diff --git a/docs/content/2.guide/2.features/10.app-config.md b/docs/content/2.guide/2.features/10.app-config.md
new file mode 100644
index 00000000000..c3544181514
--- /dev/null
+++ b/docs/content/2.guide/2.features/10.app-config.md
@@ -0,0 +1,55 @@
+# App Config
+
+::StabilityEdge
+::
+
+Nuxt 3 provides an `app.config` config file to expose reactive configuration within your application with the ability to update it at runtime within lifecycle or using a nuxt plugin and editing it with HMR (hot-module-replacement).
+
+::alert{type=warning}
+Do not put any secret values inside `app.config` file. It is exposed to the user client bundle.
+::
+
+## Defining App Config
+
+To expose config and environment variables to the rest of your app, you will need to define configuration in `app.config` file.
+
+**Example:**
+
+```ts [app.config.ts]
+export default defineAppConfig({
+  theme: {
+    primaryColor: '#ababab'
+  }
+})
+```
+
+When adding `theme` to the `app.config`, Nuxt uses Vite or Webpack to bundle the code. We can universally access `theme` in both server and browser using [useAppConfig](/api/composables/use-app-config) composable.
+
+```js
+const appConfig = useAppConfig()
+
+console.log(appConfig.theme)
+```
+
+<!-- TODO: Document module author for extension -->
+
+### Manually Typing App Config
+
+Nuxt tries to automatically generate a typescript interface from provided app config.
+
+It is also possible to type app config manually:
+
+```ts [index.d.ts]
+declare module '@nuxt/schema' {
+  interface AppConfig {
+    /** Theme configuration */
+    theme: {
+      /** Primary app color */
+      primaryColor: string
+    }
+  }
+}
+
+// It is always important to ensure you import/export something when augmenting a type
+export {}
+```
diff --git a/docs/content/2.guide/3.directory-structure/16.app.config.md b/docs/content/2.guide/3.directory-structure/16.app.config.md
new file mode 100644
index 00000000000..61bfbf510da
--- /dev/null
+++ b/docs/content/2.guide/3.directory-structure/16.app.config.md
@@ -0,0 +1,24 @@
+---
+icon: IconFile
+title: app.config.ts
+head.title: Nuxt App Config
+---
+
+# Nuxt App Config
+
+::StabilityEdge
+::
+
+You can easily provide runtime app configuration using `app.config.ts` file. It can have either of `.ts`, `.js`, or `.mjs` extensions.
+
+```ts [app.config.ts]
+export default defineAppConfig({
+  foo: 'bar'
+})
+```
+
+::alert{type=warning}
+Do not put any secret values inside `app.config` file. It is exposed to the user client bundle.
+::
+
+::ReadMore{link="/guide/features/app-config"}
diff --git a/docs/content/3.api/1.composables/use-app-config.md b/docs/content/3.api/1.composables/use-app-config.md
new file mode 100644
index 00000000000..72c0dd5033f
--- /dev/null
+++ b/docs/content/3.api/1.composables/use-app-config.md
@@ -0,0 +1,16 @@
+# `useAppConfig`
+
+::StabilityEdge
+::
+
+Access [app config](/guide/features/app-config):
+
+**Usage:**
+
+```js
+const appConfig = useAppConfig()
+
+console.log(appConfig)
+```
+
+::ReadMore{link="/guide/features/app-config"}
diff --git a/examples/advanced/config-extends/app.config.ts b/examples/advanced/config-extends/app.config.ts
new file mode 100644
index 00000000000..909ae0dc97f
--- /dev/null
+++ b/examples/advanced/config-extends/app.config.ts
@@ -0,0 +1,5 @@
+export default defineAppConfig({
+  foo: 'user',
+  bar: 'user',
+  baz: 'base'
+})
diff --git a/examples/advanced/config-extends/base/app.config.ts b/examples/advanced/config-extends/base/app.config.ts
new file mode 100644
index 00000000000..b94ce0b0b05
--- /dev/null
+++ b/examples/advanced/config-extends/base/app.config.ts
@@ -0,0 +1,4 @@
+export default defineAppConfig({
+  bar: 'base',
+  baz: 'base'
+})
diff --git a/examples/advanced/config-extends/pages/index.vue b/examples/advanced/config-extends/pages/index.vue
index 549b1d0dc59..1c754df8549 100644
--- a/examples/advanced/config-extends/pages/index.vue
+++ b/examples/advanced/config-extends/pages/index.vue
@@ -1,12 +1,15 @@
 <script setup>
 const themeConfig = useRuntimeConfig().theme
+const appConfig = useAppConfig()
 const foo = useFoo()
 const bar = getBar()
 </script>
 
