diff --git a/parts/agentparams.t b/parts/agentparams.t
index b31b47239d..6d9fb8827b 100644
--- a/parts/agentparams.t
+++ b/parts/agentparams.t
@@ -46,7 +46,7 @@
       "type": "string"
     }, 
     "{{.Name}}osImageVersion": {
-      "defaultValue": "16.04.201801120",
+      "defaultValue": "16.04.201801260",
       "metadata": {
         "description": "OS image version."
       },
diff --git a/parts/masterparams.t b/parts/masterparams.t
index 78dec107dd..07df8bd910 100644
--- a/parts/masterparams.t
+++ b/parts/masterparams.t
@@ -102,7 +102,7 @@
       "type": "string"
     }, 
     "osImageVersion": {
-      "defaultValue": "16.04.201801120",
+      "defaultValue": "16.04.201801260",
       "metadata": {
         "description": "OS image version."
       },
diff --git a/pkg/acsengine/defaults.go b/pkg/acsengine/defaults.go
index 0460f972c7..dc533fd1a1 100644
--- a/pkg/acsengine/defaults.go
+++ b/pkg/acsengine/defaults.go
@@ -54,7 +54,7 @@ var (
 		ImageOffer:     "UbuntuServer",
 		ImageSku:       "16.04-LTS",
 		ImagePublisher: "Canonical",
-		ImageVersion:   "16.04.201801120",
+		ImageVersion:   "16.04.201801260",
 	}
 
 	//DefaultRHELOSImageConfig is the RHEL Linux distribution.