diff --git a/python/llm/example/transformers/transformers_int4/README.md b/python/llm/example/transformers/transformers_int4/README.md
index 1eadcde1..79e23fd1 100644
--- a/python/llm/example/transformers/transformers_int4/README.md
+++ b/python/llm/example/transformers/transformers_int4/README.md
@@ -12,6 +12,7 @@ You can use BigDL-LLM to run any Huggingface Transformer models with INT4 optimi
 | ChatGLM2  | [link](chatglm2)  | 
 | MOSS      | [link](moss)      | 
 | Baichuan  | [link](baichuan)  | 
+| Baichuan2 | [link](baichuan2) | 
 | Dolly-v1  | [link](dolly_v1)  | 
 | Dolly-v2  | [link](dolly_v2)  | 
 | RedPajama | [link](redpajama) | 
diff --git a/python/llm/example/transformers/transformers_int4/baichuan2/README.md b/python/llm/example/transformers/transformers_int4/baichuan2/README.md
new file mode 100644
index 00000000..ff55c3de
--- /dev/null
+++ b/python/llm/example/transformers/transformers_int4/baichuan2/README.md
@@ -0,0 +1,68 @@
+# Baichuan
+In this directory, you will find examples on how you could apply BigDL-LLM INT4 optimizations on Baichuan2 models. For illustration purposes, we utilize the [baichuan-inc/Baichuan2-13B-Chat](https://huggingface.co/baichuan-inc/Baichuan2-13B-Chat) as a reference Baichuan model.
+
+## 0. Requirements
+To run these examples with BigDL-LLM, we have some recommended requirements for your machine, please refer to [here](../README.md#recommended-requirements) for more information.
+
+## Example: Predict Tokens using `generate()` API
+In the example [generate.py](./generate.py), we show a basic use case for a Baichuan model to predict the next N tokens using `generate()` API, with BigDL-LLM INT4 optimizations.
+### 1. Install
+We suggest using conda to manage environment:
+```bash
+conda create -n llm python=3.9
+conda activate llm
+
+pip install bigdl-llm[all] # install bigdl-llm with 'all' option
+pip install transformers_stream_generator  # additional package required for Baichuan-13B-Chat to conduct generation
+```
+
+### 2. Run
+```
+python ./generate.py --repo-id-or-model-path REPO_ID_OR_MODEL_PATH --prompt PROMPT --n-predict N_PREDICT
+```
+
+Arguments info:
+- `--repo-id-or-model-path REPO_ID_OR_MODEL_PATH`: argument defining the huggingface repo id for the Baichuan2 model to be downloaded, or the path to the huggingface checkpoint folder. It is default to be `'baichuan-inc/Baichuan2-13B-Chat'`.
+- `--prompt PROMPT`: argument defining the prompt to be infered (with integrated prompt format for chat). It is default to be `'AI是什么？'`.
+- `--n-predict N_PREDICT`: argument defining the max number of tokens to predict. It is default to be `32`.
+
+> **Note**: When loading the model in 4-bit, BigDL-LLM converts linear layers in the model into INT4 format. In theory, a *X*B model saved in 16-bit will requires approximately 2*X* GB of memory for loading, and ~0.5*X* GB memory for further inference.
+>
+> Please select the appropriate size of the Baichuan model based on the capabilities of your machine.
+
+#### 2.1 Client
+On client Windows machine, it is recommended to run directly with full utilization of all cores:
+```powershell
+python ./generate.py 
+```
+
+#### 2.2 Server
+For optimal performance on server, it is recommended to set several environment variables (refer to [here](../README.md#best-known-configuration-on-linux) for more information), and run the example with all the physical cores of a single socket.
