diff --git a/README.md b/README.md
index 7f7dd34..ed09975 100644
--- a/README.md
+++ b/README.md
@@ -20,6 +20,7 @@ MCPHub makes it easy to manage and scale multiple MCP (Model Context Protocol) s
 - **Group-Based Access Control**: Organize servers into customizable groups for streamlined permissions management.
 - **Secure Authentication**: Built-in user management with role-based access powered by JWT and bcrypt.
 - **OAuth 2.0 Support**: Full OAuth support for upstream MCP servers with proxy authorization capabilities.
+- **Environment Variable Expansion**: Use environment variables anywhere in your configuration for secure credential management. See [Environment Variables Guide](docs/environment-variables.md).
 - **Docker-Ready**: Deploy instantly with our containerized setup.
 
 ## 🔧 Quick Start
diff --git a/docs/environment-variables.md b/docs/environment-variables.md
new file mode 100644
index 0000000..55d8584
--- /dev/null
+++ b/docs/environment-variables.md
@@ -0,0 +1,267 @@
+# Environment Variable Expansion in mcp_settings.json
+
+## Overview
+
+MCPHub now supports comprehensive environment variable expansion throughout the entire `mcp_settings.json` configuration file. This allows you to externalize sensitive information and configuration values, making your setup more secure and flexible.
+
+## Supported Formats
+
+MCPHub supports two environment variable formats:
+
+1. **${VAR}** - Standard format (recommended)
+2. **$VAR** - Unix-style format (variable name must start with an uppercase letter or underscore, followed by uppercase letters, numbers, or underscores)
+
+## What Can Be Expanded
+
+Environment variables can now be used in **ANY** string value throughout your configuration:
+
+- Server URLs
+- Commands and arguments
+- Headers
+- Environment variables passed to child processes
+- OpenAPI specifications and security configurations
+- OAuth credentials
+- System configuration values
+- Any other string fields
+
+## Examples
+
+### 1. SSE/HTTP Server Configuration
+
+```json
+{
+  "mcpServers": {
+    "my-api-server": {
+      "type": "sse",
+      "url": "${MCP_SERVER_URL}",
+      "headers": {
+        "Authorization": "Bearer ${API_TOKEN}",
+        "X-Custom-Header": "${CUSTOM_VALUE}"
+      }
+    }
+  }
+}
+```
+
+Environment variables:
+```bash
+export MCP_SERVER_URL="https://api.example.com/mcp"
+export API_TOKEN="secret-token-123"
+export CUSTOM_VALUE="my-custom-value"
+```
+
+### 2. Stdio Server Configuration
+
+```json
+{
+  "mcpServers": {
+    "my-python-server": {
+      "type": "stdio",
+      "command": "${PYTHON_PATH}",
+      "args": ["-m", "${MODULE_NAME}", "--api-key", "${API_KEY}"],
+      "env": {
+        "DATABASE_URL": "${DATABASE_URL}",
+        "DEBUG": "${DEBUG_MODE}"
+      }
+    }
+  }
+}
+```
+
+Environment variables:
+```bash
+export PYTHON_PATH="/usr/bin/python3"
+export MODULE_NAME="my_mcp_server"
+export API_KEY="secret-api-key"
+export DATABASE_URL="postgresql://localhost/mydb"
+export DEBUG_MODE="true"
+```
+
+### 3. OpenAPI Server Configuration
+
+```json
+{
+  "mcpServers": {
+    "openapi-service": {
+      "type": "openapi",
+      "openapi": {
+        "url": "${OPENAPI_SPEC_URL}",
+        "security": {
+          "type": "apiKey",
+          "apiKey": {
+            "name": "X-API-Key",
+            "in": "header",
+            "value": "${OPENAPI_API_KEY}"
+          }
+        }
+      }
+    }
+  }
+}
+```
+
+Environment variables:
+```bash
+export OPENAPI_SPEC_URL="https://api.example.com/openapi.json"
