diff --git a/README.md b/README.md
index d0e6f7fc..e08c929e 100644
--- a/README.md
+++ b/README.md
@@ -1028,7 +1028,7 @@ You can find more examples in the `examples` directory of this repository.
 
 * **setNoDelay**([< _boolean_ >noDelay]) - _Client_ - Calls [`setNoDelay()`](https://nodejs.org/docs/latest/api/net.html#socketsetnodelaynodelay) on the underlying socket. Disabling Nagle's algorithm improves latency at the expense of lower throughput.
 
-* **sftp**(< _function_ >callback) - _(void)_ - Starts an SFTP session. `callback` has 2 parameters: < _Error_ >err, < _SFTP_ >sftp. For methods available on `sftp`, see the [`SFTP` client documentation](https://github.com/mscdex/ssh2/blob/master/SFTP.md).
+* **sftp**([< _object_ >env, ]< _function_ >callback) - _(void)_ - Starts an SFTP session. `env` is an environment to use when executing `sftp` methods. `callback` has 2 parameters: < _Error_ >err, < _SFTP_ >sftp. For methods available on `sftp`, see the [`SFTP` client documentation](https://github.com/mscdex/ssh2/blob/master/SFTP.md).
 
 * **shell**([[< _mixed_ >window,] < _object_ >options]< _function_ >callback) - _(void)_ - Starts an interactive shell session on the server, with an optional `window` object containing pseudo-tty settings (see 'Pseudo-TTY settings'). If `window === false`, then no pseudo-tty is allocated. `options` supports the `x11` and `env` options as described in `exec()`. `callback` has 2 parameters: < _Error_ >err, < _Channel_ >stream.
 
diff --git a/lib/client.js b/lib/client.js
index aa94ace0..7291c2ce 100644
--- a/lib/client.js
+++ b/lib/client.js
@@ -1552,17 +1552,22 @@ class Client extends EventEmitter {
     return this;
   }
 
-  sftp(cb) {
+  sftp(env, cb) {
     if (!this._sock || !isWritable(this._sock))
       throw new Error('Not connected');
 
+    if (typeof env === 'function') {
+      cb = env;
+      env = undefined;
+    }
+
     openChannel(this, 'sftp', (err, sftp) => {
       if (err) {
         cb(err);
         return;
       }
 
-      reqSubsystem(sftp, 'sftp', (err, sftp_) => {
+      const reqSubsystemCb = (err, sftp_) => {
         if (err) {
           cb(err);
           return;
@@ -1608,7 +1613,20 @@ class Client extends EventEmitter {
             .on('close', onExit);
 
         sftp._init();
-      });
+      };
+
+      if (typeof env === 'object' && env !== null) {
+        reqEnv(sftp, env, (err) => {
+          if (err) {
+            cb(err);
+            return;
+          }
+
+          reqSubsystem(sftp, 'sftp', reqSubsystemCb);
+        });
+      } else {
+        reqSubsystem(sftp, 'sftp', reqSubsystemCb);
+      }
     });
 
     return this;
@@ -1842,16 +1860,33 @@ function reqExec(chan, cmd, opts, cb) {
   chan._client._protocol.exec(chan.outgoing.id, cmd, true);
 }
 
-function reqEnv(chan, env) {
-  if (chan.outgoing.state !== 'open')
+function reqEnv(chan, env, cb) {
+  const wantReply = (typeof cb === 'function');
+
+  if (chan.outgoing.state !== 'open') {
+    if (wantReply)
+      cb(new Error('Channel is not open'));
     return;
+  }
+
+  if (wantReply) {
+    chan._callbacks.push((had_err) => {
+      if (had_err) {
+        cb(had_err !== true
+           ? had_err
+           : new Error('Unable to set environment'));
+        return;
+      }
+      cb();
+    });
+  }
 
   const keys = Object.keys(env || {});
 
   for (let i = 0; i < keys.length; ++i) {
     const key = keys[i];
     const val = env[key];
-    chan._client._protocol.env(chan.outgoing.id, key, val, false);
+    chan._client._protocol.env(chan.outgoing.id, key, val, wantReply);
   }
 }
 
diff --git a/test/test-sftp.js b/test/test-sftp.js
index 1bda7668..595e5091 100644
--- a/test/test-sftp.js
+++ b/test/test-sftp.js
@@ -755,6 +755,42 @@ setup('WriteStream', mustCall((client, server) => {
   }));
 }
 
+{
+  const { client, server } = setup_(
+    'SFTP client sets environment',
+    {
+      client: { username: 'foo', password: 'bar' },
+      server: { hostKeys: [ fixture('ssh_host_rsa_key') ] },
+    },
+  );
+
+  const env = { SSH2NODETEST: 'foo' };
+
+  server.on('connection', mustCall((conn) => {
+    conn.on('authentication', mustCall((ctx) => {
+      ctx.accept();
+    })).on('ready', mustCall(() => {
+      conn.on('session', mustCall((accept, reject) => {
+        accept().on('env', mustCall((accept, reject, info) => {
+          accept && accept();
+          assert(info.key === Object.keys(env)[0], 'Wrong env key');
+          assert(info.val === Object.values(env)[0], 'Wrong env value');
+        })).on('sftp', mustCall((accept, reject) => {
+          accept();
+        }));
+      }));
+    }));
+  }));
+
+  client.on('ready', mustCall(() => {
+    const timeout = setTimeout(mustNotCall(), 1000);
+    client.sftp(env, mustCall((err, sftp) => {
+      clearTimeout(timeout);
+      assert(!err, `Unexpected exec error: ${err}`);
+      client.end();
+    }));
+  }));
+}
 
 // =============================================================================
 function setup(title, cb) {