 <template>
   <NuxtExampleLayout example="advanced/config-extends">
-    theme runtimeConfig
+    appConfig:
+    <pre>{{ JSON.stringify(appConfig, null, 2) }}</pre>
+    runtimeConfig:
     <pre>{{ JSON.stringify(themeConfig, null, 2) }}</pre>
     <BaseButton>Base Button</BaseButton>
     <FancyButton>Fancy Button</FancyButton>
diff --git a/packages/nuxi/src/commands/dev.ts b/packages/nuxi/src/commands/dev.ts
index b7dc1767fed..d63de0dbe06 100644
--- a/packages/nuxi/src/commands/dev.ts
+++ b/packages/nuxi/src/commands/dev.ts
@@ -132,7 +132,7 @@ export default defineNuxtCommand({
           dLoad(true, `Directory \`${relativePath}/\` ${event === 'addDir' ? 'created' : 'removed'}`)
         }
       } else if (isFileChange) {
-        if (file.match(/(app|error)\.(js|ts|mjs|jsx|tsx|vue)$/)) {
+        if (file.match(/(app|error|app\.config)\.(js|ts|mjs|jsx|tsx|vue)$/)) {
           dLoad(true, `\`${relativePath}\` ${event === 'add' ? 'created' : 'removed'}`)
         }
       }
diff --git a/packages/nuxt/src/app/config.ts b/packages/nuxt/src/app/config.ts
new file mode 100644
index 00000000000..d8f97df8174
--- /dev/null
+++ b/packages/nuxt/src/app/config.ts
@@ -0,0 +1,48 @@
+import type { AppConfig } from '@nuxt/schema'
+import { reactive } from 'vue'
+import { useNuxtApp } from './nuxt'
+// @ts-ignore
+import __appConfig from '#build/app.config.mjs'
+
+// Workaround for vite HMR with virtual modules
+export const _getAppConfig = () => __appConfig as AppConfig
+
+export function useAppConfig (): AppConfig {
+  const nuxtApp = useNuxtApp()
+  if (!nuxtApp._appConfig) {
+    nuxtApp._appConfig = reactive(__appConfig) as AppConfig
+  }
+  return nuxtApp._appConfig
+}
+
+// HMR Support
+if (process.dev) {
+  function applyHMR (newConfig: AppConfig) {
+    const appConfig = useAppConfig()
+    if (newConfig && appConfig) {
+      for (const key in newConfig) {
+        (appConfig as any)[key] = (newConfig as any)[key]
+      }
+      for (const key in appConfig) {
+        if (!(key in newConfig)) {
+          delete (appConfig as any)[key]
+        }
+      }
+    }
+  }
+
+  // Vite
+  if (import.meta.hot) {
+    import.meta.hot.accept((newModule) => {
+      const newConfig = newModule._getAppConfig()
+      applyHMR(newConfig)
+    })
+  }
+
+  // Webpack
+  if (import.meta.webpackHot) {
+    import.meta.webpackHot.accept('#build/app.config.mjs', () => {
+      applyHMR(__appConfig)
+    })
+  }
+}
diff --git a/packages/nuxt/src/app/index.ts b/packages/nuxt/src/app/index.ts
index b229b5e33e9..b32deafde28 100644
--- a/packages/nuxt/src/app/index.ts
+++ b/packages/nuxt/src/app/index.ts
@@ -3,6 +3,7 @@
 export * from './nuxt'
 export * from './composables'
 export * from './components'
+export * from './config'
 
 // eslint-disable-next-line import/no-restricted-paths
 export type { PageMeta } from '../pages/runtime'
diff --git a/packages/nuxt/src/app/nuxt.ts b/packages/nuxt/src/app/nuxt.ts
index b24bda3c8d5..458d92b732c 100644
--- a/packages/nuxt/src/app/nuxt.ts
+++ b/packages/nuxt/src/app/nuxt.ts
@@ -2,7 +2,7 @@
 import { getCurrentInstance, reactive } from 'vue'
 import type { App, onErrorCaptured, VNode } from 'vue'
 import { createHooks, Hookable } from 'hookable'
-import type { RuntimeConfig } from '@nuxt/schema'
+import type { RuntimeConfig, AppConfigInput } from '@nuxt/schema'
 import { getContext } from 'unctx'
 import type { SSRContext } from 'vue-bundle-renderer/runtime'
 import type { CompatibilityEvent } from 'h3'
@@ -281,3 +281,7 @@ export function useRuntimeConfig (): RuntimeConfig {
 function defineGetter<K extends string | number | symbol, V> (obj: Record<K, V>, key: K, val: V) {
   Object.defineProperty(obj, key, { get: () => val })
 }
+
+export function defineAppConfig<C extends AppConfigInput> (config: C): C {
+  return config
+}
diff --git a/packages/nuxt/src/auto-imports/presets.ts b/packages/nuxt/src/auto-imports/presets.ts
index 81d94856c4f..e9ca159bfda 100644
--- a/packages/nuxt/src/auto-imports/presets.ts
+++ b/packages/nuxt/src/auto-imports/presets.ts
@@ -1,6 +1,6 @@
 import { defineUnimportPreset, Preset } from 'unimport'
 
-export const commonPresets: Preset[] = [
+const commonPresets: Preset[] = [
   // #head
   defineUnimportPreset({
     from: '#head',
@@ -19,7 +19,7 @@ export const commonPresets: Preset[] = [
   })
 ]
 
