diff --git a/.eslintignore b/.eslintignore
index 12a3f68486047f..1219c51b015d0a 100644
--- a/.eslintignore
+++ b/.eslintignore
@@ -5,7 +5,6 @@ bower_components
 /target
 /.es
 /plugins
-/optimize
 /built_assets
 /html_docs
 /src/fixtures/vislib/mock_data
diff --git a/.gitignore b/.gitignore
index efb5c577746334..05f87c1a6538d0 100644
--- a/.gitignore
+++ b/.gitignore
@@ -8,7 +8,6 @@ node_modules
 !/src/dev/npm/integration_tests/__fixtures__/fixture1/node_modules
 !/src/dev/notice/__fixtures__/node_modules
 trash
-/optimize
 /built_assets
 target
 /build
diff --git a/docs/migration/migrate_8_0.asciidoc b/docs/migration/migrate_8_0.asciidoc
index 43bfec5252ebab..a36a93ce318253 100644
--- a/docs/migration/migrate_8_0.asciidoc
+++ b/docs/migration/migrate_8_0.asciidoc
@@ -74,4 +74,10 @@ specified explicitly.
 
 *Impact:* Define `xpack.security.authc.saml.realm` when using the SAML authentication provider instead.
 
-// end::notable-breaking-changes[]
\ No newline at end of file
+[float]
+=== `optimize` directory is now in the `data` folder
+*Details:* Generated bundles have moved to the configured `path.data` folder.
+
+*Impact:* Any workflow that involved manually clearing generated bundles will have to be updated with the new path.
+
+// end::notable-breaking-changes[]
diff --git a/docs/setup/install/deb.asciidoc b/docs/setup/install/deb.asciidoc
index 0bfbccbaed2bae..24e0bb4cf6c184 100644
--- a/docs/setup/install/deb.asciidoc
+++ b/docs/setup/install/deb.asciidoc
@@ -209,7 +209,7 @@ locations for a Debian-based system:
 | optimize
   | Transpiled source code. Certain administrative actions (e.g. plugin install)
     result in the source code being retranspiled on the fly.
-  | /usr/share/kibana/optimize
+  | /var/lib/kibana/optimize
  d|
 
 | plugins
diff --git a/docs/setup/install/rpm.asciidoc b/docs/setup/install/rpm.asciidoc
index 295ad10206b118..069c50ff874935 100644
--- a/docs/setup/install/rpm.asciidoc
+++ b/docs/setup/install/rpm.asciidoc
@@ -200,7 +200,7 @@ locations for an RPM-based system:
 | optimize
   | Transpiled source code. Certain administrative actions (e.g. plugin install)
     result in the source code being retranspiled on the fly.
-  | /usr/share/kibana/optimize
+  | /var/lib/kibana/optimize
  d|
 
 | plugins
diff --git a/docs/setup/install/targz.asciidoc b/docs/setup/install/targz.asciidoc
index 3bf48f180783ed..138431aca22fad 100644
--- a/docs/setup/install/targz.asciidoc
+++ b/docs/setup/install/targz.asciidoc
@@ -128,7 +128,7 @@ important data later on.
 | optimize
   | Transpiled source code. Certain administrative actions (e.g. plugin install)
     result in the source code being retranspiled on the fly.
-  | $KIBANA_HOME\optimize
+  | $KIBANA_HOME\data\optimize
  d|
 
 | plugins
diff --git a/docs/setup/install/windows.asciidoc b/docs/setup/install/windows.asciidoc
index b7f695062ae2c0..b9f0224e676999 100644
--- a/docs/setup/install/windows.asciidoc
+++ b/docs/setup/install/windows.asciidoc
@@ -96,7 +96,7 @@ important data later on.
 | optimize
   | Transpiled source code. Certain administrative actions (e.g. plugin install)
     result in the source code being retranspiled on the fly.
-  | $KIBANA_HOME\optimize
+  | $KIBANA_HOME\data\optimize
  d|
 
