diff --git a/pkg/services/searchV2/bluge.go b/pkg/services/searchV2/bluge.go
index c546cf00565..7c50005fc9f 100644
--- a/pkg/services/searchV2/bluge.go
+++ b/pkg/services/searchV2/bluge.go
@@ -42,11 +42,31 @@ func initIndex(dashboards []dashboard, logger log.Logger) (*bluge.Reader, *bluge
 	}
 	// Not closing Writer here since we use it later while processing dashboard change events.
 
-	batch := bluge.NewBatch()
-
 	start := time.Now()
 	label := start
 
+	batch := bluge.NewBatch()
+
+	// In order to reduce memory usage while initial indexing we are limiting
+	// the size of batch here.
+	docsInBatch := 0
+	maxBatchSize := 100
+
+	flushIfRequired := func(force bool) error {
+		docsInBatch++
+		needFlush := force || (maxBatchSize > 0 && docsInBatch >= maxBatchSize)
+		if !needFlush {
+			return nil
+		}
+		err := writer.Batch(batch)
+		if err != nil {
+			return err
+		}
+		docsInBatch = 0
+		batch.Reset()
+		return nil
+	}
+
 	// First index the folders to construct folderIdLookup.
 	folderIdLookup := make(map[int64]string, 50)
 	for _, dash := range dashboards {
@@ -55,6 +75,9 @@ func initIndex(dashboards []dashboard, logger log.Logger) (*bluge.Reader, *bluge
 		}
 		doc := getFolderDashboardDoc(dash)
 		batch.Insert(doc)
+		if err := flushIfRequired(false); err != nil {
+			return nil, nil, err
+		}
 		uid := dash.uid
 		if uid == "" {
 			uid = "general"
@@ -71,14 +94,23 @@ func initIndex(dashboards []dashboard, logger log.Logger) (*bluge.Reader, *bluge
 		location := folderUID
 		doc := getNonFolderDashboardDoc(dash, location)
 		batch.Insert(doc)
+		if err := flushIfRequired(false); err != nil {
+			return nil, nil, err
+		}
 
 		// Index each panel in dashboard.
 		location += "/" + dash.uid
 		docs := getDashboardPanelDocs(dash, location)
 		for _, panelDoc := range docs {
 			batch.Insert(panelDoc)
+			if err := flushIfRequired(false); err != nil {
+				return nil, nil, err
+			}
 		}
 	}
+	if err := flushIfRequired(true); err != nil {
+		return nil, nil, err
+	}
 	logger.Info("Finish inserting docs into batch", "elapsed", time.Since(label))
 	label = time.Now()
 
diff --git a/pkg/services/searchV2/index.go b/pkg/services/searchV2/index.go
index 21711a438d3..878943d74bf 100644
--- a/pkg/services/searchV2/index.go
+++ b/pkg/services/searchV2/index.go
@@ -4,6 +4,9 @@ import (
 	"bytes"
 	"context"
 	"fmt"
+	"io/ioutil"
+	"os"
+	"runtime"
 	"strconv"
 	"strings"
 	"sync"
@@ -79,13 +82,10 @@ func (i *dashboardIndex) run(ctx context.Context) error {
 		lastEventID = lastEvent.Id
 	}
 
-	// Build on start for orgID 1 but keep lazy for others.
-	started := time.Now()
-	numDashboards, err := i.buildOrgIndex(ctx, 1)
+	err = i.buildInitialIndex(ctx)
 	if err != nil {
-		return fmt.Errorf("can't build dashboard search index for org ID 1: %w", err)
+		return fmt.Errorf("can't build initial dashboard search index: %w", err)
 	}
-	i.logger.Info("Indexing for main org finished", "mainOrgIndexElapsed", time.Since(started), "numDashboards", numDashboards)
 
 	for {
 		select {
@@ -111,6 +111,93 @@ func (i *dashboardIndex) run(ctx context.Context) error {
 	}
 }
 
