The disclosed embodiments disclose techniques that facilitate the recovery of a virtual machine using a distributed filesystem. Two or more cloud controllers collectively manage distributed filesystem data that is stored in one or more cloud storage systems; the cloud controllers ensure data consistency for the stored data, and each cloud controller caches portions of the distributed filesystem in a local storage pool. During operation, a host server executes program instructions for an application in a virtual machine (VM); data associated with this application and/or this virtual machine is stored in the distributed filesystem. Upon detecting a subsequent failure, the system can recover and resume the execution of the virtual machine and application using the previous application and virtual machine data that was stored in the distributed filesystem.