diff --git a/Corefile b/Corefile
new file mode 100644
index 0000000..231dccf
--- /dev/null
+++ b/Corefile
@@ -0,0 +1,3 @@
+.:53 {
+    forward . /etc/resolv.conf
+}
diff --git a/Dockerfile.multiarch b/Dockerfile.multiarch
index 5423829..92e1a22 100644
--- a/Dockerfile.multiarch
+++ b/Dockerfile.multiarch
@@ -27,7 +27,7 @@ ENV BUILDX_VERSION="${BUILDX_VERSION:-v0.10.4}"
 ENV DOCKER_HOST=unix:///var/run/docker.sock
 
 RUN apk --update add --virtual .build-deps curl && \
-    apk --update add --no-cache git && \
+    apk --update add --no-cache git coredns && \
     mkdir -p /usr/lib/docker/cli-plugins/ && \
     curl -SsL -o /usr/lib/docker/cli-plugins/docker-buildx \
         "https://github.com/docker/buildx/releases/download/v${BUILDX_VERSION##v}/buildx-v${BUILDX_VERSION##v}.${TARGETOS:-linux}-${TARGETARCH:-amd64}" && \
@@ -36,5 +36,6 @@ RUN apk --update add --virtual .build-deps curl && \
     rm -rf /var/cache/apk/* && \
     rm -rf /tmp/*
 
+COPY --from=build /src/Corefile /etc/coredns/Corefile
 COPY --from=build /src/dist/drone-docker-buildx /bin/drone-docker-buildx
 ENTRYPOINT ["/usr/local/bin/dockerd-entrypoint.sh", "drone-docker-buildx"]
diff --git a/plugin/coredns.go b/plugin/coredns.go
new file mode 100644
index 0000000..2178706
--- /dev/null
+++ b/plugin/coredns.go
@@ -0,0 +1,40 @@
+package plugin
+
+import (
+	"io"
+	"net"
+	"os"
+	"os/exec"
+)
+
+func (p Plugin) startCoredns() {
+	cmd := exec.Command("coredns", "-conf", "/etc/coredns/Corefile")
+	if p.settings.Daemon.Debug {
+		cmd.Stdout = os.Stdout
+		cmd.Stderr = os.Stderr
+	} else {
+		cmd.Stdout = io.Discard
+		cmd.Stderr = io.Discard
+	}
+
+	go func() {
+		trace(cmd)
+		_ = cmd.Run()
+	}()
+}
+
+func getContainerIP() (string, error) {
+	netInterfaceAddrList, err := net.InterfaceAddrs()
+	if err != nil {
+		return "", err
+	}
+
+	for _, netInterfaceAddr := range netInterfaceAddrList {
+		netIP, ok := netInterfaceAddr.(*net.IPNet)
+		if ok && !netIP.IP.IsLoopback() && netIP.IP.To4() != nil {
+			return netIP.IP.String(), nil
+		}
+	}
+
+	return "", nil
+}
diff --git a/plugin/impl.go b/plugin/impl.go
index f4ab22c..ce530b7 100644
--- a/plugin/impl.go
+++ b/plugin/impl.go
@@ -111,9 +111,29 @@ func (p *Plugin) Validate() error {
 }
 
 // Execute provides the implementation of the plugin.
+//
+//nolint:gocognit
 func (p *Plugin) Execute() error {
 	// start the Docker daemon server
+	//nolint: nestif
 	if !p.settings.Daemon.Disabled {
+		// If no custom DNS value set start internal DNS server
+		if len(p.settings.Daemon.DNS.Value()) == 0 {
+			ip, err := getContainerIP()
+			if err != nil {
+				logrus.Warnf("error detecting IP address: %v", err)
+			}
+
+			if ip != "" {
+				logrus.Debugf("discovered IP address: %v", ip)
+				p.startCoredns()
+
+				if err := p.settings.Daemon.DNS.Set(ip); err != nil {
+					return fmt.Errorf("error setting daemon dns: %w", err)
+				}
+			}
+		}
+
 		p.startDaemon()
 	}