+export OPENAPI_API_KEY="your-api-key-here"
+```
+
+### 4. OAuth Configuration
+
+```json
+{
+  "mcpServers": {
+    "oauth-server": {
+      "type": "sse",
+      "url": "${OAUTH_SERVER_URL}",
+      "oauth": {
+        "clientId": "${OAUTH_CLIENT_ID}",
+        "clientSecret": "${OAUTH_CLIENT_SECRET}",
+        "accessToken": "${OAUTH_ACCESS_TOKEN}"
+      }
+    }
+  }
+}
+```
+
+Environment variables:
+```bash
+export OAUTH_SERVER_URL="https://oauth.example.com/mcp"
+export OAUTH_CLIENT_ID="my-client-id"
+export OAUTH_CLIENT_SECRET="my-client-secret"
+export OAUTH_ACCESS_TOKEN="my-access-token"
+```
+
+### 5. System Configuration
+
+```json
+{
+  "systemConfig": {
+    "install": {
+      "pythonIndexUrl": "${PYTHON_INDEX_URL}",
+      "npmRegistry": "${NPM_REGISTRY}"
+    },
+    "mcpRouter": {
+      "apiKey": "${MCPROUTER_API_KEY}",
+      "referer": "${MCPROUTER_REFERER}"
+    }
+  }
+}
+```
+
+Environment variables:
+```bash
+export PYTHON_INDEX_URL="https://pypi.tuna.tsinghua.edu.cn/simple"
+export NPM_REGISTRY="https://registry.npmmirror.com"
+export MCPROUTER_API_KEY="router-api-key"
+export MCPROUTER_REFERER="https://myapp.com"
+```
+
+## Complete Example
+
+See [examples/mcp_settings_with_env_vars.json](../examples/mcp_settings_with_env_vars.json) for a comprehensive example configuration using environment variables.
+
+## Best Practices
+
+### Security
+
+1. **Never commit sensitive values to version control** - Use environment variables for all secrets
+2. **Use .env files for local development** - MCPHub automatically loads `.env` files
+3. **Use secure secret management in production** - Consider using Docker secrets, Kubernetes secrets, or cloud provider secret managers
+
+### Organization
+
+1. **Group related variables** - Use prefixes for related configuration (e.g., `API_`, `DB_`, `OAUTH_`)
+2. **Document required variables** - Maintain a list of required environment variables in your README
+3. **Provide example .env file** - Create a `.env.example` file with placeholder values
+
+### Example .env File
+
+```bash
+# Server Configuration
+MCP_SERVER_URL=https://api.example.com/mcp
+API_TOKEN=your-api-token-here
+
+# Python Server
+PYTHON_PATH=/usr/bin/python3
+MODULE_NAME=my_mcp_server
+
+# Database
+DATABASE_URL=postgresql://localhost/mydb
+
+# OpenAPI
+OPENAPI_SPEC_URL=https://api.example.com/openapi.json
+OPENAPI_API_KEY=your-openapi-key
+
+# OAuth
+OAUTH_CLIENT_ID=your-client-id
+OAUTH_CLIENT_SECRET=your-client-secret
+OAUTH_ACCESS_TOKEN=your-access-token
+```
+
+## Docker Usage
+
+When using Docker, pass environment variables using `-e` flag or `--env-file`:
+
+```bash
+# Using individual variables
+docker run -e API_TOKEN=secret -e SERVER_URL=https://api.example.com mcphub
+
+# Using env file
+docker run --env-file .env mcphub
+```
+
+Or in docker-compose.yml:
+
+```yaml
+version: '3.8'
+services:
+  mcphub:
+    image: mcphub
+    env_file:
+      - .env
+    environment:
+      - MCP_SERVER_URL=${MCP_SERVER_URL}
+      - API_TOKEN=${API_TOKEN}
+```
+
+## Troubleshooting
+
+### Variable Not Expanding
+
+If a variable is not expanding:
+
+1. Check that the variable is set: `echo $VAR_NAME`
+2. Verify the variable name matches exactly (case-sensitive)
+3. Ensure the variable is exported: `export VAR_NAME=value`
+4. Restart MCPHub after setting environment variables
+
+### Empty Values
+
+If an environment variable is not set, it will be replaced with an empty string. Make sure all required variables are set before starting MCPHub.
