diff --git a/vpd-tool/include/tool_constants.hpp b/vpd-tool/include/tool_constants.hpp
index 3201755..b813933 100644
--- a/vpd-tool/include/tool_constants.hpp
+++ b/vpd-tool/include/tool_constants.hpp
@@ -54,6 +54,7 @@
     "xyz.openbmc_project.BIOSConfig.Manager";
 
 constexpr auto KwdIM = "IM";
+constexpr auto badVpdPath = "/var/lib/vpd/dumps";
 
 // Valid IM values list.
 static std::vector<std::string> validImValues{
diff --git a/vpd-tool/include/vpd_tool.hpp b/vpd-tool/include/vpd_tool.hpp
index ed2aa00..3a8e85a 100644
--- a/vpd-tool/include/vpd_tool.hpp
+++ b/vpd-tool/include/vpd_tool.hpp
@@ -363,5 +363,13 @@
      * @return On success returns 0, otherwise returns -1.
      */
     int resetVpdOnDbus();
+
+    /**
+     * @brief API to clear vpd dump directory
+     *
+     * This API deletes all the files inside vpd dump directory and then deletes
+     * the directory from the filesystem
+     */
+    void clearVpdDumpDir() const noexcept;
 };
 } // namespace vpd
diff --git a/vpd-tool/src/vpd_tool.cpp b/vpd-tool/src/vpd_tool.cpp
index 786af8c..c275509 100644
--- a/vpd-tool/src/vpd_tool.cpp
+++ b/vpd-tool/src/vpd_tool.cpp
@@ -1540,4 +1540,22 @@
     }
     return l_result;
 }
+
+void VpdTool::clearVpdDumpDir() const noexcept
+{
+    try
+    {
+        if (std::filesystem::exists(constants::badVpdPath))
+        {
+            std::filesystem::remove_all(constants::badVpdPath);
+        }
+    }
+    catch (const std::exception& l_ex)
+    {
+        std::cerr << "Failed to clear VPD dump path:[" +
+                         std::string(constants::badVpdPath) + "]. Error: "
+                  << l_ex.what() << std::endl;
+    }
+}
+
 } // namespace vpd
diff --git a/vpd-tool/src/vpd_tool_main.cpp b/vpd-tool/src/vpd_tool_main.cpp
index 152cfca..e0bbf7a 100644
--- a/vpd-tool/src/vpd_tool_main.cpp
+++ b/vpd-tool/src/vpd_tool_main.cpp
@@ -62,6 +62,10 @@
     }
 
     vpd::VpdTool l_vpdToolObj;
+
+    // delete the vpd dump directory
+    l_vpdToolObj.clearVpdDumpDir();
+
     return l_vpdToolObj.cleanSystemVpd(!i_syncBiosAttributesFlag->empty());
 }