diff --git a/docs/DEPLOY.md b/docs/DEPLOY.md
index 51cd26a8..853f0ea6 100644
--- a/docs/DEPLOY.md
+++ b/docs/DEPLOY.md
@@ -94,7 +94,7 @@ If rollback is enabled, the name of the created package will include the UTC tim
 
 ##### Sequence diagram for deployment to blob storage
 
-![alt text](./sequenceDiagrams/deployBlob.png)
+![alt text](./sequenceDiagrams/deployExternal.png)
 
 ##### Sub-Commands
 
diff --git a/docs/sequenceDiagrams/deployBlob.png b/docs/sequenceDiagrams/deployBlob.png
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index 4593ee97..00000000
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diff --git a/docs/sequenceDiagrams/deployExternal.md b/docs/sequenceDiagrams/deployExternal.md
new file mode 100644
index 00000000..6a19eb29
--- /dev/null
+++ b/docs/sequenceDiagrams/deployExternal.md
@@ -0,0 +1,18 @@
+## Deployment - External Package
+```mermaid
+sequenceDiagram
+  participant s as Serverless CLI
+  participant r as Resource Group
+  participant f as Function App
+  participant b as Blob Storage
+
+  note right of s: `sls deploy`
+  s ->> r: Create resource group
+  s ->> r: Deploy ARM template
+  r ->> f: Included in ARM template, Deploy with RUN_FROM_PACKAGE = 1
+  r ->> b: Included in ARM template
+  note right of s: Zip code
+  s ->> b: Upload zipped code with name {serviceName}-t{timestamp}.zip
+  b ->> s: Generate SAS URL for package blob
+  s ->> f: Set RUN_FROM_PACKAGE = SAS URL
+```
diff --git a/docs/sequenceDiagrams/deployExternal.png b/docs/sequenceDiagrams/deployExternal.png
new file mode 100644
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diff --git a/docs/sequenceDiagrams/deployBlob.md b/docs/sequenceDiagrams/deployInternal.md
similarity index 50%
rename from docs/sequenceDiagrams/deployBlob.md
rename to docs/sequenceDiagrams/deployInternal.md
index a1e79d7f..3e676fed 100644
--- a/docs/sequenceDiagrams/deployBlob.md
+++ b/docs/sequenceDiagrams/deployInternal.md
@@ -1,17 +1,18 @@
+## Deployment - Internal Package
+
 ```mermaid
 sequenceDiagram
   participant s as Serverless CLI
-  participant r as Resource Group 
+  participant r as Resource Group
   participant f as Function App
   participant b as Blob Storage
 
   note right of s: `sls deploy`
   s ->> r: Create resource group
   s ->> r: Deploy ARM template
-  r ->> f: Included in ARM template
+  r ->> f: Included in ARM template, RUN_FROM_PACKAGE = 1
   r ->> b: Included in ARM template
   note right of s: Zip code
-  s ->> b: Deploy zip code with name {serviceName}-t{timestamp}.zip
-  s ->> f: Set package path in settings
-  note right of s: Log URLs 
-```
\ No newline at end of file
+  s ->> f: Upload zipped code directly to function app
+  s ->> b: Upload zipped code with name {serviceName}-t{timestamp}.zip (for rollback purposes)
+```
diff --git a/docs/sequenceDiagrams/deployInternal.png b/docs/sequenceDiagrams/deployInternal.png
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