diff --git a/src/ClientOptionsTrait.php b/src/ClientOptionsTrait.php
index d4a323b26..43deaef7c 100644
--- a/src/ClientOptionsTrait.php
+++ b/src/ClientOptionsTrait.php
@@ -97,8 +97,7 @@ private function buildClientOptions(array $options)
             'libVersion' => null,
             'apiEndpoint' => null,
             'clientCertSource' => null,
-            // if the universe domain hasn't been explicitly set, assume GDU ("googleapis.com")
-            'universeDomain' => GetUniverseDomainInterface::DEFAULT_UNIVERSE_DOMAIN,
+            'universeDomain' => null,
         ];
 
         $supportedTransports = $this->supportedTransports();
@@ -178,6 +177,11 @@ private function buildClientOptions(array $options)
             $apiEndpoint = self::determineMtlsEndpoint($options['apiEndpoint']);
         }
 
+        // If the user has not supplied a universe domain, use the environment variable if set.
+        // Otherwise, use the default ("googleapis.com").
+        $options['universeDomain'] ??= getenv('GOOGLE_CLOUD_UNIVERSE_DOMAIN')
+            ?: GetUniverseDomainInterface::DEFAULT_UNIVERSE_DOMAIN;
+
         // mTLS: It is not valid to configure mTLS outside of "googleapis.com" (yet)
         if (isset($options['clientCertSource'])
             && $options['universeDomain'] !== GetUniverseDomainInterface::DEFAULT_UNIVERSE_DOMAIN
diff --git a/tests/Tests/Unit/ClientOptionsTraitTest.php b/tests/Tests/Unit/ClientOptionsTraitTest.php
index 03deacc65..d07a46d9a 100644
--- a/tests/Tests/Unit/ClientOptionsTraitTest.php
+++ b/tests/Tests/Unit/ClientOptionsTraitTest.php
@@ -475,13 +475,17 @@ public function testMtlsClientOptionWithDefaultClientCertSource()
 
     /**
      * @dataProvider provideServiceAddressTemplate
+     * @runInSeparateProcess
      */
-    public function testServiceAddressTemplate(array $options, string $expectedEndpoint)
+    public function testServiceAddressTemplate(array $options, string $expectedEndpoint, string $envVar = null)
     {
+        if ($envVar) {
+            putenv($envVar);
+        }
         $client = new UniverseDomainStubClientOptionsClient();
         $updatedOptions = $client->buildClientOptions($options);
 
-        $this->assertEquals($updatedOptions['apiEndpoint'], $expectedEndpoint);
+        $this->assertEquals($expectedEndpoint, $updatedOptions['apiEndpoint']);
     }
 
     public function provideServiceAddressTemplate()
@@ -503,6 +507,21 @@ public function provideServiceAddressTemplate()
                 ['universeDomain' => 'foo.com', 'apiEndpoint' => 'new.test.address.com'],
                 'new.test.address.com', // set through api endpoint (universe domain is not used)
             ],
+            [
+                [],
+                'stub.googleapis.com',
+                'GOOGLE_CLOUD_UNIVERSE_DOMAIN=', // env var is ignored when empty
+            ],
+            [
+                ['universeDomain' => 'foo.com'],
+                'stub.foo.com',
+                'GOOGLE_CLOUD_UNIVERSE_DOMAIN=bar.com', // env var is ignored when client option is set
+            ],
+            [
+                [],
+                'stub.bar.com',
+                'GOOGLE_CLOUD_UNIVERSE_DOMAIN=bar.com', // env var is used when client option isn't set
+            ],
         ];
     }