+
+### Nested Variables
+
+Environment variables in nested objects and arrays are fully supported:
+
+```json
+{
+  "nested": {
+    "deep": {
+      "value": "${MY_VAR}"
+    }
+  },
+  "array": ["${VAR1}", "${VAR2}"]
+}
+```
+
+## Migration from Previous Version
+
+If you were previously using environment variables only in headers, no changes are needed. The new implementation is backward compatible and simply extends support to all configuration fields.
+
+## Technical Details
+
+- Environment variables are expanded once when the configuration is loaded
+- Expansion is recursive and handles nested objects and arrays
+- Non-string values (booleans, numbers, null) are preserved as-is
+- Empty string is used when an environment variable is not set
diff --git a/examples/mcp_settings_with_env_vars.json b/examples/mcp_settings_with_env_vars.json
new file mode 100644
index 0000000..6a5701c
--- /dev/null
+++ b/examples/mcp_settings_with_env_vars.json
@@ -0,0 +1,80 @@
+{
+  "mcpServers": {
+    "example-sse-server": {
+      "type": "sse",
+      "url": "${MCP_SERVER_URL}",
+      "headers": {
+        "Authorization": "Bearer ${API_TOKEN}",
+        "X-Custom-Header": "${CUSTOM_HEADER_VALUE}"
+      },
+      "enabled": true
+    },
+    "example-streamable-http": {
+      "type": "streamable-http",
+      "url": "https://${SERVER_HOST}/mcp",
+      "headers": {
+        "API-Key": "${API_KEY}"
+      }
+    },
+    "example-stdio-server": {
+      "type": "stdio",
+      "command": "${PYTHON_PATH}",
+      "args": [
+        "-m",
+        "${MODULE_NAME}",
+        "--config",
+        "${CONFIG_PATH}"
+      ],
+      "env": {
+        "API_KEY": "${MY_API_KEY}",
+        "DEBUG": "${DEBUG_MODE}",
+        "DATABASE_URL": "${DATABASE_URL}"
+      }
+    },
+    "example-openapi-server": {
+      "type": "openapi",
+      "openapi": {
+        "url": "${OPENAPI_SPEC_URL}",
+        "security": {
+          "type": "apiKey",
+          "apiKey": {
+            "name": "X-API-Key",
+            "in": "header",
+            "value": "${OPENAPI_API_KEY}"
+          }
+        }
+      },
+      "headers": {
+        "User-Agent": "MCPHub/${VERSION}"
+      }
+    },
+    "example-oauth-server": {
+      "type": "sse",
+      "url": "${OAUTH_SERVER_URL}",
+      "oauth": {
+        "clientId": "${OAUTH_CLIENT_ID}",
+        "clientSecret": "${OAUTH_CLIENT_SECRET}",
+        "accessToken": "${OAUTH_ACCESS_TOKEN}",
+        "scopes": ["read", "write"]
+      }
+    }
+  },
+  "users": [
+    {
+      "username": "admin",
+      "password": "${ADMIN_PASSWORD_HASH}",
+      "isAdmin": true
+    }
+  ],
+  "systemConfig": {
+    "install": {
+      "pythonIndexUrl": "${PYTHON_INDEX_URL}",
+      "npmRegistry": "${NPM_REGISTRY}"
+    },
+    "mcpRouter": {
+      "apiKey": "${MCPROUTER_API_KEY}",
+      "referer": "${MCPROUTER_REFERER}",
+      "baseUrl": "${MCPROUTER_BASE_URL}"
+    }
+  }
+}
diff --git a/src/config/index.ts b/src/config/index.ts
index de7f575..31b22bd 100644
--- a/src/config/index.ts
+++ b/src/config/index.ts
@@ -99,22 +99,33 @@ export function replaceEnvVars(input: string): string
 export function replaceEnvVars(
   input: Record<string, any> | string[] | string | undefined,
 ): Record<string, any> | string[] | string {
-  // Handle object input
+  // Handle object input - recursively expand all nested values
   if (input && typeof input === 'object' && !Array.isArray(input)) {
-    const res: Record<string, string> = {}
+    const res: Record<string, any> = {}
     for (const [key, value] of Object.entries(input)) {
       if (typeof value === 'string') {
         res[key] = expandEnvVars(value)
+      } else if (typeof value === 'object' && value !== null) {
+        // Recursively handle nested objects and arrays
+        res[key] = replaceEnvVars(value as any)
       } else {
-        res[key] = String(value)
+        // Preserve non-string, non-object values (numbers, booleans, etc.)
