diff --git a/sdk/include/opentelemetry/sdk/configuration/document_node.h b/sdk/include/opentelemetry/sdk/configuration/document_node.h
index dfc21df0ca..0ca1046542 100644
--- a/sdk/include/opentelemetry/sdk/configuration/document_node.h
+++ b/sdk/include/opentelemetry/sdk/configuration/document_node.h
@@ -58,6 +58,13 @@ class DocumentNode
   virtual PropertiesNodeConstIterator end_properties() const   = 0;
 
   virtual std::string Dump() const = 0;
+
+protected:
+  void DoSubstitution(std::string &value);
+
+  bool BooleanFromString(const std::string &value);
+  size_t IntegerFromString(const std::string &value);
+  double DoubleFromString(const std::string &value);
 };
 
 class DocumentNodeConstIteratorImpl
diff --git a/sdk/src/configuration/CMakeLists.txt b/sdk/src/configuration/CMakeLists.txt
index 03e70f9723..15efe1d364 100644
--- a/sdk/src/configuration/CMakeLists.txt
+++ b/sdk/src/configuration/CMakeLists.txt
@@ -5,7 +5,7 @@
 
 add_library(
   opentelemetry_configuration
-  configuration_factory.cc yaml_configuration_factory.cc ryml_document.cc
+  configuration_factory.cc document_node.cc yaml_configuration_factory.cc ryml_document.cc
   ryml_document_node.cc)
 
 set_target_properties(opentelemetry_configuration PROPERTIES EXPORT_NAME
diff --git a/sdk/src/configuration/document_node.cc b/sdk/src/configuration/document_node.cc
new file mode 100644
index 0000000000..a89242a504
--- /dev/null
+++ b/sdk/src/configuration/document_node.cc
@@ -0,0 +1,103 @@
+// Copyright The OpenTelemetry Authors
+// SPDX-License-Identifier: Apache-2.0
+
+#include "opentelemetry/sdk/common/global_log_handler.h"
+
+#include "opentelemetry/sdk/configuration/document_node.h"
+#include "opentelemetry/sdk/configuration/invalid_schema_exception.h"
+#include "opentelemetry/version.h"
+
+OPENTELEMETRY_BEGIN_NAMESPACE
+namespace sdk
+{
+namespace configuration
+{
+
+void DocumentNode::DoSubstitution(std::string &value)
+{
+  size_t len = value.length();
+  char c;
+
+  if (len < 4)
+  {
+    return;
+  }
+
+  c = value[0];
+  if (c != '$')
+  {
+    return;
+  }
+
+  c = value[1];
+  if (c != '{')
+  {
+    return;
+  }
+
+  c = value[len - 1];
+  if (c != '}')
+  {
+    return;
+  }
+
+  c = value[2];
+  if (!std::isalpha(c) && c != '_')
+  {
+    return;
+  }
+
+  for (int i = 3; i <= len - 2; i++)
+  {
+    c = value[i];
+    if (!std::isalnum(c) && c != '_')
+    {
+      return;
+    }
+  }
+
+  // value is of the form ${ENV_NAME}
+
+  std::string name = value.substr(2, len - 3);
+
+  const char *sub = std::getenv(name.c_str());
+  if (sub != nullptr)
+  {
+    value = sub;
+  }
+  else
+  {
+    value = "";
+  }
+}
+
+bool DocumentNode::BooleanFromString(const std::string &value)
+{
+  if (value == "true")
+  {
+    return true;
+  }
+
+  if (value == "false")
+  {
+    return false;
+  }
+
+  throw InvalidSchemaException("Illegal bool value");
+}
+
+size_t DocumentNode::IntegerFromString(const std::string &value)
+{
+  size_t val = atoll(value.c_str());
+  return val;
+}
+
+double DocumentNode::DoubleFromString(const std::string &value)
+{
+  double val = atof(value.c_str());
+  return val;
+}
+
+}  // namespace configuration
+}  // namespace sdk
+OPENTELEMETRY_END_NAMESPACE
diff --git a/sdk/src/configuration/ryml_document_node.cc b/sdk/src/configuration/ryml_document_node.cc
index 1cc2c2839f..0fc61dd36a 100644
--- a/sdk/src/configuration/ryml_document_node.cc
+++ b/sdk/src/configuration/ryml_document_node.cc
@@ -256,6 +256,8 @@ std::string RymlDocumentNode::GetRequiredString(const std::string &name)
   ryml::csubstr view            = ryml_child.val();
   std::string value(view.str, view.len);
 
+  DoSubstitution(value);
+
   return value;
 }
 
@@ -272,6 +274,9 @@ std::string RymlDocumentNode::GetString(const std::string &name, const std::stri
 
   ryml::csubstr view = ryml_child.val();
   std::string value(view.str, view.len);
+
+  DoSubstitution(value);
+
   return value;
 }
 
diff --git a/sdk/test/configuration/yaml_test.cc b/sdk/test/configuration/yaml_test.cc
index 210265d752..8c69f022a0 100644
--- a/sdk/test/configuration/yaml_test.cc
+++ b/sdk/test/configuration/yaml_test.cc
@@ -2,6 +2,7 @@
 // SPDX-License-Identifier: Apache-2.0
 
 #include <gtest/gtest.h>
+#include <stdlib.h>
 
 #include "opentelemetry/sdk/configuration/yaml_configuration_factory.h"
 
@@ -143,3 +144,42 @@ file_format: xx.yy
   auto config = DoParse(yaml);
   ASSERT_EQ(config, nullptr);
 }
+
+TEST(Yaml, no_substitution)
+{
+  unsetenv("ENV_NAME");
+
+  std::string yaml = R"(
+file_format: ${ENV_NAME}
+)";
+
+  auto config = DoParse(yaml);
+  ASSERT_NE(config, nullptr);
+  ASSERT_EQ(config->file_format, "");
+}
+
+TEST(Yaml, empty_substitution)
+{
+  setenv("ENV_NAME", "", 1);
+
+  std::string yaml = R"(
+file_format: ${ENV_NAME}
+)";
+
+  auto config = DoParse(yaml);
+  ASSERT_NE(config, nullptr);
+  ASSERT_EQ(config->file_format, "");
+}
+
+TEST(Yaml, with_substitution)
+{
+  setenv("ENV_NAME", "foo.bar", 1);
+
+  std::string yaml = R"(
+file_format: ${ENV_NAME}
+)";
+
+  auto config = DoParse(yaml);
+  ASSERT_NE(config, nullptr);
+  ASSERT_EQ(config->file_format, "foo.bar");
+}