 | plugins
diff --git a/packages/kbn-test/src/functional_tests/lib/paths.js b/packages/kbn-test/src/functional_tests/lib/paths.js
index 6584f781638512..97ba44f4d711e2 100644
--- a/packages/kbn-test/src/functional_tests/lib/paths.js
+++ b/packages/kbn-test/src/functional_tests/lib/paths.js
@@ -32,4 +32,4 @@ export const KIBANA_FTR_SCRIPT = resolve(KIBANA_ROOT, 'scripts/functional_test_r
 export const PROJECT_ROOT = resolve(__dirname, '../../../../../../');
 export const FUNCTIONAL_CONFIG_PATH = resolve(KIBANA_ROOT, 'test/functional/config');
 export const API_CONFIG_PATH = resolve(KIBANA_ROOT, 'test/api_integration/config');
-export const OPTIMIZE_BUNDLE_DIR = resolve(KIBANA_ROOT, 'optimize/bundles');
+export const OPTIMIZE_BUNDLE_DIR = resolve(KIBANA_ROOT, 'data/optimize/bundles');
diff --git a/src/dev/build/tasks/create_empty_dirs_and_files_task.js b/src/dev/build/tasks/create_empty_dirs_and_files_task.js
index 7badb1c4989024..6bf059ca9519b3 100644
--- a/src/dev/build/tasks/create_empty_dirs_and_files_task.js
+++ b/src/dev/build/tasks/create_empty_dirs_and_files_task.js
@@ -25,8 +25,8 @@ export const CreateEmptyDirsAndFilesTask = {
   async run(config, log, build) {
     await Promise.all([
       mkdirp(build.resolvePath('plugins')),
-      mkdirp(build.resolvePath('data')),
-      write(build.resolvePath('optimize/.babel_register_cache.json'), '{}'),
+      mkdirp(build.resolvePath('data/optimize')),
+      write(build.resolvePath('data/optimize/.babel_register_cache.json'), '{}'),
     ]);
   },
 };
diff --git a/src/dev/build/tasks/os_packages/package_scripts/post_install.sh b/src/dev/build/tasks/os_packages/package_scripts/post_install.sh
index dd8638a0c20bfb..9cf08ea38254d2 100644
--- a/src/dev/build/tasks/os_packages/package_scripts/post_install.sh
+++ b/src/dev/build/tasks/os_packages/package_scripts/post_install.sh
@@ -34,6 +34,5 @@ case $1 in
   ;;
 esac
 
-chown -R <%= user %>:<%= group %> <%= optimizeDir %>
-chown <%= user %>:<%= group %> <%= dataDir %>
+chown -R <%= user %>:<%= group %> <%= dataDir %>
 chown <%= user %>:<%= group %> <%= pluginsDir %>
diff --git a/src/dev/build/tasks/os_packages/package_scripts/post_remove.sh b/src/dev/build/tasks/os_packages/package_scripts/post_remove.sh
index 25c46a54a222a0..1ff2dbee675bd9 100644
--- a/src/dev/build/tasks/os_packages/package_scripts/post_remove.sh
+++ b/src/dev/build/tasks/os_packages/package_scripts/post_remove.sh
@@ -44,10 +44,6 @@ if [ "$REMOVE_USER_AND_GROUP" = "true" ]; then
 fi
 
