diff --git a/.github/actions/spelling/expect.txt b/.github/actions/spelling/expect.txt
index a683b5bbdb7..89eef1bbcc3 100644
--- a/.github/actions/spelling/expect.txt
+++ b/.github/actions/spelling/expect.txt
@@ -684,6 +684,7 @@ sharkanodo
 shasta
 shazbat
 shortkey
+shortlived
 showmuted
 sigch
 sigevent
diff --git a/bats/tests/containers/factory-reset-snapshots.bats b/bats/tests/containers/factory-reset-snapshots.bats
new file mode 100644
index 00000000000..e1bc294bea1
--- /dev/null
+++ b/bats/tests/containers/factory-reset-snapshots.bats
@@ -0,0 +1,29 @@
+load '../helpers/load'
+
+@test 'factory reset' {
+    delete_all_snapshots
+    factory_reset
+}
+
+@test 'Start up Rancher Desktop with a snapshots subdirectory' {
+    start_container_engine
+    wait_for_container_engine
+    wait_for_backend
+}
+
+@test "Verify the snapshot dir isn't deleted on factory-reset" {
+    rdctl shutdown
+    rdctl snapshot create shortlived-snapshot
+    rdctl factory-reset
+    assert_not_exists "$PATH_APP_HOME/rd-engine.json"
+    assert_exists "$PATH_SNAPSHOTS"
+    run ls -A "$PATH_SNAPSHOTS"
+    assert_output
+    test -n "$output"
+}
+
+@test 'Verify factory-reset deletes an empty snapshots directory' {
+    rdctl snapshot delete shortlived-snapshot
+    rdctl factory-reset
+    assert_not_exists "$PATH_APP_HOME"
+}