diff --git a/pkg/bundler/kustomize_bundler.go b/pkg/bundler/kustomize_bundler.go
new file mode 100644
index 000000000..cd3bd0fa0
--- /dev/null
+++ b/pkg/bundler/kustomize_bundler.go
@@ -0,0 +1,74 @@
+package bundler
+
+import (
+	"fmt"
+	"os"
+	"path/filepath"
+)
+
+// The KustomizeBundler handles bundling of kustomize manifests and related files.
+// It copies all files from the kustomize directory to the artifact build directory.
+// The KustomizeBundler ensures that all kustomize resources are properly bundled
+// for distribution with the artifact for use with Flux OCIRegistry.
+
+// =============================================================================
+// Types
+// =============================================================================
+
+// KustomizeBundler handles bundling of kustomize files
+type KustomizeBundler struct {
+	BaseBundler
+}
+
+// =============================================================================
+// Constructor
+// =============================================================================
+
+// NewKustomizeBundler creates a new KustomizeBundler instance
+func NewKustomizeBundler() *KustomizeBundler {
+	return &KustomizeBundler{
+		BaseBundler: *NewBaseBundler(),
+	}
+}
+
+// =============================================================================
+// Public Methods
+// =============================================================================
+
+// Bundle adds all files from kustomize directory to the artifact by recursively walking the directory tree.
+// It validates that the kustomize directory exists, then walks through all files preserving the directory structure.
+// Each file is read and added to the artifact maintaining the original kustomize path structure.
+// Directories are skipped and only regular files are processed for bundling.
+func (k *KustomizeBundler) Bundle(artifact Artifact) error {
+	kustomizeSource := "kustomize"
+
+	if _, err := k.shims.Stat(kustomizeSource); os.IsNotExist(err) {
+		return fmt.Errorf("kustomize directory not found: %s", kustomizeSource)
+	}
+
+	return k.shims.Walk(kustomizeSource, func(path string, info os.FileInfo, err error) error {
+		if err != nil {
+			return err
+		}
+
+		if info.IsDir() {
+			return nil
+		}
+
+		relPath, err := k.shims.FilepathRel(kustomizeSource, path)
+		if err != nil {
+			return fmt.Errorf("failed to get relative path: %w", err)
+		}
+
+		data, err := k.shims.ReadFile(path)
+		if err != nil {
+			return fmt.Errorf("failed to read kustomize file %s: %w", path, err)
+		}
+
+		artifactPath := "kustomize/" + filepath.ToSlash(relPath)
+		return artifact.AddFile(artifactPath, data)
+	})
+}
+
+// Ensure KustomizeBundler implements Bundler interface
+var _ Bundler = (*KustomizeBundler)(nil)
diff --git a/pkg/bundler/kustomize_bundler_test.go b/pkg/bundler/kustomize_bundler_test.go
new file mode 100644
index 000000000..e52beb388
--- /dev/null
+++ b/pkg/bundler/kustomize_bundler_test.go
@@ -0,0 +1,354 @@
+package bundler
+
+import (
+	"fmt"
+	"os"
+	"path/filepath"
+	"testing"
+)
+
+// =============================================================================
+// Test KustomizeBundler
+// =============================================================================
+
+func TestKustomizeBundler_NewKustomizeBundler(t *testing.T) {
+	setup := func(t *testing.T) *KustomizeBundler {
+		t.Helper()
+		return NewKustomizeBundler()
+	}
+
+	t.Run("CreatesInstanceWithBaseBundler", func(t *testing.T) {
+		// Given no preconditions
+		// When creating a new kustomize bundler
+		bundler := setup(t)
+
+		// Then it should not be nil
+		if bundler == nil {
+			t.Fatal("Expected non-nil bundler")
+		}
+		// And it should have inherited BaseBundler properties
+		if bundler.shims == nil {
+			t.Error("Expected shims to be inherited from BaseBundler")
+		}
+		// And other fields should be nil until Initialize
+		if bundler.shell != nil {
+			t.Error("Expected shell to be nil before Initialize")
