diff --git a/CHANGELOG.md b/CHANGELOG.md
index 50f30141..791bdd3b 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -4,6 +4,10 @@
 
 ## [Unreleased]
 
+### Changed
+
+- Improved handling of environment variables from Aspire host launchSettings file
+
 ## [0.2.1] - 2024-01-05
 
 ### Fixed
diff --git a/gradle.properties b/gradle.properties
index 31cd0603..87e598e0 100644
--- a/gradle.properties
+++ b/gradle.properties
@@ -4,7 +4,7 @@ pluginGroup = me.rafaelldi.aspire
 pluginName = aspire-plugin
 pluginRepositoryUrl = https://github.com/rafaelldi/aspire-plugin
 # SemVer format -> https://semver.org
-pluginVersion = 0.2.1
+pluginVersion = 0.2.2
 
 # Supported build number ranges and IntelliJ Platform versions -> https://plugins.jetbrains.com/docs/intellij/build-number-ranges.html
 pluginSinceBuild = 233
diff --git a/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostConfigurationFactory.kt b/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostConfigurationFactory.kt
index c562389e..ff9d11bd 100644
--- a/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostConfigurationFactory.kt
+++ b/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostConfigurationFactory.kt
@@ -13,7 +13,7 @@ class AspireHostConfigurationFactory(type: AspireHostConfigurationType) :
         this,
         "Aspire Host",
         AspireHostConfigurationParameters(
-            project, "", true, DotNetStartBrowserParameters()
+            project, "", true, hashMapOf(), true, DotNetStartBrowserParameters()
         )
     )
 }
\ No newline at end of file
diff --git a/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostConfigurationParameters.kt b/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostConfigurationParameters.kt
index 30548d19..42c4cca7 100644
--- a/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostConfigurationParameters.kt
+++ b/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostConfigurationParameters.kt
@@ -1,5 +1,6 @@
 package me.rafaelldi.aspire.run
 
+import com.intellij.execution.configuration.EnvironmentVariablesComponent
 import com.intellij.execution.configurations.RunConfiguration
 import com.intellij.execution.configurations.RunProfile
 import com.intellij.execution.configurations.RuntimeConfigurationError
@@ -20,11 +21,14 @@ import org.jdom.Element
 class AspireHostConfigurationParameters(
     private val project: Project,
     var projectFilePath: String,
+    var trackEnvs: Boolean,
+    var envs: Map<String, String>,
     var trackUrl: Boolean,
     var startBrowserParameters: DotNetStartBrowserParameters
 ) {
     companion object {
         private const val PROJECT_FILE_PATH = "PROJECT_FILE_PATH"
+        private const val TRACK_ENVS = "TRACK_ENVS"
         private const val TRACK_URL = "TRACK_URL"
     }
 
@@ -56,6 +60,9 @@ class AspireHostConfigurationParameters(
 
     fun readExternal(element: Element) {
         projectFilePath = JDOMExternalizerUtil.readField(element, PROJECT_FILE_PATH) ?: ""
+        val trackEnvsString = JDOMExternalizerUtil.readField(element, TRACK_ENVS) ?: ""
+        trackEnvs = trackEnvsString != "0"
+        EnvironmentVariablesComponent.readExternal(element, envs)
         val trackUrlString = JDOMExternalizerUtil.readField(element, TRACK_URL) ?: ""
         trackUrl = trackUrlString != "0"
         startBrowserParameters = DotNetStartBrowserParameters.readExternal(element)
@@ -63,6 +70,8 @@ class AspireHostConfigurationParameters(
 
     fun writeExternal(element: Element) {
         JDOMExternalizerUtil.writeField(element, PROJECT_FILE_PATH, projectFilePath)
+        JDOMExternalizerUtil.writeField(element, TRACK_ENVS, if (trackEnvs) "1" else "0")
+        EnvironmentVariablesComponent.writeExternal(element, envs)
         JDOMExternalizerUtil.writeField(element, TRACK_URL, if (trackUrl) "1" else "0")
         startBrowserParameters.writeExternal(element)
     }
@@ -70,8 +79,10 @@ class AspireHostConfigurationParameters(
 
