diff --git a/README.md b/README.md
index f11e50d..273691b 100644
--- a/README.md
+++ b/README.md
@@ -394,25 +394,26 @@ Tags can be in two forms:
 
 Both can coexist with standard Tag parsing.
 
-| Tag                    | Description                                 |
-| -----------------------| ------------------------------------------- |
-| `cmd`                  | If present, struct is a command.            |
-| `arg`                  | If present, field is an argument.           |
-| `env:"X"`              | Specify envar to use for default value.
-| `name:"X"`             | Long name, for overriding field name.       |
-| `help:"X"`             | Help text.                                  |
-| `type:"X"`             | Specify [named types](#custom-named-types) to use.                |
-| `placeholder:"X"`      | Placeholder text.                           |
-| `default:"X"`          | Default value.                              |
-| `short:"X"`            | Short name, if flag.                        |
-| `required`             | If present, flag/arg is required.           |
-| `optional`             | If present, flag/arg is optional.           |
-| `hidden`               | If present, command or flag is hidden.      |
-| `format:"X"`           | Format for parsing input, if supported.     |
-| `sep:"X"`              | Separator for sequences (defaults to ","). May be `none` to disable splitting. |
-| `enum:"X,Y,..."`       | Set of valid values allowed for this flag.  |
-| `group:"X"`            | Logical group for a flag or command.        |
-| `prefix:"X"`           | Prefix for all sub-flags.                   |
+Tag                    | Description
+-----------------------| -------------------------------------------
+`cmd`                  | If present, struct is a command.
+`arg`                  | If present, field is an argument.
+`env:"X"`              | Specify envar to use for default value.
+`name:"X"`             | Long name, for overriding field name.
+`help:"X"`             | Help text.
+`type:"X"`             | Specify [named types](#custom-named-types) to use.
+`placeholder:"X"`      | Placeholder text.
+`default:"X"`          | Default value.
+`short:"X"`            | Short name, if flag.
+`required`             | If present, flag/arg is required.
+`optional`             | If present, flag/arg is optional.
+`hidden`               | If present, command or flag is hidden.
+`format:"X"`           | Format for parsing input, if supported.
+`sep:"X"`              | Separator for sequences (defaults to ","). May be `none` to disable splitting.
+`enum:"X,Y,..."`       | Set of valid values allowed for this flag.
+`group:"X"`            | Logical group for a flag or command.
+`prefix:"X"`           | Prefix for all sub-flags.
+`set:"K=V"`            | Set a variable for expansion by child elements. Multiples can occur.
 
 <a id="markdown-variable-interpolation" name="variable-interpolation"></a>
 ## Variable interpolation
diff --git a/build.go b/build.go
index 4a487b9..ae1ccf7 100644
--- a/build.go
+++ b/build.go
@@ -28,6 +28,8 @@ func build(k *Kong, ast interface{}) (app *Application, err error) {
 	}
 	app.Node = node
 	app.Node.Flags = append(extraFlags, app.Node.Flags...)
+	app.Tag = newEmptyTag()
+	app.Tag.Vars = k.vars
 	return app, nil
 }
 
@@ -62,6 +64,8 @@ func flattenedFields(v reflect.Value) (out []flattenedField) {
 				}
 				// Accumulate prefixes.
 				subf.tag.Prefix = tag.Prefix + subf.tag.Prefix
+				// Combine parent vars.
+				subf.tag.Vars = tag.Vars.CloneWith(subf.tag.Vars)
 			}
 			out = append(out, sub...)
 			continue
@@ -78,6 +82,7 @@ func buildNode(k *Kong, v reflect.Value, typ NodeType, seenFlags map[string]bool
 	node := &Node{
 		Type:   typ,
 		Target: v,
+		Tag:    newEmptyTag(),
 	}
 	for _, field := range flattenedFields(v) {
 		ft := field.field
@@ -124,6 +129,7 @@ func buildNode(k *Kong, v reflect.Value, typ NodeType, seenFlags map[string]bool
 
