diff --git a/test/extended/node/node_e2e/initcontainer.go b/test/extended/node/node_e2e/initcontainer.go
new file mode 100644
index 000000000000..6e095fe222d7
--- /dev/null
+++ b/test/extended/node/node_e2e/initcontainer.go
@@ -0,0 +1,153 @@
+package node
+
+import (
+	"context"
+	"fmt"
+	"regexp"
+	"time"
+
+	g "github.com/onsi/ginkgo/v2"
+	o "github.com/onsi/gomega"
+	corev1 "k8s.io/api/core/v1"
+	metav1 "k8s.io/apimachinery/pkg/apis/meta/v1"
+	"k8s.io/apimachinery/pkg/util/wait"
+	e2e "k8s.io/kubernetes/test/e2e/framework"
+	e2epod "k8s.io/kubernetes/test/e2e/framework/pod"
+
+	nodeutils "github.com/openshift/origin/test/extended/node"
+	exutil "github.com/openshift/origin/test/extended/util"
+)
+
+var _ = g.Describe("[sig-node] [Jira:Node/Kubelet] NODE initContainer policy,volume,readiness,quota", func() {
+	defer g.GinkgoRecover()
+
+	var (
+		oc = exutil.NewCLI("node-initcontainer")
+	)
+
+	// Skip all tests on MicroShift clusters as MachineConfig resources are not available
+	g.BeforeEach(func() {
+		isMicroShift, err := exutil.IsMicroShiftCluster(oc.AdminKubeClient())
+		o.Expect(err).NotTo(o.HaveOccurred())
+		if isMicroShift {
+			g.Skip("Skipping test on MicroShift cluster - MachineConfig resources are not available")
+		}
+	})
+
+	//author: bgudi@redhat.com
+	g.It("[OTP] Init containers should not restart when the exited init container is removed from node [OCP-38271]", func() {
+		g.By("Test for case OCP-38271")
+		oc.SetupProject()
+
+		podName := "initcon-pod"
+		namespace := oc.Namespace()
+		ctx := context.Background()
+
+		g.By("Create a pod with init container")
+		pod := &corev1.Pod{
+			ObjectMeta: metav1.ObjectMeta{
+				Name:      podName,
+				Namespace: namespace,
+			},
+			Spec: corev1.PodSpec{
+				InitContainers: []corev1.Container{
+					{
+						Name:    "inittest",
+						Image:   "image-registry.openshift-image-registry.svc:5000/openshift/tools:latest",
+						Command: []string{"/bin/sh", "-ec", "echo running >> /mnt/data/test"},
+						VolumeMounts: []corev1.VolumeMount{
+							{
+								Name:      "data",
+								MountPath: "/mnt/data",
+							},
+						},
+					},
+				},
+				Containers: []corev1.Container{
+					{
+						Name:    "hello-test",
+						Image:   "image-registry.openshift-image-registry.svc:5000/openshift/tools:latest",
+						Command: []string{"/bin/sh", "-c", "sleep 3600"},
+						VolumeMounts: []corev1.VolumeMount{
+							{
+								Name:      "data",
+								MountPath: "/mnt/data",
+							},
+						},
+					},
+				},
+				Volumes: []corev1.Volume{
+					{
+						Name: "data",
+						VolumeSource: corev1.VolumeSource{
+							EmptyDir: &corev1.EmptyDirVolumeSource{},
+						},
+					},
+				},
+				RestartPolicy: corev1.RestartPolicyNever,
+			},
+		}
+
+		_, err := oc.KubeClient().CoreV1().Pods(namespace).Create(ctx, pod, metav1.CreateOptions{})
+		o.Expect(err).NotTo(o.HaveOccurred())
+		defer func() {
+			oc.KubeClient().CoreV1().Pods(namespace).Delete(ctx, podName, metav1.DeleteOptions{})
+		}()
+
+		g.By("Check pod status")
+		err = e2epod.WaitForPodRunningInNamespace(ctx, oc.KubeClient(), pod)
+		o.Expect(err).NotTo(o.HaveOccurred(), "pod is not running")
+
+		g.By("Get pod and verify init container exited normally")
+		pod, err = oc.KubeClient().CoreV1().Pods(namespace).Get(ctx, podName, metav1.GetOptions{})
+		o.Expect(err).NotTo(o.HaveOccurred())
+
+		o.Expect(pod.Status.InitContainerStatuses).To(o.ContainElement(o.SatisfyAll(
+			o.HaveField("Name", "inittest"),
+			o.HaveField("State.Terminated.ExitCode", o.Equal(int32(0))),
+		)), "init container 'inittest' should have terminated with exit code 0")
+
+		nodeName := pod.Spec.NodeName
+		o.Expect(nodeName).NotTo(o.BeEmpty(), "pod node name is empty")
+
+		g.By("Get init container ID from pod status")
+		var containerID string
+		for _, status := range pod.Status.InitContainerStatuses {
+			if status.Name == "inittest" {
+				containerID = status.ContainerID
+				break
+			}
+		}
+		o.Expect(containerID).NotTo(o.BeEmpty(), "init container ID is empty")
+
+		// Extract the actual container ID (remove prefix like "cri-o://")
+		containerIDPattern := regexp.MustCompile(`^[^/]+://(.+)$`)
+		matches := containerIDPattern.FindStringSubmatch(containerID)
+		o.Expect(matches).To(o.HaveLen(2), "failed to parse container ID")
+		actualContainerID := matches[1]
+
+		g.By("Delete init container from node")
+		output, err := nodeutils.ExecOnNodeWithChroot(oc, nodeName, "crictl", "rm", actualContainerID)
+		o.Expect(err).NotTo(o.HaveOccurred(), "fail to delete container")
+		e2e.Logf("Container deletion output: %s", output)
+
+		g.By("Check init container not restart again")
+		err = wait.Poll(5*time.Second, 1*time.Minute, func() (bool, error) {
+			pod, err := oc.KubeClient().CoreV1().Pods(namespace).Get(ctx, podName, metav1.GetOptions{})
+			if err != nil {
+				return false, err
+			}
+			for _, status := range pod.Status.InitContainerStatuses {
+				if status.Name == "inittest" {
+					if status.RestartCount > 0 {
+						e2e.Logf("Init container restarted, restart count: %d", status.RestartCount)
+						return true, fmt.Errorf("init container restarted")
+					}
+				}
+			}
+			e2e.Logf("Init container has not restarted")
+			return false, nil
+		})
+		o.Expect(err).To(o.Equal(wait.ErrWaitTimeout), "expected timeout while waiting confirms init container did not restart")
+	})
+})
diff --git a/test/extended/node/node_e2e/node.go b/test/extended/node/node_e2e/node.go
index a7814374b0ca..4bad5ff9a1b6 100644
--- a/test/extended/node/node_e2e/node.go
+++ b/test/extended/node/node_e2e/node.go
@@ -8,11 +8,12 @@ import (
 
 	g "github.com/onsi/ginkgo/v2"
 	o "github.com/onsi/gomega"
-	nodeutils "github.com/openshift/origin/test/extended/node"
-	exutil "github.com/openshift/origin/test/extended/util"
 	metav1 "k8s.io/apimachinery/pkg/apis/meta/v1"
 	"k8s.io/apimachinery/pkg/util/wait"
 	e2e "k8s.io/kubernetes/test/e2e/framework"
+
+	nodeutils "github.com/openshift/origin/test/extended/node"
+	exutil "github.com/openshift/origin/test/extended/util"
 )
 
 var _ = g.Describe("[sig-node] [Jira:Node/Kubelet] Kubelet, CRI-O, CPU manager", func() {