diff --git a/.github/workflows/test.yml b/.github/workflows/test.yml
index e93df91f64d6..3a78a68af240 100644
--- a/.github/workflows/test.yml
+++ b/.github/workflows/test.yml
@@ -148,6 +148,7 @@ jobs:
 
   integration:
     name: Integration tests
+    # on macOS 12, the default vmType is QEMU
     runs-on: macos-12
     timeout-minutes: 120
     steps:
@@ -389,13 +390,14 @@ jobs:
 
   vz:
     name: "vz"
+    # on macOS 13, the default vmType is VZ
     runs-on: macos-13
     timeout-minutes: 120
     strategy:
       fail-fast: false
       matrix:
         template:
-        - experimental/vz.yaml
+        - default.yaml
         - fedora.yaml
     steps:
     - uses: actions/checkout@v4
@@ -422,6 +424,4 @@ jobs:
     - name: Uninstall qemu
       run: brew uninstall --ignore-dependencies --force qemu
     - name: Test
-      env:
-        LIMACTL_CREATE_ARGS: "--vm-type vz --mount-type virtiofs --rosetta --network vzNAT"
       run: ./hack/test-templates.sh templates/${{ matrix.template }}
diff --git a/examples/default.yaml b/examples/default.yaml
index 445aac06aaf7..c33c63db434e 100644
--- a/examples/default.yaml
+++ b/examples/default.yaml
@@ -8,7 +8,7 @@
 # VM type: "qemu", "vz" (on macOS 13 and later), or "default".
 # The vmType can be specified only on creating the instance.
 # The vmType of existing instances cannot be changed.
-# 🟢 Builtin default: "qemu"
+# 🟢 Builtin default: "vz" (on macOS 13.5 and later), "qemu" (on others)
 vmType: null
 
 # OS: "Linux".
diff --git a/pkg/limayaml/defaults.go b/pkg/limayaml/defaults.go
index 13815bb675fe..ffe0d55cc9d5 100644
--- a/pkg/limayaml/defaults.go
+++ b/pkg/limayaml/defaults.go
@@ -3,6 +3,7 @@ package limayaml
 import (
 	"bytes"
 	"crypto/sha256"
+	"errors"
 	"fmt"
 	"net"
 	"os"
@@ -13,6 +14,7 @@ import (
 	"strings"
 	"text/template"
 
+	"github.com/coreos/go-semver/semver"
 	"github.com/docker/go-units"
 	"github.com/pbnjay/memory"
 	"github.com/sirupsen/logrus"
@@ -178,7 +180,7 @@ func FillDefault(y, d, o *LimaYAML, filePath string) {
 	if o.VMType != nil {
 		y.VMType = o.VMType
 	}
-	y.VMType = ptr.Of(ResolveVMType(y.VMType))
+	y.VMType = ptr.Of(ResolveVMType(y, d, o, filePath))
 	if y.OS == nil {
 		y.OS = d.OS
 	}
@@ -905,11 +907,97 @@ func NewVMType(driver string) VMType {
 	}
 }
 
-func ResolveVMType(s *string) VMType {
-	if s == nil || *s == "" || *s == "default" {
+func isExistingInstanceDir(dir string) bool {
+	// existence of "lima.yaml" does not signify existence of the instance,
+	// because the file is created during the initialization of the instance.
+	for _, f := range []string{
+		filenames.HostAgentStdoutLog, filenames.HostAgentStderrLog,
+		filenames.VzIdentifier, filenames.BaseDisk, filenames.DiffDisk, filenames.CIDataISO,
+	} {
+		file := filepath.Join(dir, f)
+		if _, err := os.Lstat(file); !errors.Is(err, os.ErrNotExist) {
+			return true
+		}
+	}
+	return false
+}
+
+func ResolveVMType(y, d, o *LimaYAML, filePath string) VMType {
+	// Check if the VMType is explicitly specified
+	for i, f := range []*LimaYAML{o, y, d} {
+		if f.VMType != nil && *f.VMType != "" && *f.VMType != "default" {
+			logrus.Debugf("ResolveVMType: resolved VMType %q (explicitly specified in []*LimaYAML{o,y,d}[%d])", *f.VMType, i)
+			return NewVMType(*f.VMType)
+		}
+	}
+
+	// If this is an existing instance, guess the VMType from the contents of the instance directory.
+	// Note that the instance directory may be created by a previous version of Lima.
+	if dir, basename := filepath.Split(filePath); dir != "" && basename == filenames.LimaYAML && isExistingInstanceDir(dir) {
+		vzIdentifier := filepath.Join(dir, filenames.VzIdentifier) // since Lima v0.14
+		if _, err := os.Lstat(vzIdentifier); !errors.Is(err, os.ErrNotExist) {
+			logrus.Debugf("ResolveVMType: resolved VMType %q (existing instance, with %q)", VZ, vzIdentifier)
+			return VZ
+		}
+		logrus.Debugf("ResolveVMType: resolved VMType %q (existing instance, without %q)", QEMU, vzIdentifier)
+		return QEMU
+	}
+
+	// Resolve the best type, depending on GOOS
+	switch runtime.GOOS {
+	case "darwin":
+		macOSProductVersion, err := osutil.ProductVersion()
+		if err != nil {
+			logrus.WithError(err).Warn("Failed to get macOS product version")
+			logrus.Debugf("ResolveVMType: resolved VMType %q (default for unknown version of macOS)", QEMU)
+			return QEMU
+		}
+		// Virtualization.framework in macOS prior to 13.5 could not boot Linux kernel v6.2 on Intel
+		// https://github.com/lima-vm/lima/issues/1577
+		if macOSProductVersion.LessThan(*semver.New("13.5.0")) {
+			logrus.Debugf("ResolveVMType: resolved VMType %q (default for macOS prior to 13.5)", QEMU)
+			return QEMU
+		}
+		// Use QEMU if the config depends on QEMU
+		for i, f := range []*LimaYAML{o, y, d} {
+			if f.Arch != nil && !IsNativeArch(*f.Arch) {
+				logrus.Debugf("ResolveVMType: resolved VMType %q (non-native arch=%q is specified in []*LimaYAML{o,y,d}[%d])", QEMU, *f.Arch, i)
+				return QEMU
+			}
+			if f.Firmware.LegacyBIOS != nil && *f.Firmware.LegacyBIOS {
+				logrus.Debugf("ResolveVMType: resolved VMType %q (firmware.legacyBIOS is specified in []*LimaYAML{o,y,d}[%d])", QEMU, i)
+				return QEMU
+			}
+			if f.MountType != nil && *f.MountType == NINEP {
+				logrus.Debugf("ResolveVMType: resolved VMType %q (mountType=%q is specified in []*LimaYAML{o,y,d}[%d])", QEMU, NINEP, i)
+				return QEMU
+			}
+			if f.Audio.Device != nil {
+				switch *f.Audio.Device {
+				case "", "none", "default", "vz":
+					// NOP
+				default:
+					logrus.Debugf("ResolveVMType: resolved VMType %q (audio.device=%q is specified in []*LimaYAML{o,y,d}[%d])", QEMU, *f.Audio.Device, i)
+					return QEMU
+				}
+			}
+			if f.Video.Display != nil {
+				switch *f.Video.Display {
+				case "", "none", "default", "vz":
+					// NOP
+				default:
+					logrus.Debugf("ResolveVMType: resolved VMType %q (video.display=%q is specified in []*LimaYAML{o,y,d}[%d])", QEMU, *f.Video.Display, i)
+					return QEMU
+				}
+			}
+		}
+		// Use VZ if the config is compatible with VZ
+		logrus.Debugf("ResolveVMType: resolved VMType %q (default for macOS 13.5 and later)", VZ)
+		return VZ
+	default:
+		logrus.Debugf("ResolveVMType: resolved VMType %q (default for GOOS=%q)", QEMU, runtime.GOOS)
 		return QEMU
 	}
-	return NewVMType(*s)
 }
 
