diff --git a/CHANGELOG.md b/CHANGELOG.md
index b4f01f059970..e1b46d07c7b6 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -13,6 +13,7 @@ These changes are available in the [master branch](https://github.com/PrefectHQ/
 - Add OS platform check to Local Agent for running on Windows machines - [#1441](https://github.com/PrefectHQ/prefect/pull/1441)
 - Add `--base-url` argument for Docker daemons to `agent start` CLI command - [#1441](https://github.com/PrefectHQ/prefect/pull/1441)
 - Add environment labels for organizing / tagging different Flow execution environments - [#1438](https://github.com/PrefectHQ/prefect/issues/1438)
+- Use `-U` option when installing `prefect` in Docker containers to override base image version - [#1461](https://github.com/PrefectHQ/prefect/pull/1461)
 
 ### Task Library
 
diff --git a/src/prefect/environments/storage/docker.py b/src/prefect/environments/storage/docker.py
index 9933f12a84f8..cd961681fe7b 100644
--- a/src/prefect/environments/storage/docker.py
+++ b/src/prefect/environments/storage/docker.py
@@ -358,8 +358,8 @@ def create_dockerfile_object(self, directory: str = None) -> None:
                 ENV PREFECT__USER_CONFIG_PATH="/root/.prefect/config.toml"
                 {env_vars}
 
-                RUN pip install git+https://github.com/PrefectHQ/prefect.git@{version}#egg=prefect[kubernetes]
-                # RUN pip install prefect
+                # update version if base image already has prefect installed
+                RUN pip install -U git+https://github.com/PrefectHQ/prefect.git@{version}#egg=prefect[kubernetes]
 
                 RUN python /root/.prefect/healthcheck.py '[{flow_file_paths}]' '{python_version}'
                 """.format(