diff --git a/examples/module/test/basic.test.ts b/examples/module/test/basic.test.ts
index 2e3df6728..c9d9413e9 100644
--- a/examples/module/test/basic.test.ts
+++ b/examples/module/test/basic.test.ts
@@ -1,15 +1,49 @@
 import { fileURLToPath } from 'node:url'
 import { describe, expect, it } from 'vitest'
-import { $fetch, setup } from '@nuxt/test-utils/e2e'
+import { $fetch, getBrowser, setRuntimeConfig, setup, url } from '@nuxt/test-utils/e2e'
 
 describe('ssr', async () => {
   await setup({
     rootDir: fileURLToPath(new URL('./fixtures/basic', import.meta.url)),
+    browser: true,
   })
 
   it('renders the index page', async () => {
     // Get response to a server-rendered page with `$fetch`.
     const html = await $fetch('/')
-    expect(html).toContain('<div>basic</div>')
+    expect(html).toContain('<span id="runtime">original value</span></div>')
+  })
+
+  it('changes runtime config client-side', async () => {
+    const browser = await getBrowser()
+    const page = await browser.newPage()
+    await page.goto(url('/'))
+
+    const el = page.locator('#runtime')
+    expect(await el.innerText()).to.equal('original value')
+
+    await page.evaluate(() => {
+      window.__NUXT_TEST_RUNTIME_CONFIG_SETTER__({ public: { myValue: 'overwritten by test!' } })
+    })
+
+    expect(await el.innerText()).to.equal('overwritten by test!')
+  })
+
+  it('changes runtime config in server route', async () => {
+    const originalConfig = await $fetch('/api/config')
+    expect(originalConfig.public.myValue).to.equal('original value')
+
+    await setRuntimeConfig({ public: { myValue: 'overwritten by test!' } })
+
+    const newConfig = await $fetch('/api/config')
+    expect(newConfig.public.myValue).to.equal('overwritten by test!')
+  })
+
+  it('changes runtime config', async () => {
+    expect(await $fetch('/')).toContain('<span id="runtime">original value</span></div>')
+
+    await setRuntimeConfig({ public: { myValue: 'overwritten by test!' } }, { restart: true })
+
+    expect(await $fetch('/')).toContain('<span id="runtime">overwritten by test!</span></div>')
   })
 })
diff --git a/examples/module/test/fixtures/basic/app.vue b/examples/module/test/fixtures/basic/app.vue
index 29a9c81fa..22f0dbf4a 100644
--- a/examples/module/test/fixtures/basic/app.vue
+++ b/examples/module/test/fixtures/basic/app.vue
@@ -1,6 +1,9 @@
 <template>
-  <div>basic</div>
+  <div>
+    basic <span id="runtime">{{ config.public.myValue }}</span>
+  </div>
 </template>
 
 <script setup>
+const config = useRuntimeConfig()
 </script>
diff --git a/examples/module/test/fixtures/basic/nuxt.config.ts b/examples/module/test/fixtures/basic/nuxt.config.ts
index 1bc2f7ccd..5b1ef6ef3 100644
--- a/examples/module/test/fixtures/basic/nuxt.config.ts
+++ b/examples/module/test/fixtures/basic/nuxt.config.ts
@@ -1,6 +1,11 @@
 import MyModule from '../../../src/module'
 
