A system and method for efficiently transferring virtual machine images across nodes in a cloud computing environment, includes analyzing each image on each node to create hash code clusters and a similarity matrix. An instruction to transfer an image from a source node to a target node is received. The clusters and the similarity matrix are used to determine to what extent the data from the image is already on the source node, or on any other node, and further determines the cost and speed of transferring such data to the target node. An optimal transfer plan is generated, and data that is not already on the target node is transferred to the target node from the most efficient node on which it is available, according to the optimal transfer plan.