 func ResolveOS(s *string) OS {
diff --git a/pkg/limayaml/defaults_test.go b/pkg/limayaml/defaults_test.go
index ecca9e362c00..c2cac0d2e904 100644
--- a/pkg/limayaml/defaults_test.go
+++ b/pkg/limayaml/defaults_test.go
@@ -14,12 +14,16 @@ import (
 	"github.com/lima-vm/lima/pkg/ptr"
 	"github.com/lima-vm/lima/pkg/store/dirnames"
 	"github.com/lima-vm/lima/pkg/store/filenames"
+	"github.com/sirupsen/logrus"
 	"gotest.tools/v3/assert"
 )
 
 func TestFillDefault(t *testing.T) {
+	logrus.SetLevel(logrus.DebugLevel)
 	var d, y, o LimaYAML
 
+	defaultVMType := ResolveVMType(&y, &d, &o, "")
+
 	opts := []cmp.Option{
 		// Consider nil slices and empty slices to be identical
 		cmpopts.EquateEmpty(),
@@ -59,7 +63,7 @@ func TestFillDefault(t *testing.T) {
 
 	// Builtin default values
 	builtin := LimaYAML{
-		VMType:             ptr.Of("qemu"),
+		VMType:             &defaultVMType,
 		OS:                 ptr.Of(LINUX),
 		Arch:               ptr.Of(arch),
 		CPUType:            defaultCPUType(),
@@ -189,6 +193,7 @@ func TestFillDefault(t *testing.T) {
 	}
 
 	expect := builtin
+	expect.VMType = ptr.Of(QEMU) // due to NINEP
 	expect.HostResolver.Hosts = map[string]string{
 		"MY.Host": "host.lima.internal",
 	}
@@ -459,6 +464,7 @@ func TestFillDefault(t *testing.T) {
 	// "TWO" does not exist in filledDefaults.Env, so is set from d.Env
 	expect.Env["TWO"] = d.Env["TWO"]
 
+	t.Logf("d.vmType=%q, y.vmType=%q, expect.vmType=%q", *d.VMType, *y.VMType, *expect.VMType)
 	FillDefault(&y, &d, &LimaYAML{}, filePath)
 	assert.DeepEqual(t, &y, &expect, opts...)
 
diff --git a/website/content/en/docs/config/vmtype/_index.md b/website/content/en/docs/config/vmtype/_index.md
index 73978be06dae..25ef8d4ad4ef 100644
--- a/website/content/en/docs/config/vmtype/_index.md
+++ b/website/content/en/docs/config/vmtype/_index.md
@@ -22,9 +22,12 @@ flowchart
   intel_on_arm --  "No" --> vz["VZ"]
 ```
 
+The default vmType is QEMU in Lima prior to v1.0.
+Starting with Lima v1.0, Lima will use VZ by default on macOS (>= 13.5) for new instances,
+unless the config is incompatible with VZ. (e.g., legacyBIOS or 9p is enabled)
+
 ## QEMU
 "qemu" option makes use of QEMU to run guest operating system. 
-This option is used by default if "vmType" is not set.
 
 ## VZ
 > **Warning**