diff --git a/pkg/dockerfile/dockerfile.go b/pkg/dockerfile/dockerfile.go
index 5ca8f1eea2..777178f0ca 100644
--- a/pkg/dockerfile/dockerfile.go
+++ b/pkg/dockerfile/dockerfile.go
@@ -58,6 +58,11 @@ func ParseStages(opts *config.KanikoOptions) ([]instructions.Stage, []instructio
 		return nil, nil, errors.Wrap(err, "parsing dockerfile")
 	}
 
+	metaArgs, err = expandNested(metaArgs, opts.BuildArgs)
+	if err != nil {
+		return nil, nil, errors.Wrap(err, "expanding meta ARGs")
+	}
+
 	return stages, metaArgs, nil
 }
 
@@ -97,6 +102,25 @@ func Parse(b []byte) ([]instructions.Stage, []instructions.ArgCommand, error) {
 	return stages, metaArgs, nil
 }
 
+// expandNestedArgs tries to resolve nested ARG value against the previously defined ARGs
+func expandNested(metaArgs []instructions.ArgCommand, buildArgs []string) ([]instructions.ArgCommand, error) {
+	prevArgs := make([]string, 0)
+	for i := range metaArgs {
+		arg := metaArgs[i]
+		v := arg.Value
+		if v != nil {
+			val, err := util.ResolveEnvironmentReplacement(*v, append(prevArgs, buildArgs...), false)
+			if err != nil {
+				return nil, err
+			}
+			prevArgs = append(prevArgs, arg.Key+"="+val)
+			arg.Value = &val
+			metaArgs[i] = arg
+		}
+	}
+	return metaArgs, nil
+}
+
 // stripEnclosingQuotes removes quotes enclosing the value of each instructions.ArgCommand in a slice
 // if the quotes are escaped it leaves them
 func stripEnclosingQuotes(metaArgs []instructions.ArgCommand) ([]instructions.ArgCommand, error) {
diff --git a/pkg/dockerfile/dockerfile_test.go b/pkg/dockerfile/dockerfile_test.go
index 63c66f4b28..31a9652416 100644
--- a/pkg/dockerfile/dockerfile_test.go
+++ b/pkg/dockerfile/dockerfile_test.go
@@ -33,6 +33,9 @@ func Test_ParseStages_ArgValueWithQuotes(t *testing.T) {
 	dockerfile := `
 	ARG IMAGE="ubuntu:16.04"
 	ARG FOO=bar
+	ARG HELLO="Hello"
+	ARG WORLD="World"
+	ARG NESTED="$HELLO $WORLD"
 	FROM ${IMAGE}
 	RUN echo hi > /hi
 
@@ -65,11 +68,11 @@ func Test_ParseStages_ArgValueWithQuotes(t *testing.T) {
 		t.Fatal("length of stages expected to be greater than zero, but was zero")
 	}
 
-	if len(metaArgs) != 2 {
-		t.Fatalf("length of stage meta args expected to be 2, but was %d", len(metaArgs))
+	if len(metaArgs) != 5 {
+		t.Fatalf("length of stage meta args expected to be 5, but was %d", len(metaArgs))
 	}
 
-	for i, expectedVal := range []string{"ubuntu:16.04", "bar"} {
+	for i, expectedVal := range []string{"ubuntu:16.04", "bar", "Hello", "World", "Hello World"} {
 		if metaArgs[i].ValueString() != expectedVal {
 			t.Fatalf("expected metaArg %d val to be %s but was %s", i, expectedVal, metaArgs[i].ValueString())
 		}