diff --git a/resource_compute_image.go b/resource_compute_image.go
index 7aee8502..342d94f4 100644
--- a/resource_compute_image.go
+++ b/resource_compute_image.go
@@ -16,6 +16,8 @@ func resourceComputeImage() *schema.Resource {
 		Delete: resourceComputeImageDelete,
 
 		Schema: map[string]*schema.Schema{
+			// TODO(cblecker): one of source_disk or raw_disk is required
+
 			"name": &schema.Schema{
 				Type:     schema.TypeString,
 				Required: true,
@@ -39,9 +41,15 @@ func resourceComputeImage() *schema.Resource {
 				ForceNew: true,
 			},
 
+			"source_disk": &schema.Schema{
+				Type:     schema.TypeString,
+				Optional: true,
+				ForceNew: true,
+			},
+
 			"raw_disk": &schema.Schema{
 				Type:     schema.TypeList,
-				Required: true,
+				Optional: true,
 				ForceNew: true,
 				MaxItems: 1,
 				Elem: &schema.Resource{
@@ -95,15 +103,24 @@ func resourceComputeImageCreate(d *schema.ResourceData, meta interface{}) error
 		image.Family = v.(string)
 	}
 
-	rawDiskEle := d.Get("raw_disk").([]interface{})[0].(map[string]interface{})
-	imageRawDisk := &compute.ImageRawDisk{
-		Source:        rawDiskEle["source"].(string),
-		ContainerType: rawDiskEle["container_type"].(string),
+	// Load up the source_disk for this image if specified
+	if v, ok := d.GetOk("source_disk"); ok {
+		image.SourceDisk = v.(string)
 	}
-	if val, ok := rawDiskEle["sha1"]; ok {
-		imageRawDisk.Sha1Checksum = val.(string)
+
+	// Load up the raw_disk for this image if specified
+	if v, ok := d.GetOk("raw_disk"); ok {
+		rawDiskEle := v.([]interface{})[0].(map[string]interface{})
+		imageRawDisk := &compute.ImageRawDisk{
+			Source:        rawDiskEle["source"].(string),
+			ContainerType: rawDiskEle["container_type"].(string),
+		}
+		if val, ok := rawDiskEle["sha1"]; ok {
+			imageRawDisk.Sha1Checksum = val.(string)
+		}
+
+		image.RawDisk = imageRawDisk
 	}
-	image.RawDisk = imageRawDisk
 
 	// Insert the image
 	op, err := config.clientCompute.Images.Insert(
diff --git a/resource_compute_image_test.go b/resource_compute_image_test.go
index e5708c44..c4304793 100644
--- a/resource_compute_image_test.go
+++ b/resource_compute_image_test.go
@@ -29,6 +29,25 @@ func TestAccComputeImage_basic(t *testing.T) {
 	})
 }
 
+func TestAccComputeImage_basedondisk(t *testing.T) {
+	var image compute.Image
+
+	resource.Test(t, resource.TestCase{
+		PreCheck:     func() { testAccPreCheck(t) },
+		Providers:    testAccProviders,
+		CheckDestroy: testAccCheckComputeImageDestroy,
+		Steps: []resource.TestStep{
+			resource.TestStep{
+				Config: testAccComputeImage_basedondisk,
+				Check: resource.ComposeTestCheckFunc(
+					testAccCheckComputeImageExists(
+						"google_compute_image.foobar", &image),
+				),
+			},
+		},
+	})
+}
+
 func testAccCheckComputeImageDestroy(s *terraform.State) error {
 	config := testAccProvider.Meta().(*Config)
 
@@ -83,3 +102,14 @@ resource "google_compute_image" "foobar" {
 	  source = "https://storage.googleapis.com/bosh-cpi-artifacts/bosh-stemcell-3262.4-google-kvm-ubuntu-trusty-go_agent-raw.tar.gz"
 	}
 }`, acctest.RandString(10))
+
+var testAccComputeImage_basedondisk = fmt.Sprintf(`
+resource "google_compute_disk" "foobar" {
+	name = "disk-test-%s"
+	zone = "us-central1-a"
+	image = "debian-8-jessie-v20160803"
+}
+resource "google_compute_image" "foobar" {
+	name = "image-test-%s"
+	source_disk = "${google_compute_disk.foobar.self_link}"
+}`, acctest.RandString(10), acctest.RandString(10))