diff --git a/src/fprime/fbuild/settings.py b/src/fprime/fbuild/settings.py
index dc13a7ad..5ae3b70e 100644
--- a/src/fprime/fbuild/settings.py
+++ b/src/fprime/fbuild/settings.py
@@ -16,6 +16,37 @@
 from typing import Any, Callable, Dict, List, Union
 
 
+class EnvironmentVariableInterpolation(configparser.BasicInterpolation):
+    """Interpolation for environment variables embedded in setting.ini
+
+    settings.ini will extrapolate $/${} as an environment variable. This will allow basic environment variable
+    replacement. It is illegal to supply an environment variable with a $ or %( as part of the value because that might
+    trigger unanticipated recursive parsing.
+
+    Note: environment variable substitution is only performed in the environment section and nowhere else.
+
+    Based off: https://stackoverflow.com/questions/26586801/configparser-and-string-interpolation-with-env-variable
+    """
+
+    def before_get(self, parser, section, option, value, defaults):
+        """Pre-process sections to replace environment variables
+
+        Runs before the value is gotten to replace environment variables. It will use os.path.expandvars to do the
+        actual substitution on any value in the "environment" section. Other pre-processing is done first.
+
+        Args:
+            parser: unused
+            section: environment substitution will be done only when set to "environment"
+            option: unused
+            value: will be searched for and replace environment variables
+            defaults: unused
+        Returns:
+            the value post substitution
+        """
+        value = super().before_get(parser, section, option, value, defaults)
+        return os.path.expandvars(value) if section == "environment" else value
+
+
 class SettingType(Enum):
     """Designates the type of the setting"""
 
@@ -171,7 +202,9 @@ def load(settings_file: Path, platform: str = "native", is_ut: bool = False):
         # Setup a config parser, or none if the settings file does not exist
         confparse = None
         if settings_file.exists():
-            confparse = configparser.ConfigParser()
+            confparse = configparser.ConfigParser(
+                interpolation=EnvironmentVariableInterpolation()
+            )
             confparse.read(settings_file)
         else:
             print(f"[WARNING] {settings_file} does not exist", file=sys.stderr)
@@ -235,7 +268,9 @@ def load_environment(env_file):
         :param env_file: load environment from this file
         :return: environment dictionary
         """
-        parser = configparser.ConfigParser()
+        parser = configparser.ConfigParser(
+            interpolation=EnvironmentVariableInterpolation()
+        )
         parser.optionxform = str
         parser.read(env_file)
         env_dict = {}
diff --git a/test/fprime/fbuild/settings-data/settings-environment.ini b/test/fprime/fbuild/settings-data/settings-environment.ini
new file mode 100644
index 00000000..8d698691
--- /dev/null
+++ b/test/fprime/fbuild/settings-data/settings-environment.ini
@@ -0,0 +1,6 @@
+[fprime]
+framework_path: ../..
+
+[environment]
+MY_VARIABLE: my value
+MY_VARIABLE_2: ${TEST_SETTING_1}:$TEST_SETTING_2
diff --git a/test/fprime/fbuild/test_settings.py b/test/fprime/fbuild/test_settings.py
index 8de2bef0..3fcb1f06 100644
--- a/test/fprime/fbuild/test_settings.py
+++ b/test/fprime/fbuild/test_settings.py
@@ -4,7 +4,7 @@
 Tests the F prime settings module.
 @author joshuaa
 """
-
+import os
 from pathlib import Path
 
 from fprime.fbuild.settings import IniSettings
@@ -126,8 +126,28 @@ def test_settings():
                 "default_cmake_options": "OPTION1=ABC\nOPTION2=123\nOPTION3=Something",
             },
         },
+        {
+            "file": "settings-environment.ini",
+            "expected": {
+                "settings_file": full_path("settings-data/settings-environment.ini"),
+                "default_toolchain": "native",
+                "default_ut_toolchain": "native",
+                "framework_path": full_path(".."),
+                "install_destination": full_path("settings-data/build-artifacts"),
+                "library_locations": [],
+                "environment_file": full_path("settings-data/settings-environment.ini"),
+                "environment": {"MY_VARIABLE": "my value", "MY_VARIABLE_2": "abc:123"},
+                "component_cookiecutter": "default",
+                "deployment_cookiecutter": "default",
+                "project_root": full_path(".."),
+                "config_directory": full_path("..") / "config",
+                "default_cmake_options": "",
+            },
+        },
     ]
-
+    # Prep for substitution
+    os.environ["TEST_SETTING_1"] = "abc"
+    os.environ["TEST_SETTING_2"] = "123"
     for case in test_cases:
         fp = full_path("settings-data/" + case["file"])
         results = IniSettings.load(fp)