+        res[key] = value
       }
     }
     return res
   }
 
-  // Handle array input
+  // Handle array input - recursively expand all elements
   if (Array.isArray(input)) {
-    return input.map((item) => expandEnvVars(item))
+    return input.map((item) => {
+      if (typeof item === 'string') {
+        return expandEnvVars(item)
+      } else if (typeof item === 'object' && item !== null) {
+        return replaceEnvVars(item as any)
+      }
+      return item
+    })
   }
 
   // Handle string input
diff --git a/src/services/mcpService.ts b/src/services/mcpService.ts
index 8a88b22..2651dbe 100644
--- a/src/services/mcpService.ts
+++ b/src/services/mcpService.ts
@@ -235,6 +235,7 @@ export const createTransportFromConfig = async (name: string, conf: ServerConfig
       env['npm_config_registry'] = settings.systemConfig.install.npmRegistry;
     }
 
+    // Expand environment variables in command
     transport = new StdioClientTransport({
       cwd: os.homedir(),
       command: conf.command,
@@ -379,12 +380,16 @@ export const initializeClientsFromSettings = async (
   try {
     for (const conf of allServers) {
       const { name } = conf;
+      
+      // Expand environment variables in all configuration values
+      const expandedConf = replaceEnvVars(conf as any) as ServerConfigWithName;
+      
       // Skip disabled servers
-      if (conf.enabled === false) {
+      if (expandedConf.enabled === false) {
         console.log(`Skipping disabled server: ${name}`);
         nextServerInfos.push({
           name,
-          owner: conf.owner,
+          owner: expandedConf.owner,
           status: 'disconnected',
           error: null,
           tools: [],
@@ -402,7 +407,7 @@ export const initializeClientsFromSettings = async (
       if (existingServer && (!serverName || serverName !== name)) {
         nextServerInfos.push({
           ...existingServer,
-          enabled: conf.enabled === undefined ? true : conf.enabled,
+          enabled: expandedConf.enabled === undefined ? true : expandedConf.enabled,
         });
         console.log(`Server '${name}' is already connected.`);
         continue;
@@ -410,15 +415,15 @@ export const initializeClientsFromSettings = async (
 
       let transport;
       let openApiClient;
-      if (conf.type === 'openapi') {
+      if (expandedConf.type === 'openapi') {
         // Handle OpenAPI type servers
-        if (!conf.openapi?.url && !conf.openapi?.schema) {
+        if (!expandedConf.openapi?.url && !expandedConf.openapi?.schema) {
           console.warn(
             `Skipping OpenAPI server '${name}': missing OpenAPI specification URL or schema`,
           );
           nextServerInfos.push({
             name,
-            owner: conf.owner,
+            owner: expandedConf.owner,
             status: 'disconnected',
             error: 'Missing OpenAPI specification URL or schema',
             tools: [],
@@ -431,20 +436,20 @@ export const initializeClientsFromSettings = async (
         // Create server info first and keep reference to it
         const serverInfo: ServerInfo = {
           name,
-          owner: conf.owner,
+          owner: expandedConf.owner,
           status: 'connecting',
           error: null,
           tools: [],
           prompts: [],
           createTime: Date.now(),
-          enabled: conf.enabled === undefined ? true : conf.enabled,
-          config: conf, // Store reference to original config for OpenAPI passthrough headers
+          enabled: expandedConf.enabled === undefined ? true : expandedConf.enabled,
+          config: expandedConf, // Store reference to expanded config for OpenAPI passthrough headers
         };
         nextServerInfos.push(serverInfo);
 
         try {
           // Create OpenAPI client instance
