diff --git a/lib/cli/config.js b/lib/cli/config.js
index ac719833cf..dcd0defd35 100644
--- a/lib/cli/config.js
+++ b/lib/cli/config.js
@@ -11,6 +11,7 @@ const fs = require('fs');
 const path = require('path');
 const debug = require('debug')('mocha:cli:config');
 const findUp = require('find-up');
+const yargs = require('yargs/yargs');
 const {createUnparsableFileError} = require('../errors');
 const utils = require('../utils');
 
@@ -76,6 +77,10 @@ exports.loadConfig = filepath => {
     } else {
       config = parsers.json(filepath);
     }
+
+    config = yargs(undefined, path.dirname(filepath))
+      .parserConfiguration(require('./options').YARGS_PARSER_CONFIG)
+      .config(config);
   } catch (err) {
     throw createUnparsableFileError(
       `Unable to read/parse ${filepath}: ${err}`,
diff --git a/test/integration/fixtures/config/mocharc-extended/.mocharc.json b/test/integration/fixtures/config/mocharc-extended/.mocharc.json
new file mode 100644
index 0000000000..98aae677ca
--- /dev/null
+++ b/test/integration/fixtures/config/mocharc-extended/.mocharc.json
@@ -0,0 +1,3 @@
+{
+  "extends": "./extends.json"
+}
diff --git a/test/integration/fixtures/config/mocharc-extended/base.json b/test/integration/fixtures/config/mocharc-extended/base.json
new file mode 100644
index 0000000000..89c92825f9
--- /dev/null
+++ b/test/integration/fixtures/config/mocharc-extended/base.json
@@ -0,0 +1,6 @@
+{
+  "require": ["foo", "bar"],
+  "bail": true,
+  "reporter": "dot",
+  "slow": 60
+}
diff --git a/test/integration/fixtures/config/mocharc-extended/extends.json b/test/integration/fixtures/config/mocharc-extended/extends.json
new file mode 100644
index 0000000000..715639efd7
--- /dev/null
+++ b/test/integration/fixtures/config/mocharc-extended/extends.json
@@ -0,0 +1,3 @@
+{
+  "extends": "./modifiers.json"
+}
diff --git a/test/integration/fixtures/config/mocharc-extended/modifiers.json b/test/integration/fixtures/config/mocharc-extended/modifiers.json
new file mode 100644
index 0000000000..8e6dcb1d3c
--- /dev/null
+++ b/test/integration/fixtures/config/mocharc-extended/modifiers.json
@@ -0,0 +1,5 @@
+{
+  "extends": "./base.json",
+  "reporter": "html",
+  "slow": 30
+}
diff --git a/test/integration/options.spec.js b/test/integration/options.spec.js
new file mode 100644
index 0000000000..77841ccdd9
--- /dev/null
+++ b/test/integration/options.spec.js
@@ -0,0 +1,42 @@
+'use strict';
+
+var path = require('path');
+var loadOptions = require('../../lib/cli/options').loadOptions;
+
+describe('options', function () {
+  var workingDirectory;
+  const workspaceDir = path.join(
+    __dirname,
+    'fixtures',
+    'config',
+    'mocharc-extended'
+  );
+
+  beforeEach(function () {
+    workingDirectory = process.cwd();
+    process.chdir(workspaceDir);
+  });
+
+  afterEach(function () {
+    process.chdir(workingDirectory);
+  });
+
+  it('Should support extended options using --config parameter', function () {
+    var extended = loadOptions([
+      '--config',
+      path.join(workspaceDir, 'extends.json')
+    ]);
+    expect(extended.require, 'to equal', ['foo', 'bar']);
+    expect(extended.bail, 'to equal', true);
+    expect(extended.reporter, 'to equal', 'html');
+    expect(extended.slow, 'to equal', 30);
+  });
+
+  it('Should support extended options using rc file', function () {
+    var extended = loadOptions([]);
+    expect(extended.require, 'to equal', ['foo', 'bar']);
+    expect(extended.bail, 'to equal', true);
+    expect(extended.reporter, 'to equal', 'html');
+    expect(extended.slow, 'to equal', 30);
+  });
+});