diff --git a/Cargo.toml b/Cargo.toml
index c6e6d4c..8f03437 100644
--- a/Cargo.toml
+++ b/Cargo.toml
@@ -17,7 +17,7 @@ tokio = { version = "1.50.0", features = ["full"] }
 serde = { version = "1.0.228", features = ["derive"] }
 serde_json = { version = "1.0", features = ["preserve_order"] }
 serde_bytes = "0.11"
-clap = { version = "4.6", features = ["derive"] }
+clap = { version = "4.6", features = ["derive", "env"] }
 anyhow = "1.0"
 walkdir = "2.5"
 indicatif = "0.18.4"
diff --git a/src/bin/query.rs b/src/bin/query.rs
index ae8a374..d76aa61 100644
--- a/src/bin/query.rs
+++ b/src/bin/query.rs
@@ -49,7 +49,7 @@ struct Args {
     database: Option<String>,
 
     /// Path to the git repository for git-aware queries
-    #[arg(long, default_value = ".")]
+    #[arg(long, env = "SEMCODE_GIT_REPO", default_value = ".")]
     git_repo: String,
 
     /// Path to local model directory (for semantic search)
@@ -82,6 +82,50 @@ struct Args {
     git_only: bool,
 }
 
+#[cfg(test)]
+mod tests {
+    use super::*;
+    use clap::Parser;
+    use std::env;
+
+    #[test]
+    fn test_git_repo_env_var() {
+        let key = "SEMCODE_GIT_REPO";
+        let value = "/tmp/test_repo";
+        env::set_var(key, value);
+
+        // No arguments provided, should use env var
+        let args = Args::try_parse_from(&["query"]).unwrap();
+        assert_eq!(args.git_repo, value);
+
+        env::remove_var(key);
+    }
+
+    #[test]
+    fn test_git_repo_priority() {
+        let key = "SEMCODE_GIT_REPO";
+        let env_value = "/tmp/env_repo";
+        let arg_value = "/tmp/arg_repo";
+        env::set_var(key, env_value);
+
+        // Argument should take priority over env var
+        let args = Args::try_parse_from(&["query", "--git-repo", arg_value]).unwrap();
+        assert_eq!(args.git_repo, arg_value);
+
+        env::remove_var(key);
+    }
+
+    #[test]
+    fn test_git_repo_default() {
+        let key = "SEMCODE_GIT_REPO";
+        env::remove_var(key);
+
+        // No arguments and no env var, should use default
+        let args = Args::try_parse_from(&["query"]).unwrap();
+        assert_eq!(args.git_repo, ".");
+    }
+}
+
 /// Check if the current commit needs indexing and perform incremental indexing if needed
 async fn index_current_commit_if_needed(
     db_manager: Arc<DatabaseManager>,
diff --git a/src/bin/semcode-mcp.rs b/src/bin/semcode-mcp.rs
index 3ca0666..b5e142b 100644
--- a/src/bin/semcode-mcp.rs
+++ b/src/bin/semcode-mcp.rs
@@ -1814,7 +1814,7 @@ struct Args {
     database: Option<String>,
 
     /// Path to the git repository for git-aware queries
-    #[arg(long, default_value = ".")]
+    #[arg(long, env = "SEMCODE_GIT_REPO", default_value = ".")]
     git_repo: String,
 
     /// Path to custom model directory (defaults to ~/.cache/semcode/models/)
@@ -5680,6 +5680,45 @@ async fn main() -> Result<()> {
 #[cfg(test)]
 mod tests {
     use super::*;
+    use clap::Parser;
+    use std::env;
+
+    #[test]
+    fn test_git_repo_env_var() {
+        let key = "SEMCODE_GIT_REPO";
+        let value = "/tmp/test_repo_mcp";
+        env::set_var(key, value);
+
+        // No arguments provided, should use env var
+        let args = Args::try_parse_from(&["semcode-mcp"]).unwrap();
+        assert_eq!(args.git_repo, value);
+
+        env::remove_var(key);
+    }
+
+    #[test]
+    fn test_git_repo_priority() {
+        let key = "SEMCODE_GIT_REPO";
+        let env_value = "/tmp/env_repo_mcp";
+        let arg_value = "/tmp/arg_repo_mcp";
+        env::set_var(key, env_value);
+
+        // Argument should take priority over env var
+        let args = Args::try_parse_from(&["semcode-mcp", "--git-repo", arg_value]).unwrap();
+        assert_eq!(args.git_repo, arg_value);
+
+        env::remove_var(key);
+    }
+
+    #[test]
+    fn test_git_repo_default() {
+        let key = "SEMCODE_GIT_REPO";
+        env::remove_var(key);
+
+        // No arguments and no env var, should use default
+        let args = Args::try_parse_from(&["semcode-mcp"]).unwrap();
+        assert_eq!(args.git_repo, ".");
+    }
 
     #[test]
     fn test_indexing_state_new() {