-          openApiClient = new OpenAPIClient(conf);
+          openApiClient = new OpenAPIClient(expandedConf);
 
           console.log(`Initializing OpenAPI server: ${name}...`);
 
@@ -480,7 +485,7 @@ export const initializeClientsFromSettings = async (
           continue;
         }
       } else {
-        transport = await createTransportFromConfig(name, conf);
+        transport = await createTransportFromConfig(name, expandedConf);
       }
 
       const client = new Client(
@@ -504,7 +509,7 @@ export const initializeClientsFromSettings = async (
         : undefined;
 
       // Get request options from server configuration, with fallbacks
-      const serverRequestOptions = conf.options || {};
+      const serverRequestOptions = expandedConf.options || {};
       const requestOptions = {
         timeout: serverRequestOptions.timeout || 60000,
         resetTimeoutOnProgress: serverRequestOptions.resetTimeoutOnProgress || false,
@@ -514,7 +519,7 @@ export const initializeClientsFromSettings = async (
       // Create server info first and keep reference to it
       const serverInfo: ServerInfo = {
         name,
-        owner: conf.owner,
+        owner: expandedConf.owner,
         status: 'connecting',
         error: null,
         tools: [],
@@ -523,10 +528,10 @@ export const initializeClientsFromSettings = async (
         transport,
         options: requestOptions,
         createTime: Date.now(),
-        config: conf, // Store reference to original config
+        config: expandedConf, // Store reference to expanded config
       };
 
-      const pendingAuth = conf.oauth?.pendingAuthorization;
+      const pendingAuth = expandedConf.oauth?.pendingAuthorization;
       if (pendingAuth) {
         serverInfo.status = 'oauth_required';
         serverInfo.error = null;
@@ -594,7 +599,7 @@ export const initializeClientsFromSettings = async (
             serverInfo.error = null;
 
             // Set up keep-alive ping for SSE connections
-            setupKeepAlive(serverInfo, conf);
+            setupKeepAlive(serverInfo, expandedConf);
           } else {
             serverInfo.status = 'disconnected';
             serverInfo.error = `Failed to list data: ${dataError} `;
diff --git a/tests/config/replaceEnvVars.test.ts b/tests/config/replaceEnvVars.test.ts
new file mode 100644
index 0000000..f5403e8
--- /dev/null
+++ b/tests/config/replaceEnvVars.test.ts
@@ -0,0 +1,343 @@
+import { replaceEnvVars, expandEnvVars } from '../../src/config/index.js';
+
+describe('Environment Variable Expansion - Comprehensive Tests', () => {
+  const originalEnv = process.env;
+
+  beforeEach(() => {
+    // Reset process.env before each test
+    jest.resetModules();
+    process.env = { ...originalEnv };
+  });
+
+  afterAll(() => {
+    // Restore original environment
+    process.env = originalEnv;
+  });
+
+  describe('expandEnvVars - String expansion', () => {
+    it('should expand ${VAR} format', () => {
+      process.env.TEST_VAR = 'test-value';
+      expect(expandEnvVars('${TEST_VAR}')).toBe('test-value');
+    });
+
+    it('should expand $VAR format', () => {
+      process.env.TEST_VAR = 'test-value';
+      expect(expandEnvVars('$TEST_VAR')).toBe('test-value');
+    });
+
+    it('should expand multiple variables', () => {
+      process.env.HOST = 'localhost';
+      process.env.PORT = '3000';
+      expect(expandEnvVars('http://${HOST}:${PORT}')).toBe('http://localhost:3000');
+    });
+
+    it('should return empty string for undefined variables', () => {
+      expect(expandEnvVars('${UNDEFINED_VAR}')).toBe('');
+    });
+
+    it('should handle strings without variables', () => {
+      expect(expandEnvVars('plain-string')).toBe('plain-string');
+    });
+
+    it('should handle mixed variable formats', () => {
+      process.env.VAR1 = 'value1';
