
+            }
+            "xz" => DiskFileFormat::XzCompressedRaw,
             _ => anyhow::bail!("Unsupported disk extension: {ext}!"),
         };
 
@@ -159,8 +168,8 @@ impl DiskFileInfo {
 
         // Prepare the conversion
         let mut cmd = match (self.format, dest_format) {
-            // Decompress QCow2
-            (DiskFileFormat::CompressedQCow2, DiskFileFormat::QCow2 { .. }) => {
+            // Decompress QCow2 (GZIP)
+            (DiskFileFormat::GzCompressedQCow2, DiskFileFormat::QCow2 { .. }) => {
                 let mut cmd = Command::new(constants::PROGRAM_GZIP);
                 cmd.arg("--keep")
                     .arg("--decompress")
@@ -170,8 +179,19 @@ impl DiskFileInfo {
                 cmd
             }
 
-            // Compress QCow2
-            (DiskFileFormat::QCow2 { .. }, DiskFileFormat::CompressedQCow2) => {
+            // Decompress QCow2 (XZ)
+            (DiskFileFormat::XzCompressedQCow2, DiskFileFormat::QCow2 { .. }) => {
+                let mut cmd = Command::new(constants::PROGRAM_XZ);
+                cmd.arg("--stdout")
+                    .arg("--keep")
+                    .arg("--decompress")
+                    .arg(&self.file_path)
+                    .stdout(File::create(&temp_file)?);
+                cmd
+            }
+
+            // Compress QCow2 (Gzip)
+            (DiskFileFormat::QCow2 { .. }, DiskFileFormat::GzCompressedQCow2) => {
                 let mut cmd = Command::new(constants::PROGRAM_GZIP);
                 cmd.arg("--keep")
                     .arg("--to-stdout")
@@ -180,6 +200,16 @@ impl DiskFileInfo {
                 cmd
             }
 
+            // Compress QCow2 (Xz)
+            (DiskFileFormat::QCow2 { .. }, DiskFileFormat::XzCompressedQCow2) => {
+                let mut cmd = Command::new(constants::PROGRAM_XZ);
+                cmd.arg("--keep")
+                    .arg("--to-stdout")
+                    .arg(&self.file_path)
+                    .stdout(File::create(&temp_file)?);
+                cmd
+            }
+
             // Convert QCow2 to Raw file
             (DiskFileFormat::QCow2 { .. }, DiskFileFormat::Raw { is_sparse }) => {
                 let mut cmd = Command::new(constants::PROGRAM_QEMU_IMAGE);
@@ -245,7 +275,7 @@ impl DiskFileInfo {
             }
 
             // Compress Raw
-            (DiskFileFormat::Raw { .. }, DiskFileFormat::CompressedRaw) => {
+            (DiskFileFormat::Raw { .. }, DiskFileFormat::GzCompressedRaw) => {
                 let mut cmd = Command::new(constants::PROGRAM_GZIP);
                 cmd.arg("--keep")
                     .arg("--to-stdout")
@@ -255,7 +285,7 @@ impl DiskFileInfo {
             }
 
             // Decompress Raw to not sparse file
-            (DiskFileFormat::CompressedRaw, DiskFileFormat::Raw { is_sparse: false }) => {
+            (DiskFileFormat::GzCompressedRaw, DiskFileFormat::Raw { is_sparse: false }) => {
                 let mut cmd = Command::new(constants::PROGRAM_GZIP);
                 cmd.arg("--keep")
                     .arg("--decompress")
@@ -267,7 +297,7 @@ impl DiskFileInfo {
 
             // Decompress Raw to sparse file
             // https://benou.fr/www/ben/decompressing-sparse-files.html
-            (DiskFileFormat::CompressedRaw, DiskFileFormat::Raw { is_sparse: true }) => {
+            (DiskFileFormat::GzCompressedRaw, DiskFileFormat::Raw { is_sparse: true }) => {
                 let mut cmd = Command::new(constants::PROGRAM_BASH);
                 cmd.arg("-c").arg(format!(
                     "{} -d -c {} | {} conv=sparse of={}",
diff --git a/virtweb_frontend/src/api/DiskImageApi.ts b/virtweb_frontend/src/api/DiskImageApi.ts
index 3db7bbe..bcca6c4 100644
--- a/virtweb_frontend/src/api/DiskImageApi.ts
+++ b/virtweb_frontend/src/api/DiskImageApi.ts
@@ -4,8 +4,8 @@ import { VMFileDisk, VMInfo } from "./VMApi";
 export type DiskImageFormat =
   | { format: "Raw"; is_sparse: boolean }
   | { format: "QCow2"; virtual_size?: number }
-  | { format: "CompressedQCow2" }
-  | { format: "CompressedRaw" };
+  | { format: "GzCompressedQCow2" }
+  | { format: "GzCompressedRaw" };
 
 export type DiskImage = {
   file_size: number;
diff --git a/virtweb_frontend/src/dialogs/ConvertDiskImageDialog.tsx b/virtweb_frontend/src/dialogs/ConvertDiskImageDialog.tsx
index f64e229..830d8b3 100644
--- a/virtweb_frontend/src/dialogs/ConvertDiskImageDialog.tsx
+++ b/virtweb_frontend/src/dialogs/ConvertDiskImageDialog.tsx
@@ -42,13 +42,15 @@ export function ConvertDiskImageDialog(
     setFormat({ format: value ?? ("QCow2" as any) });
 
     if (value === "QCow2") setFilename(`${origFilename}.qcow2`);
-    if (value === "CompressedQCow2") setFilename(`${origFilename}.qcow2.gz`);
+    if (value === "GzCompressedQCow2") setFilename(`${origFilename}.qcow2.gz`);
+    if (value === "XzCompressedQCow2") setFilename(`${origFilename}.qcow2.xz`);
     if (value === "Raw") {
       setFilename(`${origFilename}.raw`);
       // Check sparse checkbox by default
       setFormat({ format: "Raw", is_sparse: true });
     }
-    if (value === "CompressedRaw") setFilename(`${origFilename}.raw.gz`);
+    if (value === "GzCompressedRaw") setFilename(`${origFilename}.raw.gz`);
+    if (value === "XzCompressedRaw") setFilename(`${origFilename}.raw.xz`);
   };
 
   const handleSubmit = async () => {
@@ -104,8 +106,10 @@ export function ConvertDiskImageDialog(
           options={[
             { value: "QCow2" },
             { value: "Raw" },
-            { value: "CompressedRaw" },
-            { value: "CompressedQCow2" },
+            { value: "GzCompressedRaw" },
+            { value: "XzCompressedRaw" },
+            { value: "GzCompressedQCow2" },
+            { value: "XzCompressedQCow2" },
           ]}
         />