diff --git a/.gitignore b/.gitignore
index 49eb116..faece1c 100644
--- a/.gitignore
+++ b/.gitignore
@@ -5,3 +5,5 @@ dist/
 dist-newstyle/
 cabal.project.local
 
+*.swp
+
diff --git a/src/haskell/test/Arion/NixSpec.hs b/src/haskell/test/Arion/NixSpec.hs
index e20bebf..8f0c25e 100644
--- a/src/haskell/test/Arion/NixSpec.hs
+++ b/src/haskell/test/Arion/NixSpec.hs
@@ -13,19 +13,34 @@ import qualified Data.Text                     as T
 import qualified Data.Text.IO                  as T
 
 spec :: Spec
-spec = describe "evaluateComposition" $ it "matches an example" $ do
-  x <- Arion.Nix.evaluateComposition EvaluationArgs
-    { evalUid      = 123
-    , evalModules  = NEL.fromList
-                       ["src/haskell/testdata/Arion/NixSpec/arion-compose.nix"]
-    , evalPkgs     = "import <nixpkgs> { system = \"x86_64-linux\"; }"
-    , evalWorkDir  = Nothing
-    , evalMode     = ReadOnly
-    , evalUserArgs = ["--show-trace"]
-    }
-  let actual = pretty x
-  expected <- T.readFile "src/haskell/testdata/Arion/NixSpec/arion-compose.json"
-  censorPaths actual `shouldBe` censorPaths expected
+spec = describe "evaluateComposition" $ do
+  it "matches an example" $ do
+    x <- Arion.Nix.evaluateComposition EvaluationArgs
+      { evalUid      = 123
+      , evalModules  = NEL.fromList
+                         ["src/haskell/testdata/Arion/NixSpec/arion-compose.nix"]
+      , evalPkgs     = "import <nixpkgs> { system = \"x86_64-linux\"; }"
+      , evalWorkDir  = Nothing
+      , evalMode     = ReadOnly
+      , evalUserArgs = ["--show-trace"]
+      }
+    let actual = pretty x
+    expected <- T.readFile "src/haskell/testdata/Arion/NixSpec/arion-compose.json"
+    censorPaths actual `shouldBe` censorPaths expected
+
+  it "matches an build.context example" $ do
+    x <- Arion.Nix.evaluateComposition EvaluationArgs
+      { evalUid      = 1234
+      , evalModules  = NEL.fromList
+                         ["src/haskell/testdata/Arion/NixSpec/arion-context-compose.nix"]
+      , evalPkgs     = "import <nixpkgs> { system = \"x86_64-linux\"; }"
+      , evalWorkDir  = Nothing
+      , evalMode     = ReadOnly
+      , evalUserArgs = ["--show-trace"]
+      }
+    let actual = pretty x
+    expected <- T.readFile "src/haskell/testdata/Arion/NixSpec/arion-context-compose.json"
+    censorPaths actual `shouldBe` censorPaths expected
 