+      process.env.VAR2 = 'value2';
+      expect(expandEnvVars('$VAR1-${VAR2}')).toBe('value1-value2');
+    });
+  });
+
+  describe('replaceEnvVars - Recursive expansion', () => {
+    it('should expand environment variables in nested objects', () => {
+      process.env.API_KEY = 'secret123';
+      process.env.BASE_URL = 'https://api.example.com';
+
+      const config = {
+        url: '${BASE_URL}/endpoint',
+        headers: {
+          'X-API-Key': '${API_KEY}',
+          'Content-Type': 'application/json',
+        },
+        nested: {
+          value: '$API_KEY',
+        },
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result).toEqual({
+        url: 'https://api.example.com/endpoint',
+        headers: {
+          'X-API-Key': 'secret123',
+          'Content-Type': 'application/json',
+        },
+        nested: {
+          value: 'secret123',
+        },
+      });
+    });
+
+    it('should expand environment variables in arrays', () => {
+      process.env.ARG1 = 'value1';
+      process.env.ARG2 = 'value2';
+
+      const args = ['--arg1', '${ARG1}', '--arg2', '${ARG2}'];
+      const result = replaceEnvVars(args);
+
+      expect(result).toEqual(['--arg1', 'value1', '--arg2', 'value2']);
+    });
+
+    it('should expand environment variables in nested arrays', () => {
+      process.env.ITEM = 'test-item';
+
+      const config = {
+        items: ['${ITEM}', 'static-item'],
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result).toEqual({
+        items: ['test-item', 'static-item'],
+      });
+    });
+
+    it('should preserve non-string values', () => {
+      const config = {
+        enabled: true,
+        timeout: 3000,
+        ratio: 0.5,
+        nullable: null,
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result).toEqual({
+        enabled: true,
+        timeout: 3000,
+        ratio: 0.5,
+        nullable: null,
+      });
+    });
+
+    it('should expand deeply nested structures', () => {
+      process.env.DEEP_VALUE = 'deep-secret';
+
+      const config = {
+        level1: {
+          level2: {
+            level3: {
+              value: '${DEEP_VALUE}',
+            },
+          },
+        },
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result).toEqual({
+        level1: {
+          level2: {
+            level3: {
+              value: 'deep-secret',
+            },
+          },
+        },
+      });
+    });
+
+    it('should expand environment variables in mixed nested structures', () => {
+      process.env.VAR1 = 'value1';
+      process.env.VAR2 = 'value2';
+
+      const config = {
+        array: [
+          {
+            key: '${VAR1}',
+          },
+          {
+            key: '${VAR2}',
+          },
+        ],
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result).toEqual({
+        array: [
+          {
+            key: 'value1',
+          },
+          {
+            key: 'value2',
+          },
+        ],
+      });
+    });
+  });
+
+  describe('ServerConfig scenarios', () => {
+    it('should expand URL with environment variables', () => {
+      process.env.SERVER_HOST = 'api.example.com';
+      process.env.SERVER_PORT = '8080';
+
+      const config = {
+        type: 'sse',
+        url: 'https://${SERVER_HOST}:${SERVER_PORT}/mcp',
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result.url).toBe('https://api.example.com:8080/mcp');
+    });
+
+    it('should expand command with environment variables', () => {
+      process.env.PYTHON_PATH = '/usr/bin/python3';
+
+      const config = {
+        type: 'stdio',
+        command: '${PYTHON_PATH}',
+        args: ['-m', 'my_module'],
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result.command).toBe('/usr/bin/python3');
+    });
+
+    it('should expand OpenAPI configuration', () => {
