diff --git a/src/include/daos/object.h b/src/include/daos/object.h
index 71cc6c5ca8c..e23196e3e70 100644
--- a/src/include/daos/object.h
+++ b/src/include/daos/object.h
@@ -240,8 +240,9 @@ int daos_obj_set_oid_by_class(daos_obj_id_t *oid, enum daos_otype_t type,
 unsigned int daos_oclass_grp_size(struct daos_oclass_attr *oc_attr);
 unsigned int daos_oclass_grp_nr(struct daos_oclass_attr *oc_attr,
 				struct daos_obj_md *md);
-int daos_oclass_fit_max(daos_oclass_id_t oc_id, int domain_nr, int target_nr,
-			enum daos_obj_redun *ord, uint32_t *nr);
+int
+daos_oclass_fit_max(daos_oclass_id_t oc_id, int domain_nr, int target_nr, enum daos_obj_redun *ord,
+		    uint32_t *nr, uint32_t rf_factor);
 bool daos_oclass_is_valid(daos_oclass_id_t oc_id);
 int daos_obj_get_oclass(daos_handle_t coh, enum daos_otype_t type, daos_oclass_hints_t hints,
 			uint32_t args, daos_oclass_id_t *cid);
diff --git a/src/object/cli_obj.c b/src/object/cli_obj.c
index c36306ba8c8..4e8b9634c94 100644
--- a/src/object/cli_obj.c
+++ b/src/object/cli_obj.c
@@ -7174,6 +7174,7 @@ daos_obj_generate_oid(daos_handle_t coh, daos_obj_id_t *oid,
 	uint32_t		nr_grp;
 	struct cont_props	props;
 	int			rc;
+	uint32_t		 rf;
 	struct dc_cont		*dc;
 
 	if (!daos_otype_t_is_valid(type))
@@ -7199,18 +7200,17 @@ daos_obj_generate_oid(daos_handle_t coh, daos_obj_id_t *oid,
 	rc = pl_map_query(pool->dp_pool, &attr);
 	D_ASSERT(rc == 0);
 	dc_pool_put(pool);
+	rf = dc->dc_props.dcp_redun_fac;
 
-	D_DEBUG(DB_TRACE, "available domain=%d, targets=%d\n",
-		attr.pa_domain_nr, attr.pa_target_nr);
+	D_DEBUG(DB_TRACE, "available domain=%d, targets=%d rf:%u\n", attr.pa_domain_nr,
+		attr.pa_target_nr, rf);
 
 	if (cid == OC_UNKNOWN) {
-		uint32_t rf;
-
-		rf = dc->dc_props.dcp_redun_fac;
 		rc = dc_set_oclass(rf, attr.pa_domain_nr, attr.pa_target_nr, type, hints, &ord,
 				   &nr_grp);
 	} else {
-		rc = daos_oclass_fit_max(cid, attr.pa_domain_nr, attr.pa_target_nr, &ord, &nr_grp);
+		rc = daos_oclass_fit_max(cid, attr.pa_domain_nr, attr.pa_target_nr, &ord, &nr_grp,
+					 rf);
 	}
 	dc_cont_put(dc);
 
@@ -7263,8 +7263,8 @@ daos_obj_generate_oid_by_rf(daos_handle_t poh, uint64_t rf_factor,
 				   attr.pa_target_nr, type, hints, &ord,
 				   &nr_grp);
 	else
-		rc = daos_oclass_fit_max(cid, attr.pa_domain_nr,
-					 attr.pa_target_nr, &ord, &nr_grp);
+		rc = daos_oclass_fit_max(cid, attr.pa_domain_nr, attr.pa_target_nr, &ord, &nr_grp,
+					 rf_factor);
 	if (rc)
 		return rc;
 
diff --git a/src/object/obj_class.c b/src/object/obj_class.c
index cbb2931dfe1..f533ccd7417 100644
--- a/src/object/obj_class.c
+++ b/src/object/obj_class.c
@@ -1,5 +1,5 @@
 /**
- * (C) Copyright 2016-2022 Intel Corporation.
+ * (C) Copyright 2016-2023 Intel Corporation.
  *
  * SPDX-License-Identifier: BSD-2-Clause-Patent
  */
@@ -234,9 +234,24 @@ daos_oclass_grp_nr(struct daos_oclass_attr *oc_attr, struct daos_obj_md *md)
 	return oc_attr->ca_grp_nr;
 }
 
+/**
+ * To honor RF setting during failure cases, let's reserve RF
+ * groups, so if some targets fail, there will be enough replacement
+ * targets to rebuild, so to avoid putting multiple shards in the same
+ * domain, which may break the RF setting.
+ *
+ * Though let's keep reserve targets to be less than 30% of the total
+ * targets.
+ */
+static uint32_t
+reserve_grp_by_rf(uint32_t target_nr, uint32_t grp_size, uint32_t rf)
+{
+	return min(((target_nr * 3) / 10) / grp_size, rf);
+}
+
 int
-daos_oclass_fit_max(daos_oclass_id_t oc_id, int domain_nr, int target_nr,
-		    enum daos_obj_redun *ord, uint32_t *nr)
+daos_oclass_fit_max(daos_oclass_id_t oc_id, int domain_nr, int target_nr, enum daos_obj_redun *ord,
+		    uint32_t *nr, uint32_t rf_factor)
 {
 	struct daos_obj_class	*oc;
 	struct daos_oclass_attr	 ca;
@@ -270,9 +285,14 @@ daos_oclass_fit_max(daos_oclass_id_t oc_id, int domain_nr, int target_nr,
 	}
 
 	grp_size = daos_oclass_grp_size(&ca);
-	if (ca.ca_grp_nr == DAOS_OBJ_GRP_MAX)
+	if (ca.ca_grp_nr == DAOS_OBJ_GRP_MAX) {
+		uint32_t reserve_grp = reserve_grp_by_rf(target_nr, grp_size, rf_factor);
+
 		ca.ca_grp_nr = max(1, (target_nr / grp_size));
 
+		if (ca.ca_grp_nr > reserve_grp)
+			ca.ca_grp_nr -= reserve_grp;
+	}
 	if (grp_size > domain_nr) {
 		D_ERROR("grp size (%u) (%u) is larger than domain nr (%u)\n",
 			grp_size, DAOS_OBJ_REPL_MAX, domain_nr);
@@ -823,8 +843,13 @@ dc_set_oclass(uint32_t rf, int domain_nr, int target_nr, enum daos_otype_t otype
 	}
 
 	if (grp_nr == DAOS_OBJ_GRP_MAX || grp_nr * grp_size > target_nr) {
+		uint32_t max_grp     = target_nr / grp_size;
+		uint32_t reserve_grp = reserve_grp_by_rf(target_nr, grp_size, rf);
+
 		/* search for the highest scalability in the allowed range */
-		*nr = max(1, (target_nr / grp_size));
+		if (max_grp > reserve_grp)
+			max_grp = max_grp - reserve_grp;
+		*nr = max(1, max_grp);
 	} else {
 		*nr = grp_nr;
 	}