 func buildChild(k *Kong, node *Node, typ NodeType, v reflect.Value, ft reflect.StructField, fv reflect.Value, tag *Tag, name string, seenFlags map[string]bool) {
 	child := buildNode(k, fv, typ, seenFlags)
+	child.Tag = tag
 	child.Parent = node
 	child.Help = tag.Help
 	child.Hidden = tag.Hidden
diff --git a/go.mod b/go.mod
new file mode 100644
index 0000000..da4aff7
--- /dev/null
+++ b/go.mod
@@ -0,0 +1,7 @@
+module github.com/alecthomas/kong
+
+require (
+	github.com/davecgh/go-spew v1.1.1 // indirect
+	github.com/pmezard/go-difflib v1.0.0 // indirect
+	github.com/stretchr/testify v1.2.2
+)
diff --git a/go.sum b/go.sum
new file mode 100644
index 0000000..e03ee77
--- /dev/null
+++ b/go.sum
@@ -0,0 +1,6 @@
+github.com/davecgh/go-spew v1.1.1 h1:vj9j/u1bqnvCEfJOwUhtlOARqs3+rkHYY13jYWTU97c=
+github.com/davecgh/go-spew v1.1.1/go.mod h1:J7Y8YcW2NihsgmVo/mv3lAwl/skON4iLHjSsI+c5H38=
+github.com/pmezard/go-difflib v1.0.0 h1:4DBwDE0NGyQoBHbLQYPwSUPoCMWR5BEzIk/f1lZbAQM=
+github.com/pmezard/go-difflib v1.0.0/go.mod h1:iKH77koFhYxTK1pcRnkKkqfTogsbg7gZNVY4sRDYZ/4=
+github.com/stretchr/testify v1.2.2 h1:bSDNvY7ZPG5RlJ8otE/7V6gMiyenm9RtJ7IUVIAoJ1w=
+github.com/stretchr/testify v1.2.2/go.mod h1:a8OnRcib4nhh0OaRAV+Yts87kKdq0PP7pXfy6kDkUVs=
diff --git a/kong.go b/kong.go
index fad3113..bce8f94 100644
--- a/kong.go
+++ b/kong.go
@@ -110,17 +110,18 @@ func New(grammar interface{}, options ...Option) (*Kong, error) {
 
 // Interpolate variables into model.
 func (k *Kong) interpolate(node *Node) (err error) {
-	node.Help, err = interpolate(node.Help, k.vars)
+	vars := node.Vars()
+	node.Help, err = interpolate(node.Help, vars)
 	if err != nil {
 		return fmt.Errorf("help for %s: %s", node.Path(), err)
 	}
 	for _, flag := range node.Flags {
-		if err = k.interpolateValue(flag.Value); err != nil {
+		if err = k.interpolateValue(flag.Value, vars); err != nil {
 			return err
 		}
 	}
 	for _, pos := range node.Positional {
-		if err = k.interpolateValue(pos); err != nil {
+		if err = k.interpolateValue(pos, vars); err != nil {
 			return err
 		}
 	}
@@ -132,14 +133,15 @@ func (k *Kong) interpolate(node *Node) (err error) {
 	return nil
 }
 
-func (k *Kong) interpolateValue(value *Value) (err error) {
-	if value.Default, err = interpolate(value.Default, k.vars); err != nil {
+func (k *Kong) interpolateValue(value *Value, vars Vars) (err error) {
+	vars = vars.CloneWith(value.Tag.Vars)
+	if value.Default, err = interpolate(value.Default, vars); err != nil {
 		return fmt.Errorf("default value for %s: %s", value.Summary(), err)
 	}
-	if value.Enum, err = interpolate(value.Enum, k.vars); err != nil {
+	if value.Enum, err = interpolate(value.Enum, vars); err != nil {
 		return fmt.Errorf("enum value for %s: %s", value.Summary(), err)
 	}
-	vars := mergeVars(k.vars, map[string]string{
+	vars = vars.CloneWith(map[string]string{
 		"default": value.Default,
 		"enum":    value.Enum,
 	})
@@ -149,17 +151,6 @@ func (k *Kong) interpolateValue(value *Value) (err error) {
 	return nil
 }
 
