diff --git a/Mmake.workspace b/Mmake.workspace
index d9a499dde..353e94f32 100644
--- a/Mmake.workspace
+++ b/Mmake.workspace
@@ -98,7 +98,11 @@ MTAGSFLAGS +=	$(EXTRA_MTAGSFLAGS)
 
 VPATH =		$(LIBRARY_DIR)
 
-MCFLAGS +=	--config-file $(SCRIPTS_DIR)/Mercury.config
+ifeq ($(origin MERCURY_CONFIG_FILE),undefined)
+MERCURY_CONFIG_FILE =	$(SCRIPTS_DIR)/Mercury.config.bootstrap
+endif
+
+MCFLAGS +=	--config-file $(MERCURY_CONFIG_FILE)
 
 ifeq ($(MMAKE_USE_MMC_MAKE),yes)
 MCFLAGS +=	--options-file $(WORKSPACE)/Mercury.options
diff --git a/configure.in b/configure.in
index 6735a12f0..509f6b5ca 100644
--- a/configure.in
+++ b/configure.in
@@ -3574,7 +3574,8 @@ scripts/mercury.bat scripts/mprof scripts/mercury_update_interface
 scripts/mgnuc scripts/parse_ml_options.sh-subr scripts/ml
 scripts/c2init scripts/mmake scripts/mdb scripts/mdbrc scripts/mdprof
 scripts/mkfifo_using_mknod bindist/bindist.INSTALL bindist/bindist.Makefile
-scripts/mercury_config scripts/Mercury.config tools/lmc tools/dotime
+scripts/mercury_config scripts/Mercury.config scripts/Mercury.config.bootstrap
+tools/lmc tools/dotime
 ,
 [
 # Only do this when compiling the source, not when reconfiguring
diff --git a/scripts/Mercury.config.bootstrap.in b/scripts/Mercury.config.bootstrap.in
new file mode 100644
index 000000000..65c851fc4
--- /dev/null
+++ b/scripts/Mercury.config.bootstrap.in
@@ -0,0 +1,92 @@
+#! /bin/sh
+# @configure_input@
+#---------------------------------------------------------------------------#
+# Copyright (C) 2003 The University of Melbourne.
+# This file may only be copied under the terms of the GNU General
+# Public License - see the file COPYING in the Mercury distribution.
+#---------------------------------------------------------------------------#
+#
+# Mercury.config.bootstrap
+#
+# Configuration file for the Melbourne Mercury Compiler.
+#
+# This file is used instead of Mercury.config when building the
+# stage1 compiler. It should only refer to options which are
+# understood by the installed compilers.
+#
+# Environment variables: MERCURY_STDLIB_DIR, MERCURY_C_COMPILER,
+# MERCURY_DEFAULT_GRADE, MERCURY_DEFAULT_OPT_LEVEL.
+
+# These settings won't override settings in the environment.
+MERCURY_STDLIB_DIR=@LIBDIR@
+MERCURY_DEFAULT_OPT_LEVEL=-O2
+MERCURY_DEFAULT_GRADE=@DEFAULT_GRADE@
+MERCURY_C_COMPILER=@CC@
+MERCURY_MATH_LIB=@MATH_LIB@
+# $(MATH_LIB) needs to be defined because it may
+# be used by the substitution for SHARED_LIBS.
+MATH_LIB=$(MERCURY_MATH_LIB)
+
+DEFAULT_MERCURY_LINKAGE=@DEFAULT_LINKAGE@
+
+# The default optimization level should be after
+# all the options that describe the machine configuration.
+DEFAULT_MCFLAGS=\
+		@ALL_LOCAL_C_INCL_DIR_MMC_OPTS@ \
+		@ALL_LOCAL_C_LIB_DIR_MMC_OPTS@ \
+		--cc "$(MERCURY_C_COMPILER)" \
+		--grade "$(MERCURY_DEFAULT_GRADE)" \
+		--cflags-for-ansi "@CFLAGS_FOR_ANSI@" \