+
+E.g. on Linux,
+```bash
+# set BigDL-Nano env variables
+source bigdl-nano-init
+
+# e.g. for a server with 48 cores per socket
+export OMP_NUM_THREADS=48
+numactl -C 0-47 -m 0 python ./generate.py
+```
+
+#### 2.3 Sample Output
+#### [baichuan-inc/Baichuan2-13B-Chat](https://huggingface.co/baichuan-inc/Baichuan2-13B-Chat)
+```log
+Inference time: xxxx s
+-------------------- Prompt --------------------
+<human>AI是什么？ <bot>
+-------------------- Output --------------------
+<human>AI是什么？ <bot>人工智能（AI）是指由计算机系统或其他数字设备模拟、扩展和增强人类智能的科学和技术。它涉及到多个领域，如机器学习、计算机视觉、
+```
+
+```log
+Inference time: xxxx s
+-------------------- Prompt --------------------
+<human>解释一下“温故而知新” <bot>
+-------------------- Output --------------------
+<human>解释一下“温故而知新” <bot>这句话出自《论语·为政》篇，意思是通过回顾过去的事情来获取新的理解和认识。简单来说就是：温习学过的知识，可以从中
+```
diff --git a/python/llm/example/transformers/transformers_int4/baichuan2/generate.py b/python/llm/example/transformers/transformers_int4/baichuan2/generate.py
new file mode 100644
index 00000000..1ff4812e
--- /dev/null
+++ b/python/llm/example/transformers/transformers_int4/baichuan2/generate.py
@@ -0,0 +1,69 @@
+#
+# Copyright 2016 The BigDL Authors.
+#
+# Licensed under the Apache License, Version 2.0 (the "License");
+# you may not use this file except in compliance with the License.
+# You may obtain a copy of the License at
+#
+#     http://www.apache.org/licenses/LICENSE-2.0
+#
+# Unless required by applicable law or agreed to in writing, software
+# distributed under the License is distributed on an "AS IS" BASIS,
+# WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+# See the License for the specific language governing permissions and
+# limitations under the License.
+#
+
+import torch
+import time
+import argparse
+import numpy as np
+
+from bigdl.llm.transformers import AutoModelForCausalLM
+from transformers import AutoTokenizer
+
+# you could tune the prompt based on your own model,
+BAICHUAN_PROMPT_FORMAT = "<human>{prompt} <bot>"
+
+if __name__ == '__main__':
+    parser = argparse.ArgumentParser(description='Predict Tokens using `generate()` API for Baichuan model')
+    parser.add_argument('--repo-id-or-model-path', type=str, default="baichuan-inc/Baichuan2-13B-Chat",
+                        help='The huggingface repo id for the Baichuan model to be downloaded'
+                             ', or the path to the huggingface checkpoint folder')
+    parser.add_argument('--prompt', type=str, default="AI是什么？",
+                        help='Prompt to infer')
+    parser.add_argument('--n-predict', type=int, default=32,
+                        help='Max tokens to predict')
+
+    args = parser.parse_args()
+    model_path = args.repo_id_or_model_path
+
+    # Load model in 4 bit,
+    # which convert the relevant layers in the model into INT4 format
+    # if your selected model is capable of utilizing previous key/value attentions
+    # to enhance decoding speed, but has `"use_cache": false` in its model config,
+    # it is important to set `use_cache=True` explicitly in the `generate` function
+    # to obtain optimal performance with BigDL-LLM INT4 optimizations
+    model = AutoModelForCausalLM.from_pretrained(model_path,
+                                                 load_in_4bit=True,
+                                                 trust_remote_code=True,
+                                                 use_cache=True)
+
+    # Load tokenizer
+    tokenizer = AutoTokenizer.from_pretrained(model_path,
+                                              trust_remote_code=True)
+
+    # Generate predicted tokens
+    with torch.inference_mode():
+        prompt = BAICHUAN_PROMPT_FORMAT.format(prompt=args.prompt)
+        input_ids = tokenizer.encode(prompt, return_tensors="pt")
+        st = time.time()
+        output = model.generate(input_ids,
+                                max_new_tokens=args.n_predict)
+        end = time.time()
+        output_str = tokenizer.decode(output[0], skip_special_tokens=True)
+        print(f'Inference time: {end-st} s')
+        print('-'*20, 'Prompt', '-'*20)
+        print(prompt)
+        print('-'*20, 'Output', '-'*20)
+        print(output_str)