 if [ "$REMOVE_DIRS" = "true" ]; then
-  if [ -d "<%= optimizeDir %>" ]; then
-    rm -rf "<%= optimizeDir %>"
-  fi
-
   if [ -d "<%= pluginsDir %>" ]; then
     rm -rf "<%= pluginsDir %>"
   fi
diff --git a/src/dev/build/tasks/os_packages/run_fpm.js b/src/dev/build/tasks/os_packages/run_fpm.js
index cb3c560d6725a8..7272d7013a3219 100644
--- a/src/dev/build/tasks/os_packages/run_fpm.js
+++ b/src/dev/build/tasks/os_packages/run_fpm.js
@@ -89,7 +89,6 @@ export async function runFpm(config, log, build, type, pkgSpecificFlags) {
     // scripts, also causes scripts to be processed with erb
     '--template-value', `user=kibana`,
     '--template-value', `group=kibana`,
-    '--template-value', `optimizeDir=/usr/share/kibana/optimize`,
     '--template-value', `configDir=/etc/kibana`,
     '--template-value', `pluginsDir=/usr/share/kibana/plugins`,
     '--template-value', `dataDir=/var/lib/kibana`,
diff --git a/src/dev/notice/generate_notice_from_source.js b/src/dev/notice/generate_notice_from_source.js
index ba1492b9d82601..75bc7c8cb2f193 100644
--- a/src/dev/notice/generate_notice_from_source.js
+++ b/src/dev/notice/generate_notice_from_source.js
@@ -42,9 +42,9 @@ export async function generateNoticeFromSource({ productName, directory, log })
     cwd: directory,
     nodir: true,
     ignore: [
-      '{node_modules,build,target,dist,optimize,built_assets}/**',
+      '{node_modules,build,target,dist,data,built_assets}/**',
       'packages/*/{node_modules,build,target,dist}/**',
-      'x-pack/{node_modules,build,target,dist,optimize}/**',
+      'x-pack/{node_modules,build,target,dist,data}/**',
       'x-pack/packages/*/{node_modules,build,target,dist}/**',
     ]
   };
diff --git a/src/legacy/server/config/schema.js b/src/legacy/server/config/schema.js
index 8fbb3ef0614bb2..c8b9c25f9fb8d6 100644
--- a/src/legacy/server/config/schema.js
+++ b/src/legacy/server/config/schema.js
@@ -19,10 +19,7 @@
 
 import Joi from 'joi';
 import os from 'os';
-
-import {
-  fromRoot
-} from '../../utils';
+import { join } from 'path';
 import {
   getData
 } from '../path';
@@ -170,7 +167,7 @@ export default () => Joi.object({
   optimize: Joi.object({
     enabled: Joi.boolean().default(true),
     bundleFilter: Joi.string().default('!tests'),
-    bundleDir: Joi.string().default(fromRoot('optimize/bundles')),
+    bundleDir: Joi.string().default(join(getData(), 'optimize')),
     viewCaching: Joi.boolean().default(Joi.ref('$prod')),
     watch: Joi.boolean().default(false),
     watchPort: Joi.number().default(5602),
diff --git a/src/optimize/base_optimizer.js b/src/optimize/base_optimizer.js
index 99e57f007effff..b5a9029015538d 100644
--- a/src/optimize/base_optimizer.js
+++ b/src/optimize/base_optimizer.js
@@ -212,7 +212,7 @@ export default class BaseOptimizer {
     /**
      * Adds a cache loader if we're running in dev mode. The reason we're not adding
      * the cache-loader when running in production mode is that it creates cache
-     * files in optimize/.cache that are not necessary for distributable versions
+     * files in data/optimize/.cache that are not necessary for distributable versions
      * of Kibana and just make compressing and extracting it more difficult.
      */
     const maybeAddCacheLoader = (cacheName, loaders) => {
diff --git a/src/setup_node_env/babel_register/register.js b/src/setup_node_env/babel_register/register.js
index 900e5881aaa1bb..354bdc066432a3 100644
--- a/src/setup_node_env/babel_register/register.js
+++ b/src/setup_node_env/babel_register/register.js
@@ -22,7 +22,7 @@ var resolve = require('path').resolve;
 // this must happen before `require('@babel/register')` and can't be changed
 // once the module has been loaded
 if (!process.env.BABEL_CACHE_PATH) {
-  process.env.BABEL_CACHE_PATH = resolve(__dirname, '../../../optimize/.babel_register_cache.json');
+  process.env.BABEL_CACHE_PATH = resolve(__dirname, '../../../data/optimize/.babel_register_cache.json');
 }
 
 // paths that @babel/register should ignore
diff --git a/tasks/config/run.js b/tasks/config/run.js
index 99743847d2703f..bc9d61458cbc68 100644
--- a/tasks/config/run.js
+++ b/tasks/config/run.js
@@ -208,7 +208,7 @@ module.exports = function (grunt) {
         '--no-base-path',
         '--optimize.watchPort=5611',
         '--optimize.watchPrebuild=true',
-        '--optimize.bundleDir=' + resolve(__dirname, '../../optimize/testdev'),
+        '--optimize.bundleDir=' + resolve(__dirname, '../../data/optimize/testdev'),
       ]
     }),