+		--cflags-for-optimization "@CFLAGS_FOR_OPT@" \
+		--cflags-for-warnings "@CFLAGS_FOR_WARNINGS@" \
+		--cflags-for-threads "@CFLAGS_FOR_THREADS@" \
+		--cflags-for-debug "@CFLAGS_FOR_DEBUG@" \
+		--cflags-for-regs "@CFLAGS_FOR_REGS@" \
+		--cflags-for-gotos "@CFLAGS_FOR_GOTOS@" \
+		--cflags-for-pic "@CFLAGS_FOR_PIC@" \
+		--c-flag-to-name-object-file "@OBJFILE_OPT@" \
+		--object-file-extension ".@OBJ_SUFFIX@" \
+		--pic-object-file-extension ".@EXT_FOR_PIC_OBJECTS@" \
+		--link-with-pic-object-file-extension ".@EXT_FOR_LINK_WITH_PIC_OBJECTS@" \
+		--executable-file-extension "@EXT_FOR_EXE@" \
+		--shared-library-extension ".@EXT_FOR_SHARED_LIB@" \
+		--library-extension ".@LIB_SUFFIX@" \
+		--create-archive-command "@AR@" \
+		--create-archive-command-output-flag "@AR_LIBFILE_OPT@" \
+		--create-archive-command-flags "@ARFLAGS@" \
+		--ranlib-command "@RANLIB@" \
+		--link-executable-command "@LINK_EXE@" \
+		--link-shared-lib-command "@LINK_SHARED_OBJ@" \
+		--trace-libs "@TRACE_LIBS_SYSTEM@" \
+		--thread-libs "@THREAD_LIBS@" \
+		--shared-libs "@SHARED_LIBS@" \
+		--math-lib "@MATH_LIB@" \
+		--readline-libs "@READLINE_LIBRARIES@" \
+		--linker-thread-flags "@LDFLAGS_FOR_THREADS@" \
+		--shlib-linker-thread-flags "@LD_LIBFLAGS_FOR_THREADS@" \
+		--linker-trace-flags "@LDFLAGS_FOR_TRACE@" \
+		--shlib-linker-trace-flags "@LD_LIBFLAGS_FOR_TRACE@" \
+		--linker-static-flags "@LD_STATIC_FLAGS@" \
+		--linker-strip-flag "@LD_STRIP_FLAG@" \
+		--linker-debug-flags "@LDFLAGS_FOR_DEBUG@" \
+		--shlib-linker-debug-flags "@LD_LIBFLAGS_FOR_DEBUG@" \
+		--linker-rpath-flag "@EXE_RPATH_OPT@" \
+		--linker-rpath-separator "@EXE_RPATH_SEP@" \
+		--shlib-linker-rpath-flag "@SHLIB_RPATH_OPT@" \
+		--shlib-linker-rpath-separator "@SHLIB_RPATH_SEP@" \
+		--linker-allow-undefined-flag "@ALLOW_UNDEFINED@" \
+		--linker-error-undefined-flag "@ERROR_UNDEFINED@" \
+		--fullarch "@FULLARCH@" \
+		--install-prefix "@prefix@" \
+		--num-real-r-regs "@NUM_REAL_R_REGS@" \
+		--num-real-r-temps "@NUM_REAL_R_TEMPS@" \
+		--conf-low-tag-bits "@LOW_TAG_BITS@" \
+		--bits-per-word "@BITS_PER_WORD@" \
+		--bytes-per-word "@BYTES_PER_WORD@" \
+		--dotnet-library-version "@MS_DOTNET_LIBRARY_VERSION@" \
+		@HAVE_DELAY_SLOT@ \
+		@HAVE_BOXED_FLOATS@ \
+		@MCFLAGS_FOR_CC@ \
+		$(MERCURY_DEFAULT_OPT_LEVEL) \
+		@LIBGRADE_OPTS@ 
+
diff --git a/scripts/Mercury.config.in b/scripts/Mercury.config.in
index a89a73dbd..f8c46800c 100644
--- a/scripts/Mercury.config.in
+++ b/scripts/Mercury.config.in
@@ -10,6 +10,9 @@
 #
 # Configuration file for the Melbourne Mercury Compiler.
 #
+# Note to developers: when updating this file consider whether
+# Mercury.config.bootstrap.in should also be updated.
+#
 # Environment variables: MERCURY_STDLIB_DIR, MERCURY_C_COMPILER,
 # MERCURY_DEFAULT_GRADE, MERCURY_DEFAULT_OPT_LEVEL.
 