-func mergeVars(base, extra map[string]string) map[string]string {
-	out := make(map[string]string, len(base)+len(extra))
-	for k, v := range base {
-		out[k] = v
-	}
-	for k, v := range extra {
-		out[k] = v
-	}
-	return out
-}
-
 type helpValue bool
 
 func (h helpValue) BeforeApply(ctx *Context) error {
@@ -252,7 +243,7 @@ func (k *Kong) applyHook(ctx *Context, name string) error {
 		if !method.IsValid() {
 			continue
 		}
-		binds := k.bindings.clone().add(ctx, trace)
+		binds := k.bindings.clone().add(ctx, trace).add(trace.Node().Vars().CloneWith(k.vars))
 		if err := callMethod(name, value, method, binds); err != nil {
 			return err
 		}
diff --git a/model.go b/model.go
index db0fa58..8103bf5 100644
--- a/model.go
+++ b/model.go
@@ -43,6 +43,7 @@ type Node struct {
 	Positional []*Positional
 	Children   []*Node
 	Target     reflect.Value // Pointer to the value in the grammar that this Node is associated with.
+	Tag        *Tag
 
 	Argument *Value // Populated when Type is ArgumentNode.
 }
@@ -171,6 +172,14 @@ func (n *Node) FullPath() string {
 	return strings.TrimSpace(root.Name + " " + n.Path())
 }
 
+// Vars returns the combined Vars defined by all ancestors of this Node.
+func (n *Node) Vars() Vars {
+	if n == nil {
+		return Vars{}
+	}
+	return n.Parent.Vars().CloneWith(n.Tag.Vars)
+}
+
 // Path through ancestors to this Node.
 func (n *Node) Path() (out string) {
 	if n.Parent != nil {
diff --git a/options.go b/options.go
index 1bf3218..5bcec7e 100644
--- a/options.go
+++ b/options.go
@@ -29,6 +29,18 @@ func (v Vars) Apply(k *Kong) error {
 	return nil
 }
 
+// CloneWith clones the current Vars and merges "vars" onto the clone.
+func (v Vars) CloneWith(vars Vars) Vars {
+	out := Vars{}
+	for key, value := range v {
+		out[key] = value
+	}
+	for key, value := range vars {
+		out[key] = value
+	}
+	return out
+}
+
 // Exit overrides the function used to terminate. This is useful for testing or interactive use.
 func Exit(exit func(int)) OptionFunc {
 	return func(k *Kong) error {
diff --git a/tag.go b/tag.go
index 5ade2f1..7167a9e 100644
--- a/tag.go
+++ b/tag.go
@@ -27,10 +27,11 @@ type Tag struct {
 	Sep         rune
 	Enum        string
 	Group       string
+	Vars        Vars
 	Prefix      string // Optional prefix on anonymous structs. All sub-flags will have this prefix.
 
 	// Storage for all tag keys for arbitrary lookups.
-	items map[string]string
+	items map[string][]string
 }
 
 type tagChars struct {
@@ -40,15 +41,15 @@ type tagChars struct {
 var kongChars = tagChars{sep: ',', quote: '\'', assign: '='}
 var bareChars = tagChars{sep: ' ', quote: '"', assign: ':'}
 
-func parseTagItems(tagString string, chr tagChars) map[string]string {
-	d := map[string]string{}
+func parseTagItems(tagString string, chr tagChars) map[string][]string {
+	d := map[string][]string{}
 	key := []rune{}
 	value := []rune{}
 	quotes := false
 	inKey := true
 
 	add := func() {
-		d[string(key)] = string(value)
+		d[string(key)] = append(d[string(key)], string(value))
 		key = []rune{}
 		value = []rune{}
 		inKey = true
@@ -113,13 +114,18 @@ func getTagInfo(ft reflect.StructField) (string, tagChars) {
 	return string(ft.Tag), bareChars
 }
 