+		}
+		if bundler.injector != nil {
+			t.Error("Expected injector to be nil before Initialize")
+		}
+	})
+}
+
+func TestKustomizeBundler_Bundle(t *testing.T) {
+	setup := func(t *testing.T) (*KustomizeBundler, *BundlerMocks) {
+		t.Helper()
+		mocks := setupBundlerMocks(t)
+		bundler := NewKustomizeBundler()
+		bundler.shims = mocks.Shims
+		bundler.Initialize(mocks.Injector)
+		return bundler, mocks
+	}
+
+	t.Run("SuccessWithValidKustomizeFiles", func(t *testing.T) {
+		// Given a kustomize bundler with valid kustomize files
+		bundler, mocks := setup(t)
+
+		// Set up mocks to simulate finding kustomize files
+		filesAdded := make(map[string][]byte)
+		mocks.Artifact.AddFileFunc = func(path string, content []byte) error {
+			filesAdded[path] = content
+			return nil
+		}
+
+		bundler.shims.Walk = func(root string, fn filepath.WalkFunc) error {
+			// Simulate finding multiple files in kustomize directory
+			// Use filepath.Join to ensure cross-platform compatibility
+			fn(filepath.Join("kustomize", "kustomization.yaml"), &mockFileInfo{name: "kustomization.yaml", isDir: false}, nil)
+			fn(filepath.Join("kustomize", "deployment.yaml"), &mockFileInfo{name: "deployment.yaml", isDir: false}, nil)
+			fn(filepath.Join("kustomize", "base"), &mockFileInfo{name: "base", isDir: true}, nil)
+			fn(filepath.Join("kustomize", "base", "service.yaml"), &mockFileInfo{name: "service.yaml", isDir: false}, nil)
+			fn(filepath.Join("kustomize", "overlays"), &mockFileInfo{name: "overlays", isDir: true}, nil)
+			fn(filepath.Join("kustomize", "overlays", "prod"), &mockFileInfo{name: "prod", isDir: true}, nil)
+			fn(filepath.Join("kustomize", "overlays", "prod", "patch.yaml"), &mockFileInfo{name: "patch.yaml", isDir: false}, nil)
+			return nil
+		}
+
+		bundler.shims.FilepathRel = func(basepath, targpath string) (string, error) {
+			switch targpath {
+			case filepath.Join("kustomize", "kustomization.yaml"):
+				return "kustomization.yaml", nil
+			case filepath.Join("kustomize", "deployment.yaml"):
+				return "deployment.yaml", nil
+			case filepath.Join("kustomize", "base", "service.yaml"):
+				return filepath.Join("base", "service.yaml"), nil
+			case filepath.Join("kustomize", "overlays", "prod", "patch.yaml"):
+				return filepath.Join("overlays", "prod", "patch.yaml"), nil
+			default:
+				return "", fmt.Errorf("unexpected path: %s", targpath)
+			}
+		}
+
+		bundler.shims.ReadFile = func(filename string) ([]byte, error) {
+			switch filename {
+			case filepath.Join("kustomize", "kustomization.yaml"):
+				return []byte("apiVersion: kustomize.config.k8s.io/v1beta1\nkind: Kustomization"), nil
+			case filepath.Join("kustomize", "deployment.yaml"):
+				return []byte("apiVersion: apps/v1\nkind: Deployment"), nil
+			case filepath.Join("kustomize", "base", "service.yaml"):
+				return []byte("apiVersion: v1\nkind: Service"), nil
+			case filepath.Join("kustomize", "overlays", "prod", "patch.yaml"):
+				return []byte("- op: replace\n  path: /spec/replicas\n  value: 3"), nil
+			default:
+				return nil, fmt.Errorf("unexpected file: %s", filename)
+			}
+		}
+
+		// When calling Bundle
+		err := bundler.Bundle(mocks.Artifact)
+
+		// Then no error should be returned
+		if err != nil {
+			t.Errorf("Expected nil error, got %v", err)
+		}
+
+		// And files should be added with correct paths
+		expectedFiles := map[string]string{
+			"kustomize/kustomization.yaml":       "apiVersion: kustomize.config.k8s.io/v1beta1\nkind: Kustomization",
+			"kustomize/deployment.yaml":          "apiVersion: apps/v1\nkind: Deployment",
+			"kustomize/base/service.yaml":        "apiVersion: v1\nkind: Service",
+			"kustomize/overlays/prod/patch.yaml": "- op: replace\n  path: /spec/replicas\n  value: 3",
+		}
+
+		for expectedPath, expectedContent := range expectedFiles {
+			if content, exists := filesAdded[expectedPath]; !exists {
+				t.Errorf("Expected file %s to be added", expectedPath)
