diff --git a/README.md b/README.md
index 0c801f37de..0d70ba785b 100644
--- a/README.md
+++ b/README.md
@@ -634,6 +634,10 @@ terragrunt = {
       arguments = [
         "-lock-timeout=20m"
       ]
+
+      env_vars = {
+        TF_VAR_var_from_environment = "value"            
+      }
     }
   }
 }
@@ -641,7 +645,8 @@ terragrunt = {
 
 Each `extra_arguments` block includes an arbitrary name (in the example above, `retry_lock`), a list of `commands` to
 which the extra arguments should be add, a list of `arguments` or `required_var_files` or `optional_var_files` to add.
-With the configuration above, when you run `terragrunt apply`, Terragrunt will call Terraform as follows:
+You can also pass custom variables using `env_vars` block, which stores environment variables in key value pairs. With
+the configuration above, when you run `terragrunt apply`, Terragrunt will call Terraform as follows:
 
 When available, it is preferable to use interpolation functions such as
 [get_terraform_commands_that_need_locking](#get_terraform_commands_that_need_locking) and
diff --git a/cli/args.go b/cli/args.go
index 79db13e925..d806e84b71 100644
--- a/cli/args.go
+++ b/cli/args.go
@@ -142,6 +142,23 @@ func filterTerraformExtraArgs(terragruntOptions *options.TerragruntOptions, terr
 	return out
 }
 
+func filterTerraformEnvVarsFromExtraArgs(terragruntOptions *options.TerragruntOptions, terragruntConfig *config.TerragruntConfig) map[string]string {
+	out := map[string]string{}
+	cmd := util.FirstArg(terragruntOptions.TerraformCliArgs)
+
+	for _, arg := range terragruntConfig.Terraform.ExtraArgs {
+		for _, argcmd := range arg.Commands {
+			if cmd == argcmd {
+				for k, v := range arg.EnvVars {
+					out[k] = v
+				}
+			}
+		}
+	}
+
+	return out
+}
+
 func parseEnvironmentVariables(environment []string) map[string]string {
 	environmentMap := make(map[string]string)
 
diff --git a/cli/cli_app.go b/cli/cli_app.go
index 68a68457ed..7514e2dd9c 100644
--- a/cli/cli_app.go
+++ b/cli/cli_app.go
@@ -321,6 +321,9 @@ func runTerragruntWithConfig(terragruntOptions *options.TerragruntOptions, terra
 	// Add extra_arguments to the command
 	if terragruntConfig.Terraform != nil && terragruntConfig.Terraform.ExtraArgs != nil && len(terragruntConfig.Terraform.ExtraArgs) > 0 {
 		terragruntOptions.InsertTerraformCliArgs(filterTerraformExtraArgs(terragruntOptions, terragruntConfig)...)
+		for k, v := range filterTerraformEnvVarsFromExtraArgs(terragruntOptions, terragruntConfig) {
+			terragruntOptions.Env[k] = v
+		}
 	}
 
 	if util.FirstArg(terragruntOptions.TerraformCliArgs) == CMD_INIT {
diff --git a/config/config.go b/config/config.go
index 2d4b5a8792..90615e86b5 100644
--- a/config/config.go
+++ b/config/config.go
@@ -119,15 +119,21 @@ func (conf *TerraformConfig) ValidateHooks() error {
 
 // TerraformExtraArguments sets a list of arguments to pass to Terraform if command fits any in the `Commands` list
 type TerraformExtraArguments struct {
-	Name             string   `hcl:",key"`
-	Arguments        []string `hcl:"arguments,omitempty"`
-	RequiredVarFiles []string `hcl:"required_var_files,omitempty"`
-	OptionalVarFiles []string `hcl:"optional_var_files,omitempty"`
-	Commands         []string `hcl:"commands,omitempty"`
+	Name             string            `hcl:",key"`
+	Arguments        []string          `hcl:"arguments,omitempty"`
+	RequiredVarFiles []string          `hcl:"required_var_files,omitempty"`
+	OptionalVarFiles []string          `hcl:"optional_var_files,omitempty"`
+	Commands         []string          `hcl:"commands,omitempty"`
+	EnvVars          map[string]string `hcl:"env_vars,omitempty"`
 }
 
 func (conf *TerraformExtraArguments) String() string {
-	return fmt.Sprintf("TerraformArguments{Name = %s, Arguments = %v, Commands = %v}", conf.Name, conf.Arguments, conf.Commands)
+	return fmt.Sprintf(
+		"TerraformArguments{Name = %s, Arguments = %v, Commands = %v, EnvVars = %v}",
+		conf.Name,
+		conf.Arguments,
+		conf.Commands,
+		conf.EnvVars)
 }
 
