diff --git a/documentation/manpages/sdk/dotnet-environment-variables.7 b/documentation/manpages/sdk/dotnet-environment-variables.7
index 501263aeb1f9..4636a502f0bc 100644
--- a/documentation/manpages/sdk/dotnet-environment-variables.7
+++ b/documentation/manpages/sdk/dotnet-environment-variables.7
@@ -552,6 +552,9 @@ Configures the default programming language for the \f[V]dotnet new\f[R] command
 The default value is \f[V]C#\f[R].
 Valid values are \f[V]C#\f[R], \f[V]F#\f[R], or \f[V]VB\f[R].
 For more information, see dotnet new.
+.SS \f[V]DOTNET_TOOLS_RESOLVER_CACHE_FOLDER\f[R]
+.PP
+Overrides the default location ($HOME/.dotnet/toolResolverCache) for the shim files for locally installed tools.
 .SH \f[V]dotnet watch\f[R] ENVIRONMENT VARIABLES
 .PP
 For information about \f[V]dotnet watch\f[R] settings that are available as environment variables, see dotnet watch environment variables.
diff --git a/documentation/manpages/sdk/dotnet-tool-install.1 b/documentation/manpages/sdk/dotnet-tool-install.1
index f2ae419c9f3c..2d43bc248813 100644
--- a/documentation/manpages/sdk/dotnet-tool-install.1
+++ b/documentation/manpages/sdk/dotnet-tool-install.1
@@ -111,7 +111,7 @@ They\[cq]re stored in the same way as global tools: an executable binary with th
 .SS Local tools
 .PP
 Local tools are stored in the NuGet global directory, whatever you\[cq]ve set that to be.
-There are shim files in \f[V]$HOME/.dotnet/toolResolverCache\f[R] for each local tool that point to where the tools are within that location.
+There are shim files in \f[V]$HOME/.dotnet/toolResolverCache\f[R] for each local tool that point to where the tools are within that location (this path can be overridden with the \f[V]DOTNET_TOOLS_RESOLVER_CACHE_FOLDER\f[R] environment variable).
 .PP
 References to local tools are added to a \f[I]dotnet-tools.json\f[R] file in a \f[I].config\f[R] directory under the current directory.
 Starting in .NET 10, if a manifest file doesn\[cq]t exist yet, one is created automatically.
diff --git a/src/Cli/Microsoft.DotNet.Configurer/CliFolderPathCalculator.cs b/src/Cli/Microsoft.DotNet.Configurer/CliFolderPathCalculator.cs
index 47a36788f5c0..762b9de4db70 100644
--- a/src/Cli/Microsoft.DotNet.Configurer/CliFolderPathCalculator.cs
+++ b/src/Cli/Microsoft.DotNet.Configurer/CliFolderPathCalculator.cs
@@ -40,7 +40,9 @@ public static string WindowsNonExpandedToolsShimPath
         public static string DotnetUserProfileFolderPath =>
             Path.Combine(DotnetHomePath, DotnetProfileDirectoryName);
 
-        public static string ToolsResolverCachePath => Path.Combine(DotnetUserProfileFolderPath, ToolsResolverCacheFolderName);
+        public static string ToolsResolverCachePath =>
+            Environment.GetEnvironmentVariable("DOTNET_TOOLS_RESOLVER_CACHE_FOLDER") ??
+             Path.Combine(DotnetUserProfileFolderPath, ToolsResolverCacheFolderName);
 
         public static string DotnetHomePath
         {
diff --git a/test/dotnet.Tests/CommandTests/Tool/Restore/ToolRestoreCommandTests.cs b/test/dotnet.Tests/CommandTests/Tool/Restore/ToolRestoreCommandTests.cs
index c84b9c8ee372..799c755ed7e3 100644
--- a/test/dotnet.Tests/CommandTests/Tool/Restore/ToolRestoreCommandTests.cs
+++ b/test/dotnet.Tests/CommandTests/Tool/Restore/ToolRestoreCommandTests.cs
@@ -434,6 +434,55 @@ public void ItRestoresCorrectToolVersion()
             rows[0].Version.Should().Be("8.0.0-rc.1.23419.6");
         }
 
+        [Fact]
+        public void ItRestoresCorrectToolVersionWithOverriddenResolverCachePath()
+        {
+            var testDir = _testAssetsManager.CreateTestDirectory().Path;
+
+            string configContents = """
+                {
+                  "version": 1,
+                  "isRoot": true,
+                  "tools": {
+                    "dotnet-ef": {
+                      "version": "8.0.0-rc.1.23419.6",
+                      "commands": [
+                        "dotnet-ef"
+                      ]
+                    }
+                  }
+                }
+                """;
+
+            File.WriteAllText(Path.Combine(testDir, "dotnet-tools.json"), configContents);
+
+            string CliHome = Path.Combine(testDir, ".home");
+            Directory.CreateDirectory(CliHome);
+
+            var toolsResolverCacheFolder = Path.Combine(testDir, "toolsResolverCache");
+            var toolRestoreCommand = new DotnetCommand(Log, "tool", "restore")
+                .WithEnvironmentVariable("DOTNET_CLI_HOME", CliHome)
+                .WithEnvironmentVariable("DOTNET_SKIP_WORKLOAD_INTEGRITY_CHECK", "true")
+                .WithEnvironmentVariable("DOTNET_TOOLS_RESOLVER_CACHE_FOLDER", toolsResolverCacheFolder)
+                .WithWorkingDirectory(testDir);
+
+            toolRestoreCommand
+                .Execute()
+                .Should()
+                .Pass();
+
+            var cacheFilePath = Path.Combine(toolsResolverCacheFolder, "1", "dotnet-ef");
+
+            string json = File.ReadAllText(cacheFilePath);
+
+            var rows = JsonSerializer.Deserialize<List<CacheRow>>(json);
+
+            rows.Count.Should().Be(1);
+
+            rows[0].Name.Should().Be("dotnet-ef");
+            rows[0].Version.Should().Be("8.0.0-rc.1.23419.6");
+        }
+
         [Fact]
         public void WhenCannotFindManifestFileItPrintsWarning()
         {