+			} else if string(content) != expectedContent {
+				t.Errorf("Expected content %q for %s, got %q", expectedContent, expectedPath, string(content))
+			}
+		}
+
+		// And directories should be skipped (only 4 files should be added)
+		if len(filesAdded) != 4 {
+			t.Errorf("Expected 4 files to be added, got %d", len(filesAdded))
+		}
+	})
+
+	t.Run("ErrorWhenKustomizeDirectoryNotFound", func(t *testing.T) {
+		// Given a kustomize bundler with missing kustomize directory
+		bundler, mocks := setup(t)
+		bundler.shims.Stat = func(name string) (os.FileInfo, error) {
+			if name == "kustomize" {
+				return nil, os.ErrNotExist
+			}
+			return &mockFileInfo{name: name, isDir: true}, nil
+		}
+
+		// When calling Bundle
+		err := bundler.Bundle(mocks.Artifact)
+
+		// Then an error should be returned
+		if err == nil {
+			t.Error("Expected error when kustomize directory not found")
+		}
+		expectedMsg := "kustomize directory not found: kustomize"
+		if err.Error() != expectedMsg {
+			t.Errorf("Expected error %q, got %q", expectedMsg, err.Error())
+		}
+	})
+
+	t.Run("ErrorWhenWalkFails", func(t *testing.T) {
+		// Given a kustomize bundler with failing filesystem walk
+		bundler, mocks := setup(t)
+		bundler.shims.Walk = func(root string, fn filepath.WalkFunc) error {
+			return fmt.Errorf("permission denied")
+		}
+
+		// When calling Bundle
+		err := bundler.Bundle(mocks.Artifact)
+
+		// Then the walk error should be returned
+		if err == nil {
+			t.Error("Expected error when walk fails")
+		}
+		if err.Error() != "permission denied" {
+			t.Errorf("Expected walk error, got: %v", err)
+		}
+	})
+
+	t.Run("ErrorWhenWalkCallbackFails", func(t *testing.T) {
+		// Given a kustomize bundler with walk callback returning error
+		bundler, mocks := setup(t)
+		bundler.shims.Walk = func(root string, fn filepath.WalkFunc) error {
+			// Simulate walk callback being called with an error
+			return fn(filepath.Join("kustomize", "test.yaml"), &mockFileInfo{name: "test.yaml", isDir: false}, fmt.Errorf("callback error"))
+		}
+
+		// When calling Bundle
+		err := bundler.Bundle(mocks.Artifact)
+
+		// Then the callback error should be returned
+		if err == nil {
+			t.Error("Expected error when walk callback fails")
+		}
+		if err.Error() != "callback error" {
+			t.Errorf("Expected callback error, got: %v", err)
+		}
+	})
+
+	t.Run("ErrorWhenFilepathRelFails", func(t *testing.T) {
+		// Given a kustomize bundler with failing relative path calculation
+		bundler, mocks := setup(t)
+		bundler.shims.Walk = func(root string, fn filepath.WalkFunc) error {
+			return fn(filepath.Join("kustomize", "test.yaml"), &mockFileInfo{name: "test.yaml", isDir: false}, nil)
+		}
+		bundler.shims.FilepathRel = func(basepath, targpath string) (string, error) {
+			return "", fmt.Errorf("relative path error")
+		}
+
+		// When calling Bundle
+		err := bundler.Bundle(mocks.Artifact)
+
+		// Then the relative path error should be returned
+		if err == nil {
+			t.Error("Expected error when filepath rel fails")
+		}
+		expectedMsg := "failed to get relative path: relative path error"
+		if err.Error() != expectedMsg {
+			t.Errorf("Expected error %q, got %q", expectedMsg, err.Error())
+		}
+	})
+
+	t.Run("ErrorWhenReadFileFails", func(t *testing.T) {
+		// Given a kustomize bundler with failing file read
+		bundler, mocks := setup(t)
+		bundler.shims.Walk = func(root string, fn filepath.WalkFunc) error {
+			return fn(filepath.Join("kustomize", "test.yaml"), &mockFileInfo{name: "test.yaml", isDir: false}, nil)
+		}
+		bundler.shims.FilepathRel = func(basepath, targpath string) (string, error) {
+			return "test.yaml", nil
+		}
+		bundler.shims.ReadFile = func(filename string) ([]byte, error) {
+			return nil, fmt.Errorf("read permission denied")
+		}
+
+		// When calling Bundle
+		err := bundler.Bundle(mocks.Artifact)
+
+		// Then the read error should be returned
+		if err == nil {