+func newEmptyTag() *Tag {
+	return &Tag{items: map[string][]string{}}
+}
+
 func parseTag(fv reflect.Value, ft reflect.StructField) *Tag {
 	if ft.Tag.Get("kong") == "-" {
-		return &Tag{Ignored: true, items: map[string]string{}}
+		t := newEmptyTag()
+		t.Ignored = true
+		return t
 	}
-	s, chars := getTagInfo(ft)
 	t := &Tag{
-		items: parseTagItems(s, chars),
+		items: parseTagItems(getTagInfo(ft)),
 	}
 	t.Cmd = t.Has("cmd")
 	t.Arg = t.Has("arg")
@@ -152,6 +158,14 @@ func parseTag(fv reflect.Value, ft reflect.StructField) *Tag {
 			t.Sep = ','
 		}
 	}
+	t.Vars = Vars{}
+	for _, set := range t.GetAll("set") {
+		parts := strings.SplitN(set, "=", 2)
+		if len(parts) == 0 {
+			fail("set should be in the form key=value but got %q", set)
+		}
+		t.Vars[parts[0]] = parts[1]
+	}
 	t.PlaceHolder = t.Get("placeholder")
 	if t.PlaceHolder == "" {
 		t.PlaceHolder = strings.ToUpper(dashedString(fv.Type().Name()))
@@ -170,29 +184,38 @@ func (t *Tag) Has(k string) bool {
 //
 // Note that this will return the empty string if the tag is missing.
 func (t *Tag) Get(k string) string {
+	values := t.items[k]
+	if len(values) == 0 {
+		return ""
+	}
+	return values[0]
+}
+
+// GetAll returns all encountered values for a tag, in the case of multiple occurrences.
+func (t *Tag) GetAll(k string) []string {
 	return t.items[k]
 }
 
 // GetBool returns true if the given tag looks like a boolean truth string.
 func (t *Tag) GetBool(k string) (bool, error) {
-	return strconv.ParseBool(t.items[k])
+	return strconv.ParseBool(t.Get(k))
 }
 
 // GetFloat parses the given tag as a float64.
 func (t *Tag) GetFloat(k string) (float64, error) {
-	return strconv.ParseFloat(t.items[k], 64)
+	return strconv.ParseFloat(t.Get(k), 64)
 }
 
 // GetInt parses the given tag as an int64.
 func (t *Tag) GetInt(k string) (int64, error) {
-	return strconv.ParseInt(t.items[k], 10, 64)
+	return strconv.ParseInt(t.Get(k), 10, 64)
 }
 
 // GetRune parses the given tag as a rune.
 func (t *Tag) GetRune(k string) (rune, error) {
-	r, _ := utf8.DecodeRuneInString(t.items[k])
+	r, _ := utf8.DecodeRuneInString(t.Get(k))
 	if r == utf8.RuneError {
-		return 0, fmt.Errorf("%v has a rune error", t.items[k])
+		return 0, fmt.Errorf("%v has a rune error", t.Get(k))
 	}
 	return r, nil
 }
diff --git a/tag_test.go b/tag_test.go
index efd3c92..5276788 100644
--- a/tag_test.go
+++ b/tag_test.go
@@ -1,6 +1,7 @@
 package kong_test
 
 import (
+	"strings"
 	"testing"
 
 	"github.com/stretchr/testify/require"
@@ -109,3 +110,31 @@ func TestManySeps(t *testing.T) {
 	require.NoError(t, err)
 	require.Equal(t, "hi", cli.Arg)
 }
+
+func TestTagSetOnEmbeddedStruct(t *testing.T) {
+	type Embedded struct {
+		Key string `help:"A key from ${where}."`
+	}
+	var cli struct {
+		Embedded `set:"where=somewhere"`
+	}
+	buf := &strings.Builder{}
+	p := mustNew(t, &cli, kong.Writers(buf, buf), kong.Exit(func(int) {}))
+	_, err := p.Parse([]string{"--help"})
+	require.NoError(t, err)
+	require.Contains(t, buf.String(), `A key from somewhere.`)
+}
+
+func TestTagSetOnCommand(t *testing.T) {
+	type Command struct {
+		Key string `help:"A key from ${where}."`
+	}
+	var cli struct {
+		Command Command `set:"where=somewhere" cmd:""`
+	}
+	buf := &strings.Builder{}
+	p := mustNew(t, &cli, kong.Writers(buf, buf), kong.Exit(func(int) {}))
+	_, err := p.Parse([]string{"command", "--help"})
+	require.NoError(t, err)
+	require.Contains(t, buf.String(), `A key from somewhere.`)
+}