Dimitrios Liappis details a process for creating a custom Amazon Machine Image (AMI) from a virtualization source such as a VirtualBox .vmdk file, which can be particularly useful when existing public AMIs do not meet specific needs. The procedure involves configuring a virtual machine with necessary tools like cloud-init and uploading the VM image to an S3 bucket for conversion using AWS ImportImage. Essential prerequisites include defining an S3 bucket, setting appropriate AWS roles and policies, and ensuring fast upload bandwidth. Liappis also introduces a tool called amiimport.py to automate this process, particularly for Vagrant boxes, by handling tasks such as uploading images and creating AMIs across multiple regions. The guide emphasizes security considerations, such as changing default passwords in Vagrant boxes, and acknowledges the challenges of resizing root partitions, suggesting that the automation tool could simplify the conversion process.