diff --git a/CHANGELOG.md b/CHANGELOG.md
index 1f097e979..19df1b284 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -11,6 +11,8 @@ For now, the playbook only uses that one database (`homeserver`) and that one si
 However, in the future, additional components besides Synapse may also make use the Postgres database server.
 One such example is the [matrix-appservice-slack](https://github.com/matrix-org/matrix-appservice-slack) bridge, which strongly encourages use of Postgres in its v1.0 release. We are yet to upgrade to it.
 
+Additionally, Postgres [upgrading](docs/maintenance-postgres.md#upgrading-postgresql) now uses gzipped dump files by default, to minimize disk space usage.
+
 
 # 2019-10-04
 
diff --git a/docs/maintenance-postgres.md b/docs/maintenance-postgres.md
index 8a6e35fb1..a62b4994c 100644
--- a/docs/maintenance-postgres.md
+++ b/docs/maintenance-postgres.md
@@ -74,4 +74,8 @@ The auto-upgrade-backup directory stays around forever, until you **manually dec
 As part of the upgrade, the database is dumped to `/tmp`, an upgraded and empty Postgres server is started, and then the dump is restored into the new server.
 To use a different directory for the dump, pass some extra flags to the command above, like this: `--extra-vars="postgres_dump_dir=/directory/to/dump/here"`
 
+To save disk space in `/tmp`, the dump file is gzipped on the fly at the expense of CPU usage.
+If you have plenty of space in `/tmp` and would rather avoid gzipping, you can explicitly pass a dump filename which doesn't end in `.gz`.
+Example: `--extra-vars="postgres_dump_name=matrix-postgres-dump.sql"`
+
 **All databases, roles, etc. on the Postgres server are migrated**.
diff --git a/roles/matrix-postgres/tasks/upgrade_postgres.yml b/roles/matrix-postgres/tasks/upgrade_postgres.yml
index 096992dee..9a30e8194 100644
--- a/roles/matrix-postgres/tasks/upgrade_postgres.yml
+++ b/roles/matrix-postgres/tasks/upgrade_postgres.yml
@@ -7,7 +7,7 @@
 
 - name: Set postgres_dump_name, if not provided
   set_fact:
-    postgres_dump_name: "matrix-postgres.out"
+    postgres_dump_name: "matrix-postgres-dump.sql.gz"
   when: "postgres_dump_name|default('') == ''"
 
 - name: Set postgres_auto_upgrade_backup_data_path, if not provided
@@ -81,7 +81,9 @@
     --entrypoint=/bin/sh
     -v {{ postgres_dump_dir }}:/out
     {{ matrix_postgres_detected_version_corresponding_docker_image }}
-    -c "pg_dumpall -h matrix-postgres > /out/{{ postgres_dump_name }}"
+    -c "pg_dumpall -h matrix-postgres
+    {{ '| gzip -c ' if postgres_dump_name.endswith('.gz') else '' }}
+    > /out/{{ postgres_dump_name }}"
 
 - name: Ensure matrix-postgres is stopped
   service:
@@ -125,6 +127,7 @@
       -v {{ postgres_dump_dir }}:/in:ro
       {{ matrix_postgres_docker_image_latest }}
       -c "cat /in/{{ postgres_dump_name }} |
+      {{ 'gunzip |' if postgres_dump_name.endswith('.gz') else '' }}
       grep -vE '^CREATE ROLE {{ matrix_postgres_connection_username }}' |
       grep -vE '^CREATE DATABASE {{ matrix_postgres_db_name }}' |
       psql -v ON_ERROR_STOP=1 -h matrix-postgres"