diff --git a/CHANGELOG.md b/CHANGELOG.md
index 7bcfb1d06..adf77539c 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -11,6 +11,10 @@
   - postcss-next is replaced with postcss-preset-env
   - babel@7
 
+## Fixed
+
+  - Bring back test env [#1563](https://github.com/rails/webpacker/pull/1563)
+
 
 ## [4.0.0-pre.2] - 2018-04-2
 
diff --git a/lib/install/config/webpack/test.js b/lib/install/config/webpack/test.js
new file mode 100644
index 000000000..c5edff94a
--- /dev/null
+++ b/lib/install/config/webpack/test.js
@@ -0,0 +1,5 @@
+process.env.NODE_ENV = process.env.NODE_ENV || 'development'
+
+const environment = require('./environment')
+
+module.exports = environment.toWebpackConfig()
diff --git a/package/__tests__/production.js b/package/__tests__/production.js
index 96f212817..c42821263 100644
--- a/package/__tests__/production.js
+++ b/package/__tests__/production.js
@@ -13,9 +13,11 @@ describe('Production environment', () => {
 
     test('should use production config and environment', () => {
       process.env.RAILS_ENV = 'production'
-      const { environment } = require('../index')
+      process.env.NODE_ENV = 'production'
 
+      const { environment } = require('../index')
       const config = environment.toWebpackConfig()
+
       expect(config.output.path).toEqual(resolve('public', 'packs'))
       expect(config.output.publicPath).toEqual('/packs/')
       expect(config).toMatchObject({
diff --git a/package/__tests__/staging.js b/package/__tests__/staging.js
index 794e61553..131ef9ec0 100644
--- a/package/__tests__/staging.js
+++ b/package/__tests__/staging.js
@@ -11,11 +11,13 @@ describe('Custom environment', () => {
   describe('toWebpackConfig', () => {
     beforeEach(() => jest.resetModules())
 
-    test('should use staging config and production environment', () => {
+    test('should use staging config and default production environment', () => {
       process.env.RAILS_ENV = 'staging'
-      const { environment } = require('../index')
+      delete process.env.NODE_ENV
 
+      const { environment } = require('../index')
       const config = environment.toWebpackConfig()
+
       expect(config.output.path).toEqual(resolve('public', 'packs-staging'))
       expect(config.output.publicPath).toEqual('/packs-staging/')
       expect(config).toMatchObject({
diff --git a/package/__tests__/test.js b/package/__tests__/test.js
new file mode 100644
index 000000000..58b69c3b0
--- /dev/null
+++ b/package/__tests__/test.js
@@ -0,0 +1,26 @@
+/* test expect, describe, afterAll, beforeEach */
+
+const { resolve } = require('path')
+const { chdirTestApp, chdirCwd } = require('../utils/helpers')
+
+chdirTestApp()
+
+describe('Test environment', () => {
+  afterAll(chdirCwd)
+
+  describe('toWebpackConfig', () => {
+    beforeEach(() => jest.resetModules())
+
+    test('should use test config and production environment', () => {
+      process.env.RAILS_ENV = 'test'
+      process.env.NODE_ENV = 'test'
+
+      const { environment } = require('../index')
+      const config = environment.toWebpackConfig()
+
+      expect(config.output.path).toEqual(resolve('public', 'packs-test'))
+      expect(config.output.publicPath).toEqual('/packs-test/')
+      expect(config.devServer).toEqual(undefined)
+    })
+  })
+})
diff --git a/package/env.js b/package/env.js
index 494922d62..c1c3d454c 100644
--- a/package/env.js
+++ b/package/env.js
@@ -2,7 +2,7 @@ const { resolve } = require('path')
 const { safeLoad } = require('js-yaml')
 const { readFileSync } = require('fs')
 
-const NODE_ENVIRONMENTS = ['development', 'production']
+const NODE_ENVIRONMENTS = ['development', 'production', 'test']
 const DEFAULT = 'production'
 const configPath = resolve('config', 'webpacker.yml')
 
@@ -11,7 +11,7 @@ const nodeEnv = process.env.NODE_ENV
 
 const config = safeLoad(readFileSync(configPath), 'utf8')
 const availableEnvironments = Object.keys(config).join('|')
-const regex = new RegExp("^(" + availableEnvironments + ")$", 'g')
+const regex = new RegExp(`^(${availableEnvironments})$`, 'g')
 
 module.exports = {
   railsEnv: railsEnv && railsEnv.match(regex) ? railsEnv : DEFAULT,
diff --git a/package/environments/test.js b/package/environments/test.js
new file mode 100644
index 000000000..cb3d14ba9
--- /dev/null
+++ b/package/environments/test.js
@@ -0,0 +1,3 @@
+const Base = require('./base')
+
+module.exports = class extends Base {}