diff --git a/src/main/java/io/supertokens/config/Config.java b/src/main/java/io/supertokens/config/Config.java
index 33fa93aef..ea6260954 100644
--- a/src/main/java/io/supertokens/config/Config.java
+++ b/src/main/java/io/supertokens/config/Config.java
@@ -23,7 +23,6 @@
 import io.supertokens.exceptions.QuitProgramException;
 import io.supertokens.output.Logging;
 
-import java.io.File;
 import java.io.IOException;
 
 public class Config extends ResourceDistributor.SingletonResource {
@@ -32,6 +31,8 @@ public class Config extends ResourceDistributor.SingletonResource {
     private final Main main;
     private final CoreConfig core;
 
+    private static final ObjectMapper mapper = new ObjectMapper(new YAMLFactory());
+
     private Config(Main main, String configFilePath) {
         this.main = main;
         try {
@@ -61,8 +62,8 @@ public static CoreConfig getConfig(Main main) {
 
     private CoreConfig loadCoreConfig(String configFilePath) throws IOException {
         Logging.info(main, "Loading supertokens config.");
-        final ObjectMapper mapper = new ObjectMapper(new YAMLFactory());
-        CoreConfig config = mapper.readValue(new File(configFilePath), CoreConfig.class);
+        String configFileContent = ConfigPreprocessor.loadFromFile(configFilePath).getProcessedConfig();
+        CoreConfig config = mapper.readValue(configFileContent, CoreConfig.class);
         config.validateAndInitialise(main);
         return config;
     }
diff --git a/src/main/java/io/supertokens/config/ConfigPreprocessor.java b/src/main/java/io/supertokens/config/ConfigPreprocessor.java
new file mode 100644
index 000000000..e913518fc
--- /dev/null
+++ b/src/main/java/io/supertokens/config/ConfigPreprocessor.java
@@ -0,0 +1,70 @@
+/*
+ *    Copyright (c) 2022, VRAI Labs and/or its affiliates. All rights reserved.
+ *
+ *    This software is licensed under the Apache License, Version 2.0 (the
+ *    "License") as published by the Apache Software Foundation.
+ *
+ *    You may not use this file except in compliance with the License. You may
+ *    obtain a copy of the License at http://www.apache.org/licenses/LICENSE-2.0
+ *
+ *    Unless required by applicable law or agreed to in writing, software
+ *    distributed under the License is distributed on an "AS IS" BASIS, WITHOUT
+ *    WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied. See the
+ *    License for the specific language governing permissions and limitations
+ *    under the License.
+ */
+
+package io.supertokens.config;
+
+import io.supertokens.exceptions.QuitProgramException;
+
+import java.io.File;
+import java.io.IOException;
+import java.nio.file.Files;
+import java.util.regex.Pattern;
+
+public class ConfigPreprocessor {
+    private static final Pattern commentPattern = Pattern.compile("(?:^|[^\\\\])#(.*)"); // (?:^|[^\\])#(.*)
+    private static final Pattern envPattern = Pattern.compile("(?:^|[^\\\\])\\$\\{([^}]*)}"); // (?:^|[^\\])\$\{([^}]*)}
+    private static final Pattern escEnvPattern = Pattern.compile("\\\\\\$\\{([^}]*)}"); // \\\$\{([^}]*)}
+
+    private final String config;
+    private String processedConfig;
+
+    public ConfigPreprocessor(String config) {
+        this.config = config;
+        this.processedConfig = null;
+    }
+
+    private String removeComments(String str) {
+        return commentPattern.matcher(str).replaceAll(match -> match.group().substring(0, match.start(1)));
+    }
+
+    private String substituteEnvironmentVariables(String str) {
+        return envPattern.matcher(str).replaceAll(match -> {
+            String envVarName = match.group(1).trim();
+            String envVar = System.getenv(envVarName);
+            if (envVar == null)
+                throw new QuitProgramException("Environment variable \"" + envVarName + "\" does not exist."
+                        + "\nUse \"\\${" + envVarName + "}\" if you are not inserting an environment variable here.");
+            return envVar;
+        });
+    }
+
+    private String unescapeEscapedEnvironmentVariables(String str) {
+        return escEnvPattern.matcher(str).replaceAll(match -> match.group().substring(1));
+    }
+
+    public String getProcessedConfig() {
+        if (processedConfig == null) {
+            processedConfig = removeComments(config);
+            processedConfig = substituteEnvironmentVariables(processedConfig);
+            processedConfig = unescapeEscapedEnvironmentVariables(processedConfig);
+        }
+        return processedConfig;
+    }
+
+    public static ConfigPreprocessor loadFromFile(String configFilePath) throws IOException {
+        return new ConfigPreprocessor(Files.readString(new File(configFilePath).toPath()));
+    }
+}