diff --git a/tools/releasetools/common.py b/tools/releasetools/common.py
index 1990377..8a8a613 100644
--- a/tools/releasetools/common.py
+++ b/tools/releasetools/common.py
@@ -480,6 +480,10 @@
     return self.get("virtual_ab_compression_method", "")
 
   @property
+  def vabc_cow_version(self):
+    return self.get("virtual_ab_cow_version", "")
+
+  @property
   def vendor_api_level(self):
     vendor_prop = self.info_dict.get("vendor.build.prop")
     if not vendor_prop:
diff --git a/tools/releasetools/ota_from_target_files.py b/tools/releasetools/ota_from_target_files.py
index dbbbca2..c0ff5d2 100755
--- a/tools/releasetools/ota_from_target_files.py
+++ b/tools/releasetools/ota_from_target_files.py
@@ -908,6 +908,16 @@
           source_info.vabc_compression_param, target_info.vabc_compression_param, source_info.vabc_compression_param))
       vabc_compression_param = source_info.vabc_compression_param
 
+    # Virtual AB Cow version 3 is introduced in Android U with improved memory
+    # and install time performance. All OTA's with
+    # both the source build and target build with VIRTUAL_AB_COW_VERSION = 3
+    # can support the new format. Otherwise, fallback on older versions
+    if not source_info.vabc_cow_version or not target_info.vabc_cow_version:
+      logger.info("Source or Target doesn't have VABC_COW_VERSION specified, default to version 2")
+      OPTIONS.vabc_cow_version = 2
+    elif source_info.vabc_cow_version != target_info.vabc_cow_version:
+      logger.info("Source and Target have different cow VABC_COW_VERSION specified, default to minimum version")
+      OPTIONS.vabc_cow_version = min(source_info.vabc_cow_version, target_info.vabc_cow_version)
     # Virtual AB Compression was introduced in Androd S.
     # Later, we backported VABC to Android R. But verity support was not
     # backported, so if VABC is used and we are on Android R, disable