diff --git a/README.md b/README.md
index 5cba434..3895fd1 100644
--- a/README.md
+++ b/README.md
@@ -7,3 +7,50 @@ Focker is a FreeBSD image orchestration tool in the vein of Docker.
 ## Installation
 
 In order to use Focker you need a ZFS pool available in your FreeBSD installation.
+
+### Installing the Python package
+
+Run:
+
+```bash
+git clone https://github.com/sadaszewski/focker.git
+cd focker/
+python setup.py install
+```
+
+or (if you want an uninstaller):
+
+```bash
+git clone https://github.com/sadaszewski/focker.git
+cd focker/
+python setup.py sdist
+pip install dist/focker-0.9.tgz
+```
+
+### Setting up ZFS
+
+Upon first execution of the `focker` command, Focker will automatically create the necessary directories and ZFS datasets. You just need to exclude the unlikely case that you are already using /focker in your filesystem hierarchy. The layout after initialization will look the following:
+
+```
+/focker
+/focker/images
+/focker/jails
+/focker/volumes
+```
+
+`images`, `jails`, and `volumes` have corresponding ZFS datasets with `canmount=off` so that they serve as mountpoint anchors for child entries.
+
+### Preparing base image
+
+To bootstrap the images system you need to install FreeBSD in jail mode to a ZFS dataset placed in /focker/images and provide two user-defined properties - `focker:sha256` and `focker:tags`. One way to achieve this would be the following:
+
+```bash
+TAGS="freebsd-latest freebsd-$(freebsd-version | cut -d'-' -f1)"
+VERSION="FreeBSD $(freebsd-version)"
+SHA256=$(echo -n ${VERSION} | sha256)
+NAME=${SHA256:0:7}
+zfs create -o focker:sha256=${SHA256} -o focker:tags="${TAGS}" zroot/focker/images/${NAME}
+bsdinstall jail /focker/images/${NAME}
+zfs set readonly=on zroot/focker/images/${NAME}
+zfs snapshot zroot/focker/images/${NAME}@1
+```