diff --git a/README.md b/README.md
index b8e7e7e8..7beb8e06 100644
--- a/README.md
+++ b/README.md
@@ -293,6 +293,27 @@ These commands are intended to be run as part of build systems / deployment pipe
 
 They don't have interactive prompts, you can expect fewer changes to them, and backwards compatibility is much more important than with the interactive commands above.
 
+## Environment variables
+
+`cfbs` respects the following environment variables:
+
+- `CFBS_GLOBAL_DIR`: Directory where `cfbs` stores global information, such as its cache of downloaded modules.
+  - **Default:** `~/.cfengine/cfbs/`.
+  - **Usage:** `CFBS_GLOBAL_DIR=/tmp/cfbs cfbs build`.
+  - **Note:** `cfbs` still uses the current working directory for finding and building a project (`./cfbs.json`, `./out/`, etc.).
+
+Additionally, `cfbs` runs some commands in a shell, utilizing a few programs / shell built-ins, which may be affected by environment variables:
+
+- `git`
+- `tar`
+- `unzip`
+- `rsync`
+- `mv`
+- `cat`
+- `cd`
+- `rm`
+- Commands / scripts specified in the `run` build step.
+
 ## The cfbs.json format
 
 More advanced users and module authors may need to understand, write, or edit `cfbs.json` files.
diff --git a/cfbs/utils.py b/cfbs/utils.py
index 63a6f51d..43afb4f3 100644
--- a/cfbs/utils.py
+++ b/cfbs/utils.py
@@ -198,7 +198,17 @@ def cfengine_dir(subdir=None):
 
 
 def cfbs_dir(append=None) -> str:
-    return os.path.join(cfengine_dir("cfbs"), append if append else "")
+    directory = os.getenv("CFBS_GLOBAL_DIR")
+    if directory:
+        # Env var was set, make it absolute,
+        # same as in cfengine_dir() / path_append() above.
+        directory = os.path.abspath(os.path.expanduser(directory))
+    else:
+        # Env var not set, use default.
+        directory = cfengine_dir("cfbs")  # Already absolute
+    if not append:
+        return directory
+    return os.path.join(directory, append)
 
 
 class FetchError(Exception):
diff --git a/tests/shell/038_global_dir.sh b/tests/shell/038_global_dir.sh
new file mode 100644
index 00000000..40caffac
--- /dev/null
+++ b/tests/shell/038_global_dir.sh
@@ -0,0 +1,58 @@
+set -e
+set -x
+cd tests/
+mkdir -p ./tmp/
+cd ./tmp/
+rm -rf ./*
+
+# Try to be nice to the user - back up and restore their
+# module cache (~/.cfengine/cfbs/downloads):
+
+cleanup_restore_backup()
+{
+  if [ -d ~/.cfengine/cfbs_backup ]; then
+    if [ -d ~/.cfengine/cfbs ]; then
+      # Should be okay to delete this - it's created by a bug in cfbs or this test
+      # the "real" data we care about is in downloads_backup
+      rm -rf ~/.cfengine/cfbs
+    fi
+    echo "Restoring backup"
+    mv ~/.cfengine/cfbs_backup ~/.cfengine/cfbs
+  fi
+}
+
+if [ -d ~/.cfengine/cfbs ]; then # Global dir used by cfbs by default
+  if [ -d ~/.cfengine/cfbs_backup ]; then # Backup dir used by this test
+    echo "Warning: Removing previous backup in" ~/.cfengine/cfbs_backup
+    rm -rf ~/.cfengine/cfbs_backup
+  fi
+  # Setting the trap here, after determining that we need to backup and
+  # after potentially deleting an older backup, so we don't end up
+  # restoring a backup which was not created in this test run:
+  trap cleanup_restore_backup EXIT ERR SIGHUP SIGINT SIGQUIT SIGABRT
+  mv ~/.cfengine/cfbs ~/.cfengine/cfbs_backup
+fi
+
+test ! -e ./out/cfbs_global/
+test ! -e ~/.cfengine/cfbs
+
+# CFBS_GLOBAL_DIR allows us to override ~/.cfengine/cfbs with
+# another path, for example for situations where you want to run
+# cfbs as root, but not having access to root's home directory:
+CFBS_GLOBAL_DIR="./out/cfbs_global" cfbs --non-interactive init
+CFBS_GLOBAL_DIR="./out/cfbs_global" cfbs download
+
+# Check that something was downloaded in the correct place:
+ls ./out/cfbs_global/downloads/github.com/cfengine/masterfiles/*
+# And nothing was downloaded or created in the wrong place:
+test ! -e ~/.cfengine/cfbs
+
+# Test some other commands, just in case:
+rm -rf "./out/cfbs_global"
+CFBS_GLOBAL_DIR="./out/cfbs_global" cfbs status
+CFBS_GLOBAL_DIR="./out/cfbs_global" cfbs download
+CFBS_GLOBAL_DIR="./out/cfbs_global" cfbs build
+
+# Same checks as above:
+ls ./out/cfbs_global/downloads/github.com/cfengine/masterfiles/*
+test ! -e ~/.cfengine/cfbs
diff --git a/tests/shell/all.sh b/tests/shell/all.sh
index 778f4075..c6b55ec2 100644
--- a/tests/shell/all.sh
+++ b/tests/shell/all.sh
@@ -41,5 +41,6 @@ bash tests/shell/034_git_user_name_git_user_email.sh
 bash tests/shell/035_cfbs_build_compatibility_1.sh
 bash tests/shell/036_cfbs_build_compatibility_2.sh
 bash tests/shell/037_cfbs_validate.sh
+bash tests/shell/038_global_dir.sh
 
 echo "All cfbs shell tests completed successfully!"