diff --git a/src/libstore-tests/meson.build b/src/libstore-tests/meson.build
index 123bccb90c4..835fe228db8 100644
--- a/src/libstore-tests/meson.build
+++ b/src/libstore-tests/meson.build
@@ -123,6 +123,7 @@ if get_option('benchmarks')
   benchmark_sources = files(
     'bench-main.cc',
     'derivation-parser-bench.cc',
+    'readline-bench.cc',
     'ref-scan-bench.cc',
   )
 
diff --git a/src/libstore-tests/readline-bench.cc b/src/libstore-tests/readline-bench.cc
new file mode 100644
index 00000000000..2a925e801d2
--- /dev/null
+++ b/src/libstore-tests/readline-bench.cc
@@ -0,0 +1,52 @@
+#include <benchmark/benchmark.h>
+
+#include "nix/util/file-descriptor.hh"
+#include "nix/util/file-system.hh"
+
+#ifndef _WIN32
+
+#  include <fcntl.h>
+#  include <unistd.h>
+
+using namespace nix;
+
+static void BM_ReadLineFile(benchmark::State & state)
+{
+    const int lineCount = state.range(0);
+    const std::string line = std::string(80, 'x') + "\n";
+    std::string payload;
+    payload.reserve(line.size() * lineCount);
+    for (int i = 0; i < lineCount; ++i)
+        payload += line;
+
+    auto [file, path] = createTempFile();
+    writeFull(file.get(), payload, /*allowInterrupts=*/false);
+    file.close();
+
+    for (auto _ : state) {
+        state.PauseTiming();
+
+        int flags = O_RDONLY;
+#  ifdef O_CLOEXEC
+        flags |= O_CLOEXEC;
+#  endif
+        AutoCloseFD in(open(path.c_str(), flags));
+        if (!in)
+            throw SysError("opening file");
+
+        state.ResumeTiming();
+
+        for (int i = 0; i < lineCount; ++i) {
+            auto s = readLine(in.get());
+            benchmark::DoNotOptimize(s);
+        }
+    }
+
+    deletePath(path);
+
+    state.SetItemsProcessed(state.iterations() * lineCount);
+}
+
+BENCHMARK(BM_ReadLineFile)->Arg(1'000)->Arg(10'000)->Arg(100'000);
+
+#endif
diff --git a/src/libutil-tests/file-descriptor.cc b/src/libutil-tests/file-descriptor.cc
new file mode 100644
index 00000000000..9853fad3dd1
--- /dev/null
+++ b/src/libutil-tests/file-descriptor.cc
@@ -0,0 +1,58 @@
+#include <gtest/gtest.h>
+
+#include "nix/util/file-descriptor.hh"
+
+#ifndef _WIN32
+
+#  include <unistd.h>
+
+namespace nix {
+
+TEST(ReadLine, ReadsLinesFromPipe)
+{
+    int fds[2];
+    ASSERT_EQ(pipe(fds), 0);
+
+    AutoCloseFD readSide{fds[0]};
+    AutoCloseFD writeSide{fds[1]};
+
+    writeFull(writeSide.get(), "hello\nworld\n", /*allowInterrupts=*/false);
+    writeSide.close();
+
+    EXPECT_EQ(readLine(readSide.get()), "hello");
+    EXPECT_EQ(readLine(readSide.get()), "world");
+    EXPECT_EQ(readLine(readSide.get(), /*eofOk=*/true), "");
+    EXPECT_EQ(readLine(readSide.get(), /*eofOk=*/true), "");
+}
+
+TEST(ReadLine, ReturnsPartialLineOnEofWhenAllowed)
+{
+    int fds[2];
+    ASSERT_EQ(pipe(fds), 0);
+
+    AutoCloseFD readSide{fds[0]};
+    AutoCloseFD writeSide{fds[1]};
+
+    writeFull(writeSide.get(), "partial", /*allowInterrupts=*/false);
+    writeSide.close();
+
+    EXPECT_EQ(readLine(readSide.get(), /*eofOk=*/true), "partial");
+    EXPECT_EQ(readLine(readSide.get(), /*eofOk=*/true), "");
+}
+
+TEST(ReadLine, ThrowsOnEofWhenNotAllowed)
+{
+    int fds[2];
+    ASSERT_EQ(pipe(fds), 0);
+
+    AutoCloseFD readSide{fds[0]};
+    AutoCloseFD writeSide{fds[1]};
+
+    writeSide.close();
+
+    EXPECT_THROW(readLine(readSide.get()), EndOfFile);
+}
+
+} // namespace nix
+
+#endif
diff --git a/src/libutil-tests/meson.build b/src/libutil-tests/meson.build
index 24cbf18e549..7c3890be90f 100644
--- a/src/libutil-tests/meson.build
+++ b/src/libutil-tests/meson.build
@@ -59,6 +59,7 @@ sources = files(
   'config.cc',
   'executable-path.cc',
   'file-content-address.cc',
+  'file-descriptor.cc',
   'file-system.cc',
   'git.cc',
   'hash.cc',
diff --git a/src/libutil/file-descriptor.cc b/src/libutil/file-descriptor.cc
index 6e07e6e8818..5439fdc6ff2 100644
--- a/src/libutil/file-descriptor.cc
+++ b/src/libutil/file-descriptor.cc
@@ -1,3 +1,4 @@
+#include "nix/util/file-descriptor.hh"
 #include "nix/util/serialise.hh"
 #include "nix/util/util.hh"
 
