diff --git a/HISTORY.rst b/HISTORY.rst
index 3b63d7a5..8d0e1d88 100644
--- a/HISTORY.rst
+++ b/HISTORY.rst
@@ -4,8 +4,9 @@ Release History
 2.0.1 (2015-??-??)
 ------------------
 
-* Handle new environment variable
+* Handle new environment variables
   `PLATFORMIO_BUILD_FLAGS <http://docs.platformio.org/en/latest/envvars.html#platformio-build-flags>`_
+  and `PLATFORMIO_LDF_CYCLIC <http://docs.platformio.org/en/latest/envvars.html#platformio-ldf-cyclic>`_
 * Pass to API requests information about Continuous Integration system. This
   information will be used by PlatformIO-API.
 * Use ``include`` directories from toolchain when initialising project for IDE
diff --git a/docs/envvars.rst b/docs/envvars.rst
index 1b6aa2e4..25414e27 100644
--- a/docs/envvars.rst
+++ b/docs/envvars.rst
@@ -77,6 +77,13 @@ PLATFORMIO_SRCBUILD_FLAGS
 
 Allows to set :ref:`projectconf` option :ref:`projectconf_srcbuild_flags`.
 
+.. _envvar_PLATFORMIO_LDF_CYCLIC:
+
+PLATFORMIO_LDF_CYCLIC
+~~~~~~~~~~~~~~~~~~~~~
+
+Allows to set :ref:`projectconf` option :ref:`projectconf_ldf_cyclic`.
+
 Settings
 --------
 
diff --git a/docs/projectconf.rst b/docs/projectconf.rst
index 23f93c8b..8aba9efe 100644
--- a/docs/projectconf.rst
+++ b/docs/projectconf.rst
@@ -331,7 +331,7 @@ Example:
 ``use_libs``
 ^^^^^^^^^^^^
 
-Specify libraries which should be used by ``Library Dependency Finder`` with
+Specify libraries which should be used by ``Library Dependency Finder (LDF)`` with
 the highest priority.
 
 Example:
@@ -344,7 +344,7 @@ Example:
 ``ignore_libs``
 ^^^^^^^^^^^^^^^
 
-Specify libraries which should be ignored by ``Library Dependency Finder``
+Specify libraries which should be ignored by ``Library Dependency Finder (LDF)``
 
 Example:
 
@@ -353,6 +353,30 @@ Example:
     [env:ignore_some_libs]
     ignore_libs = SPI,EngduinoV3_ID123
 
+.. _projectconf_ldf_cyclic:
+
+``ldf_cyclic``
+^^^^^^^^^^^^^^
+
+Control cyclic (recursive) behaviour for ``Library Dependency Finder (LDF)``.
+By default, this option is turned OFF (``ldf_cyclic=False``) and means, that
+``LDF`` will find only libraries which are included in source files from the
+project :ref:`projectconf_pio_src_dir`.
+
+If you want to enable cyclic (recursive, nested) search, please set this option
+to ``True``. Founded library will be treated like a new source files and
+``LDF`` will search dependencies for it.
+
+This option can be set by global environment variable
+:ref:`envvar_PLATFORMIO_LDF_CYCLIC`.
+
+Example:
+
+.. code-block::   ini
+
+    [env:libs_with_enabled_ldf_cyclic]
+    ldf_cyclic = True
+
 
 .. _projectconf_examples:
 
diff --git a/platformio/builder/main.py b/platformio/builder/main.py
index 45ec63d6..4b07953e 100644
--- a/platformio/builder/main.py
+++ b/platformio/builder/main.py
@@ -38,6 +38,7 @@ commonvars.AddVariables(
     ("SRCBUILD_FLAGS",),
     ("IGNORE_LIBS",),
     ("USE_LIBS",),
+    ("LDF_CYCLIC",),
 
     # board options
     ("BOARD",),
diff --git a/platformio/builder/tools/platformio.py b/platformio/builder/tools/platformio.py
index 7abd8b75..7eae3b34 100644
--- a/platformio/builder/tools/platformio.py
+++ b/platformio/builder/tools/platformio.py
@@ -278,7 +278,10 @@ def BuildDependentLibraries(env, src_dir):  # pylint: disable=R0914
                         len(state['ordered']) + 1, finder.getLibName(),
                         _lib_dir))
                     state['libs'].add(_lib_dir)
-                    state = _process_src_dir(state, _lib_dir)
+
+                    if getenv("PLATFORMIO_LDF_CYCLIC",
+                              env.subst("$LDF_CYCLIC")).lower() == "true":
+                        state = _process_src_dir(state, _lib_dir)
         return state
 
     # end internal prototypes