diff --git a/scripts/Mmakefile b/scripts/Mmakefile
index c6bb9e2d7..d31f4fff5 100644
--- a/scripts/Mmakefile
+++ b/scripts/Mmakefile
@@ -34,7 +34,7 @@ EMACS_SCRIPTS = gud.el
 
 .PHONY: all
 all: $(SCRIPTS) $(DEBUGGER_SCRIPTS) $(EMACS_SCRIPTS)
-all: Mmake.vars Mercury.config
+all: Mmake.vars Mercury.config Mercury.config.bootstrap
 
 #-----------------------------------------------------------------------------#
 
diff --git a/scripts/mercury_config.in b/scripts/mercury_config.in
index cb6cba033..f71769600 100644
--- a/scripts/mercury_config.in
+++ b/scripts/mercury_config.in
@@ -126,6 +126,7 @@ cp -r $input_libdir/reconf/* $TMPDIR || exit 1
 mkdir $TMPDIR/bindist || exit 1
 
 # The configure script tries to process these files, but they won't be used.
+touch $TMPDIR/scripts/Mercury.config.bootstrap.in || exit 1
 touch $TMPDIR/Mmake.common.in $TMPDIR/bindist/bindist.INSTALL.in || exit 1
 touch $TMPDIR/bindist/bindist.Makefile.in || exit 1
 
diff --git a/tools/binary_step b/tools/binary_step
index 86f760a39..036db95d3 100755
--- a/tools/binary_step
+++ b/tools/binary_step
@@ -148,6 +148,9 @@ root=`/bin/pwd`
 MERCURY_COMPILER=$root/compiler/mercury_compile
 export MERCURY_COMPILER
 
+MERCURY_CONFIG_FILE=$root/scripts/Mercury.config
+export MERCURY_CONFIG_FILE
+
 MMAKE_VPATH=.
 export MMAKE_VPATH
 MMAKE_DIR=../scripts
diff --git a/tools/bootcheck b/tools/bootcheck
index 99c089ba3..a8e4b0073 100755
--- a/tools/bootcheck
+++ b/tools/bootcheck
@@ -457,6 +457,9 @@ then
 	MERCURY_COMPILER=$root/compiler/mercury_compile
 	export MERCURY_COMPILER
 
+	MERCURY_CONFIG_FILE=$root/scripts/Mercury.config
+	export MERCURY_CONFIG_FILE
+
 	[ -d stage2 ] || mkdir stage2
 	if $keep_stage_2
 	then
@@ -1047,6 +1050,9 @@ then
 	MERCURY_COMPILER=$root/stage2/compiler/mercury_compile
 	export MERCURY_COMPILER
 
+	MERCURY_CONFIG_FILE=$root/scripts/Mercury.config
+	export MERCURY_CONFIG_FILE
+
 	if test "$test_grade" = "$grade"
 	then
 		stage2_insert="/stage2"
diff --git a/tools/lmc.in b/tools/lmc.in
index be817f2b2..ecc1ef27d 100755
--- a/tools/lmc.in
+++ b/tools/lmc.in
@@ -108,4 +108,4 @@ fi
 
 PATH="$WORKSPACE/scripts:$WORKSPACE/util:$PATH"
 export PATH
-exec mmc --no-mercury-stdlib-dir -I $WORKSPACE/library -I $WORKSPACE/analysis $CDEBUG_FLAGS $C_FLAGS $INIT_FLAGS $LIB_FLAGS "$@"
+exec mmc --no-mercury-stdlib-dir --config-file $WORKSPACE/scripts/Mercury.config -I $WORKSPACE/library -I $WORKSPACE/analysis $CDEBUG_FLAGS $C_FLAGS $INIT_FLAGS $LIB_FLAGS "$@"