@@ -77,6 +78,7 @@ Descriptor AutoCloseFD::get() const
 void AutoCloseFD::close()
 {
     if (fd != INVALID_DESCRIPTOR) {
+        clearReadLineCache(fd);
         if (
 #ifdef _WIN32
             ::CloseHandle(fd)
diff --git a/src/libutil/include/nix/util/file-descriptor.hh b/src/libutil/include/nix/util/file-descriptor.hh
index aa6d4e8f092..d8e7918ace7 100644
--- a/src/libutil/include/nix/util/file-descriptor.hh
+++ b/src/libutil/include/nix/util/file-descriptor.hh
@@ -85,6 +85,13 @@ void writeFull(Descriptor fd, std::string_view s, bool allowInterrupts = true);
  */
 std::string readLine(Descriptor fd, bool eofOk = false);
 
+/**
+ * Discard any buffered state associated with `readLine`.
+ *
+ * This is intended for internal use by file descriptor wrappers like `AutoCloseFD`.
+ */
+void clearReadLineCache(Descriptor fd);
+
 /**
  * Write a line to a file descriptor.
  */
diff --git a/src/libutil/unix/file-descriptor.cc b/src/libutil/unix/file-descriptor.cc
index bdb8054eb5a..2a44a0dafe4 100644
--- a/src/libutil/unix/file-descriptor.cc
+++ b/src/libutil/unix/file-descriptor.cc
@@ -9,6 +9,8 @@
 #include <unistd.h>
 #include <poll.h>
 
+#include <unordered_map>
+
 #if defined(__linux__) && defined(__NR_openat2)
 #  define HAVE_OPENAT2 1
 #  include <sys/syscall.h>
@@ -24,6 +26,14 @@ namespace nix {
 
 namespace {
 
+struct ReadLineState
+{
+    std::string buffer;
+    size_t offset = 0;
+};
+
+thread_local std::unordered_map<int, ReadLineState> readLineStates;
+
 // This function is needed to handle non-blocking reads/writes. This is needed in the buildhook, because
 // somehow the json logger file descriptor ends up being non-blocking and breaks remote-building.
 // TODO: get rid of buildhook and remove this function again (https://github.com/NixOS/nix/issues/12688)
@@ -39,6 +49,11 @@ void pollFD(int fd, int events)
 }
 } // namespace
 
+void clearReadLineCache(int fd)
+{
+    readLineStates.erase(fd);
+}
+
 std::string readFile(int fd)
 {
     struct stat st;
@@ -93,32 +108,59 @@ void writeFull(int fd, std::string_view s, bool allowInterrupts)
 
 std::string readLine(int fd, bool eofOk)
 {
-    std::string s;
-    while (1) {
+    auto & state = readLineStates[fd];
+
+    while (true) {
+        if (state.offset < state.buffer.size()) {
+            auto newlinePos = state.buffer.find('\n', state.offset);
+            if (newlinePos != std::string::npos) {
+                std::string line(state.buffer, state.offset, newlinePos - state.offset);
+                state.offset = newlinePos + 1;
+
+                if (state.offset == state.buffer.size()) {
+                    // Clear the buffer (no more data)
+                    state.buffer.clear();
+                    state.offset = 0;
+                } else if (state.offset > 64 * 1024 && state.offset > state.buffer.size() / 2) {
+                    // Compact the buffer (has more data)
+                    state.buffer.erase(0, state.offset);
+                    state.offset = 0;
+                }
+
+                return line;
+            }
+        }
+
         checkInterrupt();
-        char ch;
-        // FIXME: inefficient
-        ssize_t rd = read(fd, &ch, 1);
+
+        char buf[8192];
+        ssize_t rd = read(fd, buf, sizeof(buf));
         if (rd == -1) {
             switch (errno) {
             case EINTR:
                 continue;
-            case EAGAIN: {
+            case EAGAIN:
                 pollFD(fd, POLLIN);
                 continue;
-            }
             default:
                 throw SysError("reading a line");
             }
         } else if (rd == 0) {
+            std::string line;
+            if (state.offset < state.buffer.size()) {
+                // Consume the rest of the buffer
+                line.assign(state.buffer, state.offset, state.buffer.size() - state.offset);
+                state.buffer.clear();
+                state.offset = 0;
+            }
+
+            clearReadLineCache(fd);
+
             if (eofOk)
-                return s;
-            else
-                throw EndOfFile("unexpected EOF reading a line");
+                return line;
+            throw EndOfFile("unexpected EOF reading a line");
         } else {
-            if (ch == '\n')
-                return s;
-            s += ch;
+            state.buffer.append(buf, rd);
         }
     }
 }
diff --git a/src/libutil/windows/file-descriptor.cc b/src/libutil/windows/file-descriptor.cc
index 57994eac00b..db7318888e1 100644
--- a/src/libutil/windows/file-descriptor.cc
+++ b/src/libutil/windows/file-descriptor.cc
@@ -83,6 +83,8 @@ std::string readLine(HANDLE handle, bool eofOk)
     }
 }
 
+void clearReadLineCache(HANDLE) {}
+
 void drainFD(HANDLE handle, Sink & sink /*, bool block*/)
 {
     std::vector<unsigned char> buf(64 * 1024);