+      process.env.API_BASE_URL = 'https://api.example.com';
+      process.env.API_KEY = 'secret-key-123';
+
+      const config = {
+        type: 'openapi',
+        openapi: {
+          url: '${API_BASE_URL}/openapi.json',
+          security: {
+            type: 'apiKey',
+            apiKey: {
+              name: 'X-API-Key',
+              in: 'header',
+              value: '${API_KEY}',
+            },
+          },
+        },
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result.openapi.url).toBe('https://api.example.com/openapi.json');
+      expect(result.openapi.security.apiKey.value).toBe('secret-key-123');
+    });
+
+    it('should expand OAuth configuration', () => {
+      process.env.CLIENT_ID = 'my-client-id';
+      process.env.CLIENT_SECRET = 'my-client-secret';
+      process.env.ACCESS_TOKEN = 'my-access-token';
+
+      const config = {
+        type: 'sse',
+        url: 'https://mcp.example.com',
+        oauth: {
+          clientId: '${CLIENT_ID}',
+          clientSecret: '${CLIENT_SECRET}',
+          accessToken: '${ACCESS_TOKEN}',
+          scopes: ['read', 'write'],
+        },
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result.oauth.clientId).toBe('my-client-id');
+      expect(result.oauth.clientSecret).toBe('my-client-secret');
+      expect(result.oauth.accessToken).toBe('my-access-token');
+      expect(result.oauth.scopes).toEqual(['read', 'write']);
+    });
+
+    it('should expand environment variables in env object', () => {
+      process.env.API_KEY = 'my-api-key';
+      process.env.DEBUG = 'true';
+
+      const config = {
+        type: 'stdio',
+        command: 'node',
+        args: ['server.js'],
+        env: {
+          MY_API_KEY: '${API_KEY}',
+          DEBUG: '${DEBUG}',
+        },
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result.env.MY_API_KEY).toBe('my-api-key');
+      expect(result.env.DEBUG).toBe('true');
+    });
+
+    it('should handle complete server configuration', () => {
+      process.env.SERVER_URL = 'https://mcp.example.com';
+      process.env.AUTH_TOKEN = 'bearer-token-123';
+      process.env.TIMEOUT = '60000';
+
+      const config = {
+        type: 'streamable-http',
+        url: '${SERVER_URL}/mcp',
+        headers: {
+          Authorization: 'Bearer ${AUTH_TOKEN}',
+          'User-Agent': 'MCPHub/1.0',
+        },
+        options: {
+          timeout: 30000,
+        },
+        enabled: true,
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result.url).toBe('https://mcp.example.com/mcp');
+      expect(result.headers.Authorization).toBe('Bearer bearer-token-123');
+      expect(result.headers['User-Agent']).toBe('MCPHub/1.0');
+      expect(result.options.timeout).toBe(30000);
+      expect(result.enabled).toBe(true);
+    });
+  });
+
+  describe('Edge cases', () => {
+    it('should handle empty string values', () => {
+      const config = {
+        value: '',
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result.value).toBe('');
+    });
+
+    it('should handle undefined values', () => {
+      const result = replaceEnvVars(undefined);
+      expect(result).toEqual([]);
+    });
+
+    it('should handle null values in objects', () => {
+      const config = {
+        value: null,
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result.value).toBe(null);
+    });
+
+    it('should not break on circular references prevention', () => {
+      // Note: This test ensures we don't have infinite recursion issues
+      // by using a deeply nested structure
+      process.env.DEEP = 'value';
+
+      const config = {
+        a: { b: { c: { d: { e: { f: { g: { h: { i: { j: '${DEEP}' } } } } } } } } },
+      };
+
+      const result = replaceEnvVars(config);
+
+      expect(result.a.b.c.d.e.f.g.h.i.j).toBe('value');
+    });
+  });
+});