 censorPaths :: Text -> Text
 censorPaths = censorImages . censorStorePaths
diff --git a/src/haskell/test/Spec.hs b/src/haskell/test/Spec.hs
index d2da234..06d3acc 100644
--- a/src/haskell/test/Spec.hs
+++ b/src/haskell/test/Spec.hs
@@ -9,3 +9,4 @@ import qualified Arion.NixSpec
 spec :: Spec
 spec = do
   describe "Arion.Nix" Arion.NixSpec.spec
+
diff --git a/src/haskell/testdata/Arion/NixSpec/arion-context-compose.json b/src/haskell/testdata/Arion/NixSpec/arion-context-compose.json
new file mode 100644
index 0000000..ae67f53
--- /dev/null
+++ b/src/haskell/testdata/Arion/NixSpec/arion-context-compose.json
@@ -0,0 +1,41 @@
+{
+    "networks": {
+        "default": {
+            "name": "unit-test-data"
+        }
+    },
+    "services": {
+        "webserver": {
+            "build": {
+                "context": "<STOREPATH>"
+            },
+            "environment": {},
+            "ports": [
+                "8080:80"
+            ],
+            "sysctls": {},
+            "volumes": []
+        }
+    },
+    "version": "3.4",
+    "volumes": {},
+    "x-arion": {
+        "images": [
+            {
+                "imageExe": "<STOREPATH>",
+                "imageName": "localhost/webserver",
+                "imageTag": "<HASH>"
+            }
+        ],
+        "project": {
+            "name": "unit-test-data"
+        },
+        "serviceInfo": {
+            "webserver": {
+                "defaultExec": [
+                    "/bin/sh"
+                ]
+            }
+        }
+    }
+}
diff --git a/src/haskell/testdata/Arion/NixSpec/arion-context-compose.nix b/src/haskell/testdata/Arion/NixSpec/arion-context-compose.nix
new file mode 100644
index 0000000..a4c5b7c
--- /dev/null
+++ b/src/haskell/testdata/Arion/NixSpec/arion-context-compose.nix
@@ -0,0 +1,9 @@
+{
+  project.name = "unit-test-data";
+  services.webserver.service = {
+    build.context = "${./build-context}";
+    ports = [
+      "8080:80"
+    ];
+  };
+}
diff --git a/src/haskell/testdata/Arion/NixSpec/build-context/Dockerfile b/src/haskell/testdata/Arion/NixSpec/build-context/Dockerfile
new file mode 100644
index 0000000..d2ba487
--- /dev/null
+++ b/src/haskell/testdata/Arion/NixSpec/build-context/Dockerfile
@@ -0,0 +1,4 @@
+FROM nginx
+
+RUN echo this is a dockerfile to be built
+
diff --git a/src/nix/modules/service/docker-compose-service.nix b/src/nix/modules/service/docker-compose-service.nix
index 061ae8b..c038ac6 100644
--- a/src/nix/modules/service/docker-compose-service.nix
+++ b/src/nix/modules/service/docker-compose-service.nix
@@ -86,7 +86,8 @@ in
       description = serviceRef "environment";
     };
     service.image = mkOption {
-      type = str;
+      type = nullOr str;
+      default = null;
       description = serviceRef "image";
     };
     service.command = mkOption {
@@ -328,8 +329,9 @@ in
       volumes
       environment
       sysctls
-      image
       ;
+  } // lib.optionalAttrs (config.service.image != null) {
+    inherit (config.service) image;
   } // lib.optionalAttrs (config.service.build.context != null) {
     inherit (config.service) build;
   } // lib.optionalAttrs (cap_add != []) {
diff --git a/src/nix/modules/service/image.nix b/src/nix/modules/service/image.nix
index 706a5c1..ae5d214 100644
--- a/src/nix/modules/service/image.nix
+++ b/src/nix/modules/service/image.nix
@@ -163,17 +163,19 @@ in
       '';
     };
   };
-  config = {
-    build.image = builtImage;
-    build.imageName = config.build.image.imageName;
-    build.imageTag =
-                 if config.build.image.imageTag != ""
-                 then config.build.image.imageTag
-                 else lib.head (lib.strings.splitString "-" (baseNameOf config.build.image.outPath));
-
-    service.image = lib.mkDefault "${config.build.imageName}:${config.build.imageTag}";
-    image.rawConfig.Cmd = config.image.command;
-
-    image.nixBuild = lib.mkDefault (priorityIsDefault options.service.image);
-  };
+  config = lib.mkMerge [{
+      build.image = builtImage;
+      build.imageName = config.build.image.imageName;
+      build.imageTag =
+                   if config.build.image.imageTag != ""
+                   then config.build.image.imageTag
+                   else lib.head (lib.strings.splitString "-" (baseNameOf config.build.image.outPath));
+      image.rawConfig.Cmd = config.image.command;
+      image.nixBuild = lib.mkDefault (priorityIsDefault options.service.image);
+    }
+    ( lib.mkIf (config.service.build.context == null)
+    {
+      service.image = lib.mkDefault "${config.build.imageName}:${config.build.imageTag}";
+    })
+  ];
 }
diff --git a/tests/arion-test/default.nix b/tests/arion-test/default.nix
index 75f940d..f8ba4c3 100644
--- a/tests/arion-test/default.nix
+++ b/tests/arion-test/default.nix
@@ -29,7 +29,7 @@ in
       enable = true;
       dockerSocket.enable = true;
     };
-    
+
     # no caches, because no internet
     nix.settings.substituters = lib.mkForce [];