diff --git a/README.md b/README.md
index 78ca0403..bc6812fb 100644
--- a/README.md
+++ b/README.md
@@ -31,20 +31,18 @@ path = "/etc/drone/drone.db"
 [docker]
 cert = ""
 key = ""
-nodes = [
-  "unix:///var/run/docker.sock",
-  "unix:///var/run/docker.sock"
-]
+addr = "unix:///var/run/docker.sock"
+swarm = ""
 
 [service]
-name = "github"
+kind = "github"
 base = "https://github.com"
 orgs = []
 open = false
-private_mode = false
+private = false
 skip_verify = true
 
-[service.oauth]
+[auth]
 client = ""
 secret = ""
 authorize = "https://github.com/login/oauth/authorize"
@@ -54,3 +52,17 @@ request_token = ""
 [agents]
 secret = ""
 ```
+
+Configuration settings can also be set by environment variables using the scheme `DRONE_<section>_<confkey>`, substituting the section title for `<section>` and the key for `<confkey>`, in all caps. For example:
+
+```shell
+#!/bin/bash
+# prepare environment for executing drone
+DRONE_DOCKER_ADDR="tcp://10.0.0.1:2375"     # for [docker] section, 'addr' setting
+DRONE_AUTH_CLIENT="0123456789abcdef0123AA"  # for [auth] section, 'client' setting
+DRONE_AUTH_SECRET="<sha-1 hash secret>"     # for [auth] section, 'secret' setting
+
+exec bin/drone -config=drone.toml
+```
+
+_NOTE: Configuration settings from environment variables override values set in the TOML file._
diff --git a/pkg/server/token_test.go b/pkg/server/token_test.go
index 628e0b4d..9fb7c537 100644
--- a/pkg/server/token_test.go
+++ b/pkg/server/token_test.go
@@ -12,9 +12,9 @@ import (
 	. "github.com/drone/drone/Godeps/_workspace/src/github.com/franela/goblin"
 	"github.com/drone/drone/Godeps/_workspace/src/github.com/gin-gonic/gin"
 	"github.com/drone/drone/Godeps/_workspace/src/github.com/stretchr/testify/mock"
+	"github.com/drone/drone/pkg/config"
 	"github.com/drone/drone/pkg/server/recorder"
 	"github.com/drone/drone/pkg/server/session"
-	"github.com/drone/drone/pkg/settings"
 	"github.com/drone/drone/pkg/store/mock"
 	"github.com/drone/drone/pkg/types"
 )
@@ -60,9 +60,10 @@ func TestToken(t *testing.T) {
 				ctx.Set("datastore", store)
 				ctx.Set("user", &types.User{Login: "Freya"})
 
-				config := settings.Settings{Session: &settings.Session{Secret: "Otto"}}
-				ctx.Set("settings", &config)
-				ctx.Set("session", session.New(config.Session))
+				conf := &config.Config{}
+				conf.Session.Secret = "Otto"
+				ctx.Set("settings", conf)
+				ctx.Set("session", session.New(conf))
 
 				// prepare the mock
 				store.On("AddToken", mock.AnythingOfType("*types.Token")).Return(test.storeErr).Once()
@@ -98,9 +99,10 @@ func TestToken(t *testing.T) {
 				ctx.Set("datastore", store)
 				ctx.Set("user", &types.User{Login: "Freya"})
 
-				config := settings.Settings{Session: &settings.Session{Secret: "Otto"}}
-				ctx.Set("settings", &config)
-				ctx.Set("session", session.New(config.Session))
+				conf := &config.Config{}
+				conf.Session.Secret = "Otto"
+				ctx.Set("settings", conf)
+				ctx.Set("session", session.New(conf))
 
 				// prepare the mock
 				store.On("TokenLabel", mock.AnythingOfType("*types.User"), test.inLabel).Return(test.outToken, test.errTokenLabel).Once()