 export default defineNuxtConfig({
+  runtimeConfig: {
+    public: {
+      myValue: 'original value',
+    },
+  },
   modules: [
     MyModule
   ]
diff --git a/examples/module/test/fixtures/basic/plugins/ipc-listener.ts b/examples/module/test/fixtures/basic/plugins/ipc-listener.ts
new file mode 100644
index 000000000..b1bcd800b
--- /dev/null
+++ b/examples/module/test/fixtures/basic/plugins/ipc-listener.ts
@@ -0,0 +1,30 @@
+import defu from 'defu'
+import { defineNuxtPlugin } from 'nuxt/app'
+
+declare global {
+  interface Window {
+    __NUXT_TEST_RUNTIME_CONFIG_SETTER__: (env: { public: Record<string, unknown> }) => void
+  }
+}
+
+export default defineNuxtPlugin(() => {
+  const config = useRuntimeConfig()
+
+  if (process.client) {
+    window.__NUXT_TEST_RUNTIME_CONFIG_SETTER__ ??= (env: { public: Record<string, unknown> }) => {
+      config.public = defu(env.public, config.public)
+    }
+  }
+
+  if (process.server) {
+    process.on('message', (msg: { type: string; value: Record<string, string> }) => {
+      if (msg.type === 'update:runtime-config') {
+        for (const [key, value] of Object.entries(msg.value)) {
+          process.env[key] = value
+        }
+
+        process!.send!({ type: 'confirm:runtime-config' })
+      }
+    })
+  }
+})
diff --git a/examples/module/test/fixtures/basic/server/api/config.ts b/examples/module/test/fixtures/basic/server/api/config.ts
new file mode 100644
index 000000000..f07457e24
--- /dev/null
+++ b/examples/module/test/fixtures/basic/server/api/config.ts
@@ -0,0 +1,4 @@
+export default defineEventHandler(async (event) => {
+  const config = useRuntimeConfig(event)
+  return config
+})
diff --git a/package.json b/package.json
index 597f7ed35..e50d35672 100644
--- a/package.json
+++ b/package.json
@@ -53,6 +53,7 @@
     "pathe": "^1.1.1",
     "perfect-debounce": "^1.0.0",
     "radix3": "^1.1.0",
+    "scule": "^1.1.1",
     "std-env": "^3.6.0",
     "ufo": "^1.3.2",
     "unenv": "^1.8.0",
diff --git a/pnpm-lock.yaml b/pnpm-lock.yaml
index ccb0a59f0..547084fb0 100644
--- a/pnpm-lock.yaml
+++ b/pnpm-lock.yaml
@@ -64,6 +64,9 @@ importers:
       radix3:
         specifier: ^1.1.0
         version: 1.1.0
+      scule:
+        specifier: ^1.1.1
+        version: 1.1.1
       std-env:
         specifier: ^3.6.0
         version: 3.6.0
diff --git a/src/core/runtime-config.ts b/src/core/runtime-config.ts
new file mode 100644
index 000000000..b4edcbf17
--- /dev/null
+++ b/src/core/runtime-config.ts
@@ -0,0 +1,67 @@
+import { snakeCase } from 'scule'
+import { useTestContext } from './context'
+import { startServer } from './server'
+
+export function flattenObject(obj: Record<string, unknown> = {}) {
+  const flattened: Record<string, unknown> = {}
+
+  for (const key in obj) {
+    if (!(key in obj)) continue
+
+    const entry = obj[key]
+    if (typeof entry !== 'object' || entry == null) {
+      flattened[key] = obj[key]
+      continue
+    }
+    const flatObject = flattenObject(entry as Record<string, unknown>)
+
+    for (const x in flatObject) {
+      if (!(x in flatObject)) continue
+
+      flattened[key + '_' + x] = flatObject[x]
+    }
+  }
+
+  return flattened
+}
+
+export function convertObjectToConfig(obj: Record<string, unknown>, envPrefix: string) {
+  const makeEnvKey = (str: string) => `${envPrefix}${snakeCase(str).toUpperCase()}`
+
+  const env: Record<string, unknown> = {}
+  const flattened = flattenObject(obj)
+  for (const key in flattened) {
+    env[makeEnvKey(key)] = flattened[key]
+  }
+
+  return env
+}
+
+type SetRuntimeConfigOptions = { envPrefix?: string; restart?: boolean }
+export async function setRuntimeConfig(config: Record<string, unknown>, options: SetRuntimeConfigOptions = {}) {
+  const env = convertObjectToConfig(config, options.envPrefix ?? 'NUXT_')
+  const ctx = useTestContext()
+
+  if (options.restart) {
+    return await startServer({ env })
+  }
+
+  let updatedConfig = false
+  ctx.serverProcess?.once('message', (msg: { type: string }) => {
+    if (msg.type === 'confirm:runtime-config') {
+      updatedConfig = true
+    }
+  })
+
+  ctx.serverProcess?.send({ type: 'update:runtime-config', value: env })
+
+  // Wait for confirmation to ensure
+  for (let i = 0; i < 10; i++) {
+    if (updatedConfig) break
+    await new Promise((resolve) => setTimeout(resolve, 1000))
+  }
+
+  if (!updatedConfig) {
+    throw new Error('Missing confirmation of runtime config update!')
+  }
+}
diff --git a/src/core/server.ts b/src/core/server.ts
index 1305f7b5e..e0080d619 100644
--- a/src/core/server.ts
+++ b/src/core/server.ts
@@ -1,4 +1,4 @@
-import { execa } from 'execa'
+import { execa, execaNode } from 'execa'
 import { getRandomPort, waitForPort } from 'get-port-please'
 import type { FetchOptions } from 'ofetch'
 import { $fetch as _$fetch, fetch as _fetch } from 'ofetch'
@@ -10,7 +10,11 @@ import { useTestContext } from './context'
 // eslint-disable-next-line
 const kit: typeof _kit = _kit.default || _kit
 
-export async function startServer () {
+export interface StartServerOptions {
+  env?: Record<string, unknown>
+}
+
+export async function startServer (options: StartServerOptions = {}) {
   const ctx = useTestContext()
   await stopServer()
   const host = '127.0.0.1'
@@ -26,7 +30,8 @@ export async function startServer () {
         _PORT: String(port), // Used by internal _dev command
         PORT: String(port),
         HOST: host,
-        NODE_ENV: 'development'
+        NODE_ENV: 'development',
+        ...options.env
       }
     })
     await waitForPort(port, { retries: 32, host }).catch(() => {})
@@ -45,16 +50,15 @@ export async function startServer () {
     ctx.serverProcess.kill()
     throw lastError || new Error('Timeout waiting for dev server!')
   } else {
-    ctx.serverProcess = execa('node', [
-      resolve(ctx.nuxt!.options.nitro.output!.dir!, 'server/index.mjs')
-    ], {
+    ctx.serverProcess = execaNode(resolve(ctx.nuxt!.options.nitro.output!.dir!, 'server/index.mjs'), {
       stdio: 'inherit',
       env: {
         ...process.env,
         PORT: String(port),
         HOST: host,
-        NODE_ENV: 'test'
-      }
+        NODE_ENV: 'test',
+        ...options.env,
+      },
     })
     await waitForPort(port, { retries: 20, host })
   }
diff --git a/src/e2e.ts b/src/e2e.ts
index f8604f58d..7ed2bb1d2 100644
--- a/src/e2e.ts
+++ b/src/e2e.ts
@@ -5,4 +5,5 @@ export * from './core/nuxt'
 export * from './core/server'
 export * from './core/setup/index'
 export * from './core/run'
+export { setRuntimeConfig } from './core/runtime-config'
 export * from './core/types'