diff --git a/api/v1beta1/condition_consts.go b/api/v1beta1/condition_consts.go
index 7b1a5483b7b4..ff798aa3ef0e 100644
--- a/api/v1beta1/condition_consts.go
+++ b/api/v1beta1/condition_consts.go
@@ -228,6 +228,14 @@ const (
 	// machines required (i.e. Spec.Replicas-MaxUnavailable when MachineDeploymentStrategyType = RollingUpdate) are up and running for at least minReadySeconds.
 	MachineDeploymentAvailableCondition ConditionType = "Available"
 
+	// MachineSetReadyCondition reports a summary of current status of the MachineSet owned by the MachineDeployment.
+	MachineSetReadyCondition ConditionType = "MachineSetReady"
+
+	// WaitingForMachineSetFallbackReason (Severity=Info) documents a MachineDeployment waiting for the underlying MachineSet
+	// to be available.
+	// NOTE: This reason is used only as a fallback when the MachineSet object is not reporting its own ready condition.
+	WaitingForMachineSetFallbackReason = "WaitingForMachineSet"
+
 	// WaitingForAvailableMachinesReason (Severity=Warning) reflects the fact that the required minimum number of machines for a machinedeployment are not available.
 	WaitingForAvailableMachinesReason = "WaitingForAvailableMachines"
 )
diff --git a/internal/controllers/machinedeployment/machinedeployment_sync.go b/internal/controllers/machinedeployment/machinedeployment_sync.go
index 546ecd85f86f..af0ac4cbd1b8 100644
--- a/internal/controllers/machinedeployment/machinedeployment_sync.go
+++ b/internal/controllers/machinedeployment/machinedeployment_sync.go
@@ -499,6 +499,17 @@ func (r *Reconciler) syncDeploymentStatus(allMSs []*clusterv1.MachineSet, newMS
 	} else {
 		conditions.MarkFalse(md, clusterv1.MachineDeploymentAvailableCondition, clusterv1.WaitingForAvailableMachinesReason, clusterv1.ConditionSeverityWarning, "Minimum availability requires %d replicas, current %d available", minReplicasNeeded, md.Status.AvailableReplicas)
 	}
+
+	if newMS != nil {
+		// Report a summary of current status of the MachineSet object owned by this MachineDeployment.
+		conditions.SetMirror(md, clusterv1.MachineSetReadyCondition,
+			newMS,
+			conditions.WithFallbackValue(false, clusterv1.WaitingForMachineSetFallbackReason, clusterv1.ConditionSeverityInfo, ""),
+		)
+	} else {
+		conditions.MarkFalse(md, clusterv1.MachineSetReadyCondition, clusterv1.WaitingForMachineSetFallbackReason, clusterv1.ConditionSeverityInfo, "MachineSet not found")
+	}
+
 	return nil
 }
 
diff --git a/internal/controllers/machinedeployment/machinedeployment_sync_test.go b/internal/controllers/machinedeployment/machinedeployment_sync_test.go
index 0367d3d0cbe0..82472e72b0c1 100644
--- a/internal/controllers/machinedeployment/machinedeployment_sync_test.go
+++ b/internal/controllers/machinedeployment/machinedeployment_sync_test.go
@@ -430,7 +430,7 @@ func newTestMachineDeployment(pds *int32, replicas, statusReplicas, updatedRepli
 }
 
 // helper to create MS with given availableReplicas.
-func newTestMachinesetWithReplicas(name string, specReplicas, statusReplicas, availableReplicas int32) *clusterv1.MachineSet {
+func newTestMachinesetWithReplicas(name string, specReplicas, statusReplicas, availableReplicas int32, conditions clusterv1.Conditions) *clusterv1.MachineSet {
 	return &clusterv1.MachineSet{
 		ObjectMeta: metav1.ObjectMeta{
 			Name:              name,
@@ -443,6 +443,7 @@ func newTestMachinesetWithReplicas(name string, specReplicas, statusReplicas, av
 		Status: clusterv1.MachineSetStatus{
 			AvailableReplicas: availableReplicas,
 			Replicas:          statusReplicas,
+			Conditions:        conditions,
 		},
 	}
 }
@@ -460,7 +461,7 @@ func TestSyncDeploymentStatus(t *testing.T) {
 			name:           "Deployment not available: MachineDeploymentAvailableCondition should exist and be false",
 			d:              newTestMachineDeployment(&pds, 3, 2, 2, 2, clusterv1.Conditions{}),
 			oldMachineSets: []*clusterv1.MachineSet{},
-			newMachineSet:  newTestMachinesetWithReplicas("foo", 3, 2, 2),
+			newMachineSet:  newTestMachinesetWithReplicas("foo", 3, 2, 2, clusterv1.Conditions{}),
 			expectedConditions: []*clusterv1.Condition{
 				{
 					Type:     clusterv1.MachineDeploymentAvailableCondition,
@@ -474,7 +475,7 @@ func TestSyncDeploymentStatus(t *testing.T) {
 			name:           "Deployment Available: MachineDeploymentAvailableCondition should exist and be true",
 			d:              newTestMachineDeployment(&pds, 3, 3, 3, 3, clusterv1.Conditions{}),
 			oldMachineSets: []*clusterv1.MachineSet{},
-			newMachineSet:  newTestMachinesetWithReplicas("foo", 3, 3, 3),
+			newMachineSet:  newTestMachinesetWithReplicas("foo", 3, 3, 3, clusterv1.Conditions{}),
 			expectedConditions: []*clusterv1.Condition{
 				{
 					Type:   clusterv1.MachineDeploymentAvailableCondition,
@@ -482,6 +483,41 @@ func TestSyncDeploymentStatus(t *testing.T) {
 				},
 			},
 		},
+		{
+			name:           "MachineSet exist: MachineSetReadyCondition should exist and mirror MachineSet Ready condition",
+			d:              newTestMachineDeployment(&pds, 3, 3, 3, 3, clusterv1.Conditions{}),
+			oldMachineSets: []*clusterv1.MachineSet{},
+			newMachineSet: newTestMachinesetWithReplicas("foo", 3, 3, 3, clusterv1.Conditions{
+				{
+					Type:    clusterv1.ReadyCondition,
+					Status:  corev1.ConditionFalse,
+					Reason:  "TestErrorResaon",
+					Message: "test error messsage",
+				},
+			}),
+			expectedConditions: []*clusterv1.Condition{
+				{
+					Type:    clusterv1.MachineSetReadyCondition,
+					Status:  corev1.ConditionFalse,
+					Reason:  "TestErrorResaon",
+					Message: "test error messsage",
+				},
+			},
+		},
+		{
+			name:           "MachineSet doesn't exist: MachineSetReadyCondition should exist and be false",
+			d:              newTestMachineDeployment(&pds, 3, 3, 3, 3, clusterv1.Conditions{}),
+			oldMachineSets: []*clusterv1.MachineSet{},
+			newMachineSet:  nil,
+			expectedConditions: []*clusterv1.Condition{
+				{
+					Type:     clusterv1.MachineSetReadyCondition,
+					Status:   corev1.ConditionFalse,
+					Severity: clusterv1.ConditionSeverityInfo,
+					Reason:   clusterv1.WaitingForMachineSetFallbackReason,
+				},
+			},
+		},
 	}
 
 	for _, test := range tests {