+			t.Error("Expected error when read file fails")
+		}
+		expectedMsg := "failed to read kustomize file " + filepath.Join("kustomize", "test.yaml") + ": read permission denied"
+		if err.Error() != expectedMsg {
+			t.Errorf("Expected error %q, got %q", expectedMsg, err.Error())
+		}
+	})
+
+	t.Run("ErrorWhenArtifactAddFileFails", func(t *testing.T) {
+		// Given a kustomize bundler with failing artifact add file
+		bundler, mocks := setup(t)
+		bundler.shims.Walk = func(root string, fn filepath.WalkFunc) error {
+			return fn(filepath.Join("kustomize", "test.yaml"), &mockFileInfo{name: "test.yaml", isDir: false}, nil)
+		}
+		bundler.shims.FilepathRel = func(basepath, targpath string) (string, error) {
+			return "test.yaml", nil
+		}
+		bundler.shims.ReadFile = func(filename string) ([]byte, error) {
+			return []byte("content"), nil
+		}
+		mocks.Artifact.AddFileFunc = func(path string, content []byte) error {
+			return fmt.Errorf("artifact storage full")
+		}
+
+		// When calling Bundle
+		err := bundler.Bundle(mocks.Artifact)
+
+		// Then the add file error should be returned
+		if err == nil {
+			t.Error("Expected error when artifact add file fails")
+		}
+		if err.Error() != "artifact storage full" {
+			t.Errorf("Expected add file error, got: %v", err)
+		}
+	})
+
+	t.Run("SkipsDirectoriesInWalk", func(t *testing.T) {
+		// Given a kustomize bundler with mix of files and directories
+		bundler, mocks := setup(t)
+
+		filesAdded := make([]string, 0)
+		mocks.Artifact.AddFileFunc = func(path string, content []byte) error {
+			filesAdded = append(filesAdded, path)
+			return nil
+		}
+
+		bundler.shims.Walk = func(root string, fn filepath.WalkFunc) error {
+			// Mix of directories and files
+			fn(filepath.Join("kustomize", "base"), &mockFileInfo{name: "base", isDir: true}, nil)
+			fn(filepath.Join("kustomize", "kustomization.yaml"), &mockFileInfo{name: "kustomization.yaml", isDir: false}, nil)
+			fn(filepath.Join("kustomize", "overlays"), &mockFileInfo{name: "overlays", isDir: true}, nil)
+			fn(filepath.Join("kustomize", "deployment.yaml"), &mockFileInfo{name: "deployment.yaml", isDir: false}, nil)
+			return nil
+		}
+
+		bundler.shims.FilepathRel = func(basepath, targpath string) (string, error) {
+			if targpath == filepath.Join("kustomize", "kustomization.yaml") {
+				return "kustomization.yaml", nil
+			}
+			if targpath == filepath.Join("kustomize", "deployment.yaml") {
+				return "deployment.yaml", nil
+			}
+			return "", nil
+		}
+
+		// When calling Bundle
+		err := bundler.Bundle(mocks.Artifact)
+
+		// Then no error should be returned
+		if err != nil {
+			t.Errorf("Expected nil error, got %v", err)
+		}
+
+		// And only files should be added (not directories)
+		expectedFiles := []string{"kustomize/kustomization.yaml", "kustomize/deployment.yaml"}
+		if len(filesAdded) != len(expectedFiles) {
+			t.Errorf("Expected %d files added, got %d", len(expectedFiles), len(filesAdded))
+		}
+
+		for i, expected := range expectedFiles {
+			if i < len(filesAdded) && filesAdded[i] != expected {
+				t.Errorf("Expected file %s at index %d, got %s", expected, i, filesAdded[i])
+			}
+		}
+	})
+
+	t.Run("HandlesEmptyKustomizeDirectory", func(t *testing.T) {
+		// Given a kustomize bundler with empty kustomize directory
+		bundler, mocks := setup(t)
+
+		filesAdded := make([]string, 0)
+		mocks.Artifact.AddFileFunc = func(path string, content []byte) error {
+			filesAdded = append(filesAdded, path)
+			return nil
+		}
+
+		bundler.shims.Walk = func(root string, fn filepath.WalkFunc) error {
+			// No files found in directory
+			return nil
+		}
+
+		// When calling Bundle
+		err := bundler.Bundle(mocks.Artifact)
+
+		// Then no error should be returned
+		if err != nil {
+			t.Errorf("Expected nil error, got %v", err)
+		}
+
+		// And no files should be added
+		if len(filesAdded) != 0 {
+			t.Errorf("Expected 0 files added, got %d", len(filesAdded))
+		}
+	})
+}