diff --git a/CHANGELOG.md b/CHANGELOG.md
index 86c522de..f5e2e24a 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -17,6 +17,7 @@ and this project adheres to [Semantic Versioning](http://semver.org/spec/v2.0.0.
 - Correct FFI definitions `Py_SetProgramName` and `Py_SetPythonHome` to take `*const` argument instead of `*mut`. [#1021](https://github.com/PyO3/pyo3/pull/1021)
 - Rename `PyString::to_string` to `to_str`, change return type `Cow<str>` to `&str`. [#1023](https://github.com/PyO3/pyo3/pull/1023)
 - Correct FFI definition `_PyLong_AsByteArray` `*mut c_uchar` argument instead of `*const c_uchar`. [#1029](https://github.com/PyO3/pyo3/pull/1029)
+- Rename `PYTHON_SYS_EXECUTABLE` to `PYO3_PYTHON`. The old name will continue to work but will be undocumented, and will be removed in a future release. [#1039](https://github.com/PyO3/pyo3/pull/1039)
 - `PyType::as_type_ptr` is no longer `unsafe`. [#1047](https://github.com/PyO3/pyo3/pull/1047)
 - Change `PyIterator::from_object` to return `PyResult<PyIterator>` instead of `Result<PyIterator, PyDowncastError>`. [#1051](https://github.com/PyO3/pyo3/pull/1051)
 - Implement `Send + Sync` for `PyErr`. `PyErr::new`, `PyErr::from_type`, `PyException::py_err` and `PyException::into` have had these bounds added to their arguments. [#1067](https://github.com/PyO3/pyo3/pull/1067)
diff --git a/build.rs b/build.rs
index a091e3e3..b72b810f 100644
--- a/build.rs
+++ b/build.rs
@@ -386,7 +386,7 @@ fn get_rustc_link_lib(config: &InterpreterConfig) -> Result<String> {
 ///
 /// The following locations are checked in the order listed:
 ///
-/// 1. If `PYTHON_SYS_EXECUTABLE` is set, this intepreter is used and an error is raised if the
+/// 1. If `PYO3_PYTHON` is set, this intepreter is used and an error is raised if the
 /// version doesn't match.
 /// 2. `python`
 /// 3. `python{major version}`
@@ -394,7 +394,10 @@ fn get_rustc_link_lib(config: &InterpreterConfig) -> Result<String> {
 ///
 /// If none of the above works, an error is returned
 fn find_interpreter_and_get_config() -> Result<(InterpreterConfig, HashMap<String, String>)> {
-    let python_interpreter = if let Some(exe) = env::var_os("PYTHON_SYS_EXECUTABLE") {
+    let python_interpreter = if let Some(exe) = env::var_os("PYO3_PYTHON") {
+        exe.into()
+    } else if let Some(exe) = env::var_os("PYTHON_SYS_EXECUTABLE") {
+        // Backwards-compatible name for PYO3_PYTHON; this may be removed at some point in the future.
         exe.into()
     } else {
         PathBuf::from(
@@ -506,7 +509,7 @@ fn configure(interpreter_config: &InterpreterConfig) -> Result<String> {
     };
 
     if interpreter_config.version.major == 2 {
-        // fail PYTHON_SYS_EXECUTABLE=python2 cargo ...
+        // fail PYO3_PYTHON=python2 cargo ...
         bail!("Python 2 is not supported");
     }
 
@@ -637,7 +640,13 @@ fn main() -> Result<()> {
         // TODO: Find out how we can set -undefined dynamic_lookup here (if this is possible)
     }
 
-    let env_vars = ["LD_LIBRARY_PATH", "PATH", "PYTHON_SYS_EXECUTABLE", "LIB"];
+    let env_vars = [
+        "LD_LIBRARY_PATH",
+        "PATH",
+        "PYTHON_SYS_EXECUTABLE",
+        "PYO3_PYTHON",
+        "LIB",
+    ];
 
     for var in env_vars.iter() {
         println!("cargo:rerun-if-env-changed={}", var);
diff --git a/guide/src/building_and_distribution.md b/guide/src/building_and_distribution.md
index 354261d7..7c36fd38 100644
--- a/guide/src/building_and_distribution.md
+++ b/guide/src/building_and_distribution.md
@@ -2,7 +2,7 @@
 
 ## Python version
 
-PyO3 uses a build script to determine the Python version and set the correct linker arguments. By default it uses the `python3` executable. You can override the Python interpreter by setting `PYTHON_SYS_EXECUTABLE`, e.g., `PYTHON_SYS_EXECUTABLE=python3.6`.
+PyO3 uses a build script to determine the Python version and set the correct linker arguments. By default it uses the `python3` executable. You can override the Python interpreter by setting `PYO3_PYTHON`, e.g., `PYO3_PYTHON=python3.6`.
 
 ## Linking
 
diff --git a/guide/src/pypy.md b/guide/src/pypy.md
index 838ceba8..111cf430 100644
--- a/guide/src/pypy.md
+++ b/guide/src/pypy.md
@@ -6,9 +6,9 @@ Support is only provided for building Rust extension for code running under PyPy
 
 This is a limitation of cpyext and support for embedding cpyext is not planned.
 
-Compilation against PyPy is done by exporting the `PYTHON_SYS_EXECUTABLE` to point to a PyPy binary or by compiling in a PyPy virtualenv.
+Compilation against PyPy is done by exporting `PYO3_PYTHON` to point to a PyPy binary or by compiling in a PyPy virtualenv.
 
-For example, `PYTHON_SYS_EXECUTABLE="/path/to/pypy3" /path/to/pypy3 setup.py install`
+For example, `PYO3_PYTHON="/path/to/pypy3" /path/to/pypy3 setup.py install`
 
 
 ## Unsupported features