diff --git a/CHANGELOG.md b/CHANGELOG.md
index 6ec545e8..1d9e71f5 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -44,6 +44,10 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 - Set correct overlay permissions for a NetworkManager configuration
   file. #591
 
+### Fixed
+
+- Directories within overlays no longer lose group/other write permissions #584
+
 ## [4.4.0rc2] 2022-12-09
 
 ### Added
diff --git a/internal/pkg/overlay/overlay.go b/internal/pkg/overlay/overlay.go
index 06ddc1fa..66443f93 100644
--- a/internal/pkg/overlay/overlay.go
+++ b/internal/pkg/overlay/overlay.go
@@ -11,6 +11,7 @@ import (
 	"path/filepath"
 	"regexp"
 	"strings"
+	"syscall"
 	"text/template"
 
 	"github.com/hpcng/warewulf/internal/pkg/node"
@@ -197,6 +198,9 @@ func BuildOverlayIndir(nodeInfo node.NodeInfo, overlayNames []string, outputDir
 		return errors.Errorf("overlay names contains illegal characters: %v", overlayNames)
 	}
 
+	// Temporarily set umask to 0000, so directories in the overlay retain permissions
+	defer syscall.Umask(syscall.Umask(0))
+
 	wwlog.Verbose("Processing node/overlay: %s/%s", nodeInfo.Id.Get(), strings.Join(overlayNames, "-"))
 	for _, overlayName := range overlayNames {
 		wwlog.Verbose("Building overlay %s for node %s in %s", overlayName, nodeInfo.Id.Get(), outputDir)