diff --git a/CHANGELOG.md b/CHANGELOG.md
index a496863420..55e6e868d5 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -2,6 +2,11 @@
 
 # UNRELEASED
 
+=== feat: Read dfx canister install argument from a file
+
+Enables passing large arguments that cannot be passed directly in the command line using the `--argument-file` flag. For example `dfx canister install --argument-file ./my/argument/file.txt my_canister_name`.
+
+
 ### feat: change `list_permitted` and `list_authorized` to an update call.
 
 This requires the `list_authorized` and `list_permitted` methods to be called as an update and disables the ability to
diff --git a/docs/cli-reference/dfx-canister.md b/docs/cli-reference/dfx-canister.md
index 555b83df78..ffc06eed56 100644
--- a/docs/cli-reference/dfx-canister.md
+++ b/docs/cli-reference/dfx-canister.md
@@ -438,6 +438,7 @@ You can use the following optional flags with the `dfx canister install` command
 
 | Flag                  | Description                                                                                                                                                             |
 |-----------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
+| `--argument-file`     | Specifies the file from which to read the argument to pass to the init method.  Stdin may be referred to as `-`.                                                        |
 | `--async-call`        | Enables you to continue without waiting for the result of the installation to be returned by polling the Internet Computer or the local canister execution environment. |
 | `--upgrade-unchanged` | Upgrade the canister even if the .wasm did not change.                                                                                                                  |
 
diff --git a/e2e/tests-dfx/install.bash b/e2e/tests-dfx/install.bash
index 04fcb84fa9..5511205a07 100644
--- a/e2e/tests-dfx/install.bash
+++ b/e2e/tests-dfx/install.bash
@@ -182,7 +182,32 @@ teardown() {
   assert_contains db07e7e24f6f8ddf53c33a610713259a7c1eb71c270b819ebd311e2d223267f0
 }
 
+@test "installing one canister with an argument succeeds" {
+  dfx_start
+  assert_command dfx canister create e2e_project_backend
+  assert_command dfx build e2e_project_backend
+  assert_command dfx canister install e2e_project_backend --argument '()'
+}
+
+@test "installing with an argument in a file succeeds" {
+  dfx_start
+  assert_command dfx canister create e2e_project_backend
+  assert_command dfx build e2e_project_backend
+  TMPFILE="$(mktemp)"
+  echo '()' >"$TMPFILE"
+  assert_command dfx canister install e2e_project_backend --argument-file "$TMPFILE"
+}
+
+@test "installing with an argument on stdin succeeds" {
+  dfx_start
+  assert_command dfx canister create e2e_project_backend
+  assert_command dfx build e2e_project_backend
+  TMPFILE="$(mktemp)"
+  echo '()' >"$TMPFILE"
+  assert_command dfx canister install e2e_project_backend --argument-file - <"$TMPFILE"
+}
+
 @test "installing multiple canisters with arguments fails" {
-  assert_command_fail dfx canister install --all --argument hello
+  assert_command_fail dfx canister install --all --argument '()'
   assert_contains "error: the argument '--all' cannot be used with '--argument <ARGUMENT>'"
 }
diff --git a/src/dfx/src/commands/canister/install.rs b/src/dfx/src/commands/canister/install.rs
index 2985cbb347..304c5eab69 100644
--- a/src/dfx/src/commands/canister/install.rs
+++ b/src/dfx/src/commands/canister/install.rs
@@ -3,8 +3,12 @@ use crate::lib::environment::Environment;
 use crate::lib::error::DfxResult;
 use crate::lib::operations::canister::install_canister::install_canister;
 use crate::lib::root_key::fetch_root_key_if_needed;
+use crate::util::clap::parsers::file_or_stdin_parser;
 use crate::util::get_candid_init_type;
-use crate::{lib::canister_info::CanisterInfo, util::blob_from_arguments};
+use crate::{
+    lib::canister_info::CanisterInfo,
+    util::{arguments_from_file, blob_from_arguments},
+};
 use dfx_core::identity::CallSender;
 
 use anyhow::{anyhow, bail, Context};
@@ -40,9 +44,17 @@ pub struct CanisterInstallOpts {
     upgrade_unchanged: bool,
 
     /// Specifies the argument to pass to the method.
-    #[arg(long)]
+    #[arg(long, conflicts_with("argument_file"))]
     argument: Option<String>,
 
+    /// Specifies the file from which to read the argument to pass to the method.
+    #[arg(
+        long,
+        value_parser = file_or_stdin_parser,
+        conflicts_with("argument")
+    )]
+    argument_file: Option<PathBuf>,
+
     /// Specifies the data type for the argument when making the call using an argument.
     #[arg(long, requires("argument"), value_parser = ["idl", "raw"])]
     argument_type: Option<String>,
@@ -107,7 +119,14 @@ pub async fn exec(
 
         let canister_id =
             Principal::from_text(canister).or_else(|_| canister_id_store.get(canister))?;
+
+        let arguments_from_file = opts
+            .argument_file
+            .map(|v| arguments_from_file(&v))
+            .transpose()?;
         let arguments = opts.argument.as_deref();
+        let arguments = arguments_from_file.as_deref().or(arguments);
+
         let arg_type = opts.argument_type.as_deref();
         let canister_info = config.as_ref()
             .ok_or_else(|| anyhow!("Cannot find dfx configuration file in the current working directory. Did you forget to create one?"))