 fun AspireHostConfigurationParameters.setUpFromRunnableProject(project: RunnableProject) {
     projectFilePath = project.projectFilePath
-    trackUrl = true
     val runOptions = project.getRunOptions()
+    trackEnvs = true
+    envs = project.environmentVariables.associate { it.key to it.value }
+    trackUrl = true
     val startBrowserUrl = runOptions.startBrowserUrl
     if (startBrowserUrl.isNotEmpty()) {
         startBrowserParameters.apply {
diff --git a/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostConfigurationViewModel.kt b/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostConfigurationViewModel.kt
index 6da94506..8c4d87e4 100644
--- a/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostConfigurationViewModel.kt
+++ b/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostConfigurationViewModel.kt
@@ -16,6 +16,7 @@ class AspireHostConfigurationViewModel(
     private val lifetime: Lifetime,
     private val runnableProjectsModel: RunnableProjectsModel?,
     val projectSelector: ProjectSelector,
+    val environmentVariablesEditor: EnvironmentVariablesEditor,
     separator: ViewSeparator,
     val urlEditor: TextEditor,
     val dotNetBrowserSettingsEditor: BrowserSettingsEditor
@@ -23,12 +24,15 @@ class AspireHostConfigurationViewModel(
     override val controls: List<ControlBase> =
         listOf(
             projectSelector,
+            environmentVariablesEditor,
             separator,
             urlEditor,
             dotNetBrowserSettingsEditor
         )
 
     private var isLoaded = false
+
+    var trackEnvs = true
     var trackUrl = true
 
     init {
@@ -44,6 +48,7 @@ class AspireHostConfigurationViewModel(
             )
         }
 
+        environmentVariablesEditor.envs.advise(lifetime) { handleEnvValueChange() }
         urlEditor.text.advise(lifetime) { handleUrlValueChange() }
     }
 
@@ -53,6 +58,7 @@ class AspireHostConfigurationViewModel(
         }
 
         val runOptions = project.getRunOptions()
+        environmentVariablesEditor.envs.set(runOptions.environmentVariables)
         val startBrowserUrl = runOptions.startBrowserUrl
         if (startBrowserUrl.isNotEmpty()) {
             urlEditor.defaultValue.value = startBrowserUrl
@@ -61,6 +67,14 @@ class AspireHostConfigurationViewModel(
         }
     }
 
+    private fun handleEnvValueChange() {
+        projectSelector.project.valueOrNull?.let {
+            val envs = it.environmentVariables.associate { pair -> pair.key to pair.value }.toSortedMap()
+            val editorEnvs = environmentVariablesEditor.envs.value.toSortedMap()
+            trackEnvs = envs == editorEnvs
+        }
+    }
+
     private fun handleUrlValueChange() {
         projectSelector.project.valueOrNull?.let {
             val runOptions = it.getRunOptions()
@@ -68,9 +82,16 @@ class AspireHostConfigurationViewModel(
         }
     }
 
-    fun reset(projectFilePath: String, trackUrl: Boolean, dotNetStartBrowserParameters: DotNetStartBrowserParameters) {
+    fun reset(
+        projectFilePath: String,
+        trackEnvs: Boolean,
+        envs: Map<String, String>,
+        trackUrl: Boolean,
+        dotNetStartBrowserParameters: DotNetStartBrowserParameters
+    ) {
         isLoaded = false
 
+        this.trackEnvs = trackEnvs
         this.trackUrl = trackUrl
 
         runnableProjectsModel?.projects?.adviseOnce(lifetime) { projectList ->
@@ -116,6 +137,10 @@ class AspireHostConfigurationViewModel(
                 }?.let { project ->
                     projectSelector.project.set(project)
 
