diff -r 25e3dac511f0 -r 91ab5190a3de rust/hg-core/src/config/layer.rs
--- a/rust/hg-core/src/config/layer.rs	Mon Mar 08 08:55:48 2021 +0100
+++ b/rust/hg-core/src/config/layer.rs	Mon Mar 08 15:35:32 2021 +0100
@@ -150,6 +150,7 @@
             let line = Some(index + 1);
             if let Some(m) = INCLUDE_RE.captures(&bytes) {
                 let filename_bytes = &m[1];
+                let filename_bytes = crate::utils::expand_vars(filename_bytes);
                 // `Path::parent` only fails for the root directory,
                 // which `src` can’t be since we’ve managed to open it as a
                 // file.