From Fedora Project Wiki
Fedora Atomic Host installations use the rpm-ostree deployment method, and do not use RPM-based package management at all. Consequently, they do not use the DNF system upgrade mechanism which is used to upgrade between Fedora releases for other Fedora installations. Instead, use the procedure described here.
One OSTree repository per release
It's crucial to note that at the moment, Fedora uses separate OSTree repositories for each major release. This makes switching between versions more painful. For more information, see this ticket.
It's crucial to note that at the moment, Fedora uses separate OSTree repositories for each major release. This makes switching between versions more painful. For more information, see this ticket.
Let's assume you're upgrading from Fedora 40 to 41. First, you'll need to add a remote for the new major version:
ostree remote add fedora-41 --set=gpg-verify=false https://dl.fedoraproject.org/pub/fedora/linux/atomic/41
Then, rebase to it:
rpm-ostree rebase fedora-41:fedora-atomic/f41/x86_64/docker-host
That should be all!