+                    val effectiveEnvs =
+                        if (trackEnvs) project.environmentVariables.associate { it.key to it.value } else envs
+                    environmentVariablesEditor.envs.set(effectiveEnvs)
+
                     val runOptions = project.getRunOptions()
                     val effectiveUrl = if (trackUrl) runOptions.startBrowserUrl else dotNetStartBrowserParameters.url
                     urlEditor.defaultValue.value = effectiveUrl
diff --git a/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostExecutorFactory.kt b/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostExecutorFactory.kt
index 3ae9e022..c97152cc 100644
--- a/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostExecutorFactory.kt
+++ b/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostExecutorFactory.kt
@@ -13,6 +13,9 @@ import com.jetbrains.rider.model.runnableProjectsModel
 import com.jetbrains.rider.projectView.solution
 import com.jetbrains.rider.run.configurations.AsyncExecutorFactory
 import com.jetbrains.rider.run.configurations.project.DotNetProjectConfigurationParameters
+import com.jetbrains.rider.run.environment.ExecutableParameterProcessor
+import com.jetbrains.rider.run.environment.ExecutableRunParameters
+import com.jetbrains.rider.run.environment.ProjectProcessOptions
 import com.jetbrains.rider.runtime.DotNetExecutable
 import com.jetbrains.rider.runtime.RiderDotNetActiveRuntimeHost
 import com.jetbrains.rider.util.NetUtils
@@ -20,6 +23,8 @@ import me.rafaelldi.aspire.run.AspireHostProgramRunner.Companion.DEBUG_SESSION_P
 import me.rafaelldi.aspire.run.AspireHostProgramRunner.Companion.DEBUG_SESSION_TOKEN
 import me.rafaelldi.aspire.run.AspireHostProgramRunner.Companion.DOTNET_DASHBOARD_OTLP_ENDPOINT_URL
 import me.rafaelldi.aspire.settings.AspireSettings
+import org.jetbrains.concurrency.await
+import java.io.File
 import java.util.*
 
 class AspireHostExecutorFactory(
@@ -50,13 +55,11 @@ class AspireHostExecutorFactory(
         }
     }
 
-    private fun getDotNetExecutable(runnableProject: RunnableProject): DotNetExecutable {
+    private suspend fun getDotNetExecutable(runnableProject: RunnableProject): DotNetExecutable {
         val projectOutput = runnableProject.projectOutputs.firstOrNull()
             ?: throw CantRunException("Unable to find project output")
-        val envs = runnableProject.environmentVariables
-            .associate { it.key to it.value }
-            .toMutableMap()
 
+        val envs = parameters.envs.toMutableMap()
         val debugSessionToken = UUID.randomUUID().toString()
         val debugSessionPort = NetUtils.findFreePort(67800)
         val openTelemetryProtocolEndpointPort = NetUtils.findFreePort(87800)
@@ -65,14 +68,32 @@ class AspireHostExecutorFactory(
         if (AspireSettings.getInstance().collectTelemetry)
             envs[DOTNET_DASHBOARD_OTLP_ENDPOINT_URL] = "http://localhost:$openTelemetryProtocolEndpointPort"
 
