diff --git a/README.md b/README.md
index 5fa3348..01a71f1 100644
--- a/README.md
+++ b/README.md
@@ -159,6 +159,22 @@ Responsible for loading the values parsed from `process.env` into the configurat
   // Can optionally also be an Array of values to limit process.env to.
   //
   nconf.env(['only', 'load', 'these', 'values', 'from', 'process.env']);  
+
+  //
+  // Can also specify a separator for nested keys (instead of the default ':')
+  //
+  nconf.env('__');
+  // Get the value of the env variable 'database__host'
+  var dbHost = nconf.get('database:host');
+
+  //
+  // Or use both options
+  //
+  nconf.env({
+    separator: '__',
+    whitelist: ['database__host', 'only', 'load', 'these', 'values']
+  });
+  var dbHost = nconf.get('database:host');
 ```
 
 ### Literal
diff --git a/lib/nconf/stores/env.js b/lib/nconf/stores/env.js
index 936d45a..e73026e 100644
--- a/lib/nconf/stores/env.js
+++ b/lib/nconf/stores/env.js
@@ -6,6 +6,7 @@
  */
 
 var util = require('util'),
+    common = require('../common'),
     Memory = require('./memory').Memory;
 
 //
@@ -17,9 +18,17 @@ var util = require('util'),
 var Env = exports.Env = function (options) {
   Memory.call(this, options);
 
-  this.type     = 'env';
-  this.readOnly = true;
-  this.options  = options || [];
+  options        = options || {};
+  this.type      = 'env';
+  this.readOnly  = true;
+  this.whitelist = options.whitelist || [];
+  this.separator = options.separator || '';
+  if (options instanceof Array) {
+    this.whitelist = options;
+  }
+  if (typeof(options) === 'string') {
+    this.separator = options;
+  }
 };
 
 // Inherit from the Memory store
@@ -43,9 +52,13 @@ Env.prototype.loadEnv = function () {
 
   this.readOnly = false;
   Object.keys(process.env).filter(function (key) {
-    return !self.options.length || self.options.indexOf(key) !== -1;
+    return !self.whitelist.length || self.whitelist.indexOf(key) !== -1;
   }).forEach(function (key) {
-    self.set(key, process.env[key]);
+    if (self.separator) {
+      self.set(common.key.apply(common, key.split(self.separator)), process.env[key]);
+    } else {
+      self.set(key, process.env[key]);
+    }
   });
 
   this.readOnly = true;
diff --git a/lib/nconf/stores/memory.js b/lib/nconf/stores/memory.js
index e075d7f..fbab7af 100644
--- a/lib/nconf/stores/memory.js
+++ b/lib/nconf/stores/memory.js
@@ -183,7 +183,7 @@ Memory.prototype.merge = function (key, value) {
   }
 
   return Object.keys(value).every(function (nested) {
-    return self.merge(fullKey + ':' + nested, value[nested]);
+    return self.merge(common.key(fullKey, nested), value[nested]);
   });
 };
 
@@ -207,4 +207,4 @@ Memory.prototype.reset = function () {
 //
 Memory.prototype.loadSync = function () {
   return this.store || {};
-};
\ No newline at end of file
+};
diff --git a/test/fixtures/scripts/nconf-nested-env.js b/test/fixtures/scripts/nconf-nested-env.js
new file mode 100644
index 0000000..cfc3365
--- /dev/null
+++ b/test/fixtures/scripts/nconf-nested-env.js
@@ -0,0 +1,11 @@
+/*
+ * nconf-nested-env.js: Test fixture for env with nested keys.
+ *
+ * (C) 2012, Nodejitsu Inc.
+ * (C) 2012, Michael Hart
+ *
+ */
+ 
+var nconf = require('../../../lib/nconf').env('_');
+
+process.stdout.write(nconf.get('SOME:THING'));
diff --git a/test/provider-test.js b/test/provider-test.js
index 158b40c..63cb6f1 100644
--- a/test/provider-test.js
+++ b/test/provider-test.js
@@ -60,6 +60,10 @@ vows.describe('nconf/provider').addBatch({
         script: path.join(fixturesDir, 'scripts', 'nconf-hierarchical-file-argv.js'),
         argv: ['--something', 'foobar'],
         env: { SOMETHING: true }
+      }),
+      "when 'env' is set to true with a nested separator": helpers.assertSystemConf({
+        script: path.join(fixturesDir, 'scripts', 'nconf-nested-env.js'),
+        env: { SOME_THING: 'foobar' }
       })
     }
   }
diff --git a/test/stores/env-test.js b/test/stores/env-test.js
index e96b05f..6ae4cb0 100644
--- a/test/stores/env-test.js
+++ b/test/stores/env-test.js
@@ -16,8 +16,9 @@ vows.describe('nconf/stores/env').addBatch({
     "should have the correct methods defined": function (env) {
       assert.isFunction(env.loadSync);
       assert.isFunction(env.loadEnv);
-      assert.isArray(env.options);
-      assert.lengthOf(env.options, 0);
+      assert.isArray(env.whitelist);
+      assert.lengthOf(env.whitelist, 0);
+      assert.equal(env.separator, '');
     }
   }
-}).export(module);
\ No newline at end of file
+}).export(module);