+func (i *dashboardIndex) buildInitialIndex(ctx context.Context) error {
+	memCtx, memCancel := context.WithCancel(ctx)
+	if os.Getenv("GF_SEARCH_DEBUG") != "" {
+		go i.debugMemStats(memCtx, 200*time.Millisecond)
+	}
+
+	// Build on start for orgID 1 but keep lazy for others.
+	started := time.Now()
+	numDashboards, err := i.buildOrgIndex(ctx, 1)
+	if err != nil {
+		memCancel()
+		return fmt.Errorf("can't build dashboard search index for org ID 1: %w", err)
+	}
+	i.logger.Info("Indexing for main org finished", "mainOrgIndexElapsed", time.Since(started), "numDashboards", numDashboards)
+	memCancel()
+
+	if os.Getenv("GF_SEARCH_DEBUG") != "" {
+		// May help to estimate size of index when introducing changes. Though it's not a direct
+		// match to a memory consumption, but at least make give some relative difference understanding.
+		// Moreover, changes in indexing can cause additional memory consumption upon initial index build
+		// which is not reflected here.
+		i.reportSizeOfIndexDiskBackup(1)
+	}
+	return nil
+}
+
+func (i *dashboardIndex) debugMemStats(ctx context.Context, frequency time.Duration) {
+	var maxHeapInuse uint64
+	var maxSys uint64
+
+	captureMemStats := func() {
+		var m runtime.MemStats
+		runtime.ReadMemStats(&m)
+		if m.HeapInuse > maxHeapInuse {
+			maxHeapInuse = m.HeapInuse
+		}
+		if m.Sys > maxSys {
+			maxSys = m.Sys
+		}
+	}
+
+	captureMemStats()
+
+	for {
+		select {
+		case <-ctx.Done():
+			i.logger.Warn("Memory stats during indexing", "maxHeapInUse", formatBytes(maxHeapInuse), "maxSys", formatBytes(maxSys))
+			return
+		case <-time.After(frequency):
+			captureMemStats()
+		}
+	}
+}
+
+func (i *dashboardIndex) reportSizeOfIndexDiskBackup(orgID int64) {
+	reader, _ := i.getOrgReader(orgID)
+
+	// create a temp directory to store the index
+	tmpDir, err := ioutil.TempDir("", "grafana.dashboard_index")
+	if err != nil {
+		i.logger.Error("can't create temp dir", "error", err)
+		return
+	}
+	defer func() {
+		err := os.RemoveAll(tmpDir)
+		if err != nil {
+			i.logger.Error("can't remove temp dir", "error", err, "tmpDir", tmpDir)
+			return
+		}
+	}()
+
+	cancel := make(chan struct{})
+	err = reader.Backup(tmpDir, cancel)
+	if err != nil {
+		i.logger.Error("can't create index disk backup", "error", err)
+		return
+	}
+
+	size, err := dirSize(tmpDir)
+	if err != nil {
+		i.logger.Error("can't calculate dir size", "error", err)
+		return
+	}
+
+	i.logger.Warn("Size of index disk backup", "size", formatBytes(uint64(size)))
+}
+
 func (i *dashboardIndex) buildOrgIndex(ctx context.Context, orgID int64) (int, error) {
 	started := time.Now()
 	ctx, cancel := context.WithTimeout(ctx, time.Minute)
diff --git a/pkg/services/searchV2/utils.go b/pkg/services/searchV2/utils.go
new file mode 100644
index 00000000000..a5697e94940
--- /dev/null
+++ b/pkg/services/searchV2/utils.go
@@ -0,0 +1,39 @@
+package searchV2
+
+import (
+	"fmt"
+	"math"
+	"os"
+	"path/filepath"
+)
+
+func dirSize(path string) (int64, error) {
+	var size int64
+	err := filepath.Walk(path, func(_ string, info os.FileInfo, err error) error {
+		if err != nil {
+			return err
+		}
+		if !info.IsDir() {
+			size += info.Size()
+		}
+		return err
+	})
+	return size, err
+}
+
+func logN(n, b float64) float64 {
+	return math.Log(n) / math.Log(b)
+}
+
+// Slightly modified function from https://github.com/dustin/go-humanize (MIT).
+func formatBytes(numBytes uint64) string {
+	base := 1024.0
+	sizes := []string{"B", "KiB", "MiB", "GiB", "TiB", "PiB", "EiB"}
+	if numBytes < 10 {
+		return fmt.Sprintf("%d B", numBytes)
+	}
+	e := math.Floor(logN(float64(numBytes), base))
+	suffix := sizes[int(e)]
+	val := math.Floor(float64(numBytes)/math.Pow(base, e)*10+0.5) / 10
+	return fmt.Sprintf("%.1f %s", val, suffix)
+}