-        return DotNetExecutable(
+        val processOptions = ProjectProcessOptions(
+            File(runnableProject.projectFilePath),
+            File(projectOutput.workingDirectory)
+        )
+        val runParameters = ExecutableRunParameters(
             projectOutput.exePath,
-            projectOutput.tfm,
             projectOutput.workingDirectory,
             ParametersListUtil.join(projectOutput.defaultArguments),
+            envs,
+            true,
+            projectOutput.tfm
+        )
+
+        val params = ExecutableParameterProcessor
+            .getInstance(project)
+            .processEnvironment(runParameters, processOptions)
+            .await()
+
+        return DotNetExecutable(
+            params.executablePath ?: projectOutput.exePath,
+            params.tfm ?: projectOutput.tfm,
+            params.workingDirectoryPath ?: projectOutput.workingDirectory,
+            params.commandLineArgumentString ?: ParametersListUtil.join(projectOutput.defaultArguments),
             false,
             false,
-            envs,
+            params.environmentVariables,
             true,
             parameters.startBrowserAction,
             null,
diff --git a/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostSettingsEditor.kt b/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostSettingsEditor.kt
index 930efc98..7f4b5017 100644
--- a/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostSettingsEditor.kt
+++ b/src/main/kotlin/me/rafaelldi/aspire/run/AspireHostSettingsEditor.kt
@@ -3,12 +3,10 @@ package me.rafaelldi.aspire.run
 import com.intellij.openapi.project.Project
 import com.jetbrains.rd.util.lifetime.Lifetime
 import com.jetbrains.rider.run.configurations.ProtocolLifetimedSettingsEditor
-import com.jetbrains.rider.run.configurations.controls.ControlViewBuilder
-import com.jetbrains.rider.run.configurations.controls.ProjectSelector
-import com.jetbrains.rider.run.configurations.controls.TextEditor
-import com.jetbrains.rider.run.configurations.controls.ViewSeparator
+import com.jetbrains.rider.run.configurations.controls.*
 import com.jetbrains.rider.run.configurations.controls.startBrowser.BrowserSettingsEditor
 import com.jetbrains.rider.run.configurations.runnableProjectsModelIfAvailable
+import me.rafaelldi.aspire.AspireBundle
 import javax.swing.JComponent
 
 class AspireHostSettingsEditor(private val project: Project) :
@@ -19,9 +17,10 @@ class AspireHostSettingsEditor(private val project: Project) :
         viewModel = AspireHostConfigurationViewModel(
             lifetime,
             project.runnableProjectsModelIfAvailable,
-            ProjectSelector("Project:", "Project"),
-            ViewSeparator("Open browser"),
-            TextEditor("URL", "URL", lifetime),
+            ProjectSelector(AspireBundle.message("run.editor.project"), "Project"),
+            EnvironmentVariablesEditor(AspireBundle.message("run.editor.environment.variables"), "Environment_variables"),
+            ViewSeparator(AspireBundle.message("run.editor.open.browser")),
+            TextEditor(AspireBundle.message("run.editor.url"), "URL", lifetime),
             BrowserSettingsEditor("")
         )
         return ControlViewBuilder(lifetime, project, "AspireHost").build(viewModel)
@@ -32,6 +31,8 @@ class AspireHostSettingsEditor(private val project: Project) :
         if (selectedProject != null) {
             configuration.parameters.apply {
                 projectFilePath = selectedProject.projectFilePath
+                trackEnvs = viewModel.trackEnvs
+                envs = viewModel.environmentVariablesEditor.envs.value
                 trackUrl = viewModel.trackUrl
                 startBrowserParameters.url = viewModel.urlEditor.text.value
                 startBrowserParameters.browser = viewModel.dotNetBrowserSettingsEditor.settings.value.myBrowser
@@ -47,6 +48,8 @@ class AspireHostSettingsEditor(private val project: Project) :
         configuration.parameters.apply {
             viewModel.reset(
                 projectFilePath,
+                trackEnvs,
+                envs,
                 trackUrl,
                 startBrowserParameters
             )
diff --git a/src/main/resources/messages/AspireBundle.properties b/src/main/resources/messages/AspireBundle.properties
index 7cdb1614..b8cd0b96 100644
--- a/src/main/resources/messages/AspireBundle.properties
+++ b/src/main/resources/messages/AspireBundle.properties
@@ -7,6 +7,11 @@ action.Aspire.Settings.description=Open plugin settings page
 action.Aspire.Help.text=Aspire Help
 action.Aspire.Help.description=Open plugin help
 
+run.editor.project=Project:
+run.editor.environment.variables=Environment variables:
+run.editor.open.browser=Open browser
+run.editor.url=URL
+
 configurable.Aspire=Aspire
 configurable.Aspire.check.new.version=Check for new versions of the Aspire workload during startup
 configurable.Aspire.show.service=Show projects in the Services tool window