 // Return the default path to use for the Terragrunt configuration file. The reason this is a method rather than a
diff --git a/config/config_test.go b/config/config_test.go
index 6f3d0f85fa..b0412eb0e4 100644
--- a/config/config_test.go
+++ b/config/config_test.go
@@ -623,7 +623,10 @@ terragrunt = {
         "-var-file=terraform.tfvars",
         "-var-file=terraform-secret.tfvars"
       ]
-      commands = ["${get_terraform_commands_that_need_vars()}"]
+			commands = ["${get_terraform_commands_that_need_vars()}"]
+			env_vars = {
+				TEST_VAR = "value"
+			}
     }
   }
 }
@@ -648,6 +651,10 @@ terragrunt = {
 		assert.Equal(t,
 			TERRAFORM_COMMANDS_NEED_VARS,
 			terragruntConfig.Terraform.ExtraArgs[0].Commands)
+
+		assert.Equal(t,
+			map[string]string{"TEST_VAR": "value"},
+			terragruntConfig.Terraform.ExtraArgs[0].EnvVars)
 	}
 }
 
diff --git a/test/fixture-env-vars-block/main.tf b/test/fixture-env-vars-block/main.tf
new file mode 100644
index 0000000000..27d087cad6
--- /dev/null
+++ b/test/fixture-env-vars-block/main.tf
@@ -0,0 +1,7 @@
+variable "custom_var" {
+  description = "Provided as TF_VAR_custom_var in terraform.tfvars"
+}
+
+output "test" {
+  value = "${var.custom_var}"
+}
diff --git a/test/fixture-env-vars-block/terraform.tfvars b/test/fixture-env-vars-block/terraform.tfvars
new file mode 100644
index 0000000000..94036d9bb9
--- /dev/null
+++ b/test/fixture-env-vars-block/terraform.tfvars
@@ -0,0 +1,19 @@
+terragrunt = {
+  terraform = {
+    extra_arguments "test" {
+      commands = ["apply"]
+      env_vars = {
+        TF_VAR_custom_var = "I'm set in extra_arguments env_vars"
+      }
+    }
+
+    extra_arguments "shouldnotapply" {
+      commands = [ "refresh" ]
+
+      env_vars = {
+        TF_VAR_custom_var = "I'm only set for refresh command, so will be ignored for apply"
+      }
+
+    }
+  }
+}
diff --git a/test/integration_test.go b/test/integration_test.go
index e14863a94b..310f65bd37 100644
--- a/test/integration_test.go
+++ b/test/integration_test.go
@@ -38,6 +38,7 @@ const (
 	TEST_FIXTURE_OUTPUT_ALL                               = "fixture-output-all"
 	TEST_FIXTURE_STDOUT                                   = "fixture-download/stdout-test"
 	TEST_FIXTURE_EXTRA_ARGS_PATH                          = "fixture-extra-args/"
+	TEST_FIXTURE_ENV_VARS_BLOCK_PATH                      = "fixture-env-vars-block/"
 	TEST_FIXTURE_LOCAL_DOWNLOAD_PATH                      = "fixture-download/local"
 	TEST_FIXTURE_REMOTE_DOWNLOAD_PATH                     = "fixture-download/remote"
 	TEST_FIXTURE_OVERRIDE_DOWNLOAD_PATH                   = "fixture-download/override"
@@ -807,6 +808,13 @@ func TestExtraArgumentsWithEnv(t *testing.T) {
 	assert.Contains(t, out.String(), "Hello, World!")
 }
 
+func TestExtraArgumentsWithEnvVarBlock(t *testing.T) {
+	out := new(bytes.Buffer)
+	runTerragruntRedirectOutput(t, fmt.Sprintf("terragrunt apply --terragrunt-non-interactive --terragrunt-working-dir %s", TEST_FIXTURE_ENV_VARS_BLOCK_PATH), out, os.Stderr)
+	t.Log(out.String())
+	assert.Contains(t, out.String(), "I'm set in extra_arguments env_vars")
+}
+
 func TestExtraArgumentsWithRegion(t *testing.T) {
 	// Do not use t.Parallel() on this test, it will infers with the other TestExtraArguments.* tests
 	out := new(bytes.Buffer)