diff --git a/sky/provision/docker_utils.py b/sky/provision/docker_utils.py
index 303032128e3..b5394cd560c 100644
--- a/sky/provision/docker_utils.py
+++ b/sky/provision/docker_utils.py
@@ -94,6 +94,10 @@ def docker_start_cmds(
         env_flags,
         user_options_str,
         '--net=host',
+        # SkyPilot: Add following options to enable fuse.
+        '--cap-add=SYS_ADMIN',
+        '--device=/dev/fuse',
+        '--security-opt=apparmor:unconfined',
         image,
         'bash',
     ]
@@ -246,8 +250,12 @@ def initialize(self) -> str:
             run_env='docker')
         # Install dependencies.
         self._run(
-            'sudo apt-get update; sudo apt-get install -y rsync curl wget '
-            'patch openssh-server python3-pip;',
+            'sudo apt-get update; '
+            # Our mount script will install gcsfuse without fuse package.
+            # We need to install fuse package first to enable storage mount.
+            # The dpkg option is to suppress the prompt for fuse installation.
+            'sudo apt-get -o DPkg::Options::="--force-confnew" install -y '
+            'rsync curl wget patch openssh-server python3-pip fuse;',
             run_env='docker')
 
         # Copy local authorized_keys to docker container.
diff --git a/tests/test_smoke.py b/tests/test_smoke.py
index 8c85356a4e8..340de5cf842 100644
--- a/tests/test_smoke.py
+++ b/tests/test_smoke.py
@@ -77,7 +77,7 @@
     'touch ~/tmpfile', 'mkdir -p ~/tmp-workdir',
     'touch ~/tmp-workdir/tmp\ file', 'touch ~/tmp-workdir/tmp\ file2',
     'touch ~/tmp-workdir/foo',
-    'ln -f -s ~/tmp-workdir/ ~/tmp-workdir/circle-link',
+    '[ ! -e ~/tmp-workdir/circle-link ] && ln -s ~/tmp-workdir/ ~/tmp-workdir/circle-link || true',
     'touch ~/.ssh/id_rsa.pub'
 ]
 
@@ -970,6 +970,43 @@ def test_kubernetes_storage_mounts():
         run_one_test(test)
 
 
+@pytest.mark.parametrize(
+    "image_id",
+    [
+        "docker:nvidia/cuda:11.8.0-devel-ubuntu18.04",
+        "docker:ubuntu:18.04",
+        # Test image with python 3.11 installed by default.
+        "docker:continuumio/miniconda3",
+    ])
+def test_docker_storage_mounts(generic_cloud: str, image_id: str):
+    # Tests bucket mounting on docker container
+    name = _get_cluster_name()
+    timestamp = str(time.time()).replace('.', '')
+    storage_name = f'sky-test-{timestamp}'
+    template_str = pathlib.Path(
+        'tests/test_yamls/test_storage_mounting.yaml.j2').read_text()
+    template = jinja2.Template(template_str)
+    content = template.render(storage_name=storage_name)
+    with tempfile.NamedTemporaryFile(suffix='.yaml', mode='w') as f:
+        f.write(content)
+        f.flush()
+        file_path = f.name
+        test_commands = [
+            *storage_setup_commands,
+            f'sky launch -y -c {name} --cloud {generic_cloud} --image-id {image_id} {file_path}',
+            f'sky logs {name} 1 --status',  # Ensure job succeeded.
+            f'aws s3 ls {storage_name}/hello.txt || '
+            f'gsutil ls gs://{storage_name}/hello.txt',
+        ]
+        test = Test(
+            'docker_storage_mounts',
+            test_commands,
+            f'sky down -y {name}; sky storage delete -y {storage_name}',
+            timeout=20 * 60,  # 20 mins
+        )
+        run_one_test(test)
+
+
 @pytest.mark.cloudflare
 def test_cloudflare_storage_mounts(generic_cloud: str):
     name = _get_cluster_name()