-export const appPreset = defineUnimportPreset({
+const appPreset = defineUnimportPreset({
   from: '#app',
   imports: [
     'useAsyncData',
@@ -49,12 +49,14 @@ export const appPreset = defineUnimportPreset({
     'isNuxtError',
     'useError',
     'createError',
-    'defineNuxtLink'
+    'defineNuxtLink',
+    'useAppConfig',
+    'defineAppConfig'
   ]
 })
 
 // vue
-export const vuePreset = defineUnimportPreset({
+const vuePreset = defineUnimportPreset({
   from: 'vue',
   imports: [
     // <script setup>
diff --git a/packages/nuxt/src/core/app.ts b/packages/nuxt/src/core/app.ts
index 8af1db8ddd8..9baf3bed20c 100644
--- a/packages/nuxt/src/core/app.ts
+++ b/packages/nuxt/src/core/app.ts
@@ -115,6 +115,15 @@ export async function resolveApp (nuxt: Nuxt, app: NuxtApp) {
   app.middleware = uniqueBy(await resolvePaths(app.middleware, 'path'), 'name')
   app.plugins = uniqueBy(await resolvePaths(app.plugins, 'src'), 'src')
 
+  // Resolve app.config
+  app.configs = []
+  for (const config of nuxt.options._layers.map(layer => layer.config)) {
+    const appConfigPath = await findPath(resolve(config.srcDir, 'app.config'))
+    if (appConfigPath) {
+      app.configs.push(appConfigPath)
+    }
+  }
+
   // Extend app
   await nuxt.callHook('app:resolve', app)
 
diff --git a/packages/nuxt/src/core/nuxt.ts b/packages/nuxt/src/core/nuxt.ts
index 730eb763efd..f28d634238e 100644
--- a/packages/nuxt/src/core/nuxt.ts
+++ b/packages/nuxt/src/core/nuxt.ts
@@ -54,6 +54,7 @@ async function initNuxt (nuxt: Nuxt) {
     }
     // Add module augmentations directly to NuxtConfig
     opts.references.push({ path: resolve(nuxt.options.buildDir, 'types/schema.d.ts') })
+    opts.references.push({ path: resolve(nuxt.options.buildDir, 'types/app.config.d.ts') })
   })
 
   // Add import protection
diff --git a/packages/nuxt/src/core/templates.ts b/packages/nuxt/src/core/templates.ts
index b8209b3be1d..15201d8e795 100644
--- a/packages/nuxt/src/core/templates.ts
+++ b/packages/nuxt/src/core/templates.ts
@@ -124,7 +124,7 @@ export const schemaTemplate: NuxtTemplate<TemplateContext> = {
       "declare module '@nuxt/schema' {",
       '  interface NuxtConfig {',
       ...moduleInfo.filter(Boolean).map(meta =>
-      `    [${genString(meta.configKey)}]?: typeof ${genDynamicImport(meta.importName, { wrapper: false })}.default extends NuxtModule<infer O> ? Partial<O> : Record<string, any>`
+        `    [${genString(meta.configKey)}]?: typeof ${genDynamicImport(meta.importName, { wrapper: false })}.default extends NuxtModule<infer O> ? Partial<O> : Record<string, any>`
       ),
       '  }',
       generateTypes(resolveSchema(Object.fromEntries(Object.entries(nuxt.options.runtimeConfig).filter(([key]) => key !== 'public'))),
@@ -157,7 +157,7 @@ export const layoutTemplate: NuxtTemplate<TemplateContext> = {
     }))
     return [
       'import { defineAsyncComponent } from \'vue\'',
-          `export default ${layoutsObject}`
+      `export default ${layoutsObject}`
     ].join('\n')
   }
 }
@@ -184,7 +184,39 @@ export const useRuntimeConfig = () => window?.__NUXT__?.config || {}
 `
 }
 
-export const publicPathTemplate: NuxtTemplate<TemplateContext> = {
+export const appConfigDeclarationTemplate: NuxtTemplate = {
+  filename: 'types/app.config.d.ts',
+  getContents: ({ app, nuxt }) => {
+    return `
+import type { Defu } from 'defu'
+${app.configs.map((id: string, index: number) => `import ${`cfg${index}`} from ${JSON.stringify(id.replace(/(?<=\w)\.\w+$/g, ''))}`).join('\n')}
+
+declare const inlineConfig = ${JSON.stringify(nuxt.options.appConfig, null, 2)}
+type ResolvedAppConfig = Defu<typeof inlineConfig, [${app.configs.map((_id: string, index: number) => `typeof cfg${index}`).join(', ')}]>
+
+declare module '@nuxt/schema' {
+  interface AppConfig extends ResolvedAppConfig { }
+}
+`
+  }
+}
+
+export const appConfigTemplate: NuxtTemplate = {
+  filename: 'app.config.mjs',
+  write: true,
+  getContents: ({ app, nuxt }) => {
+    return `
+import defu from 'defu'
+
+const inlineConfig = ${JSON.stringify(nuxt.options.appConfig, null, 2)}
+
+${app.configs.map((id: string, index: number) => `import ${`cfg${index}`} from ${JSON.stringify(id)}`).join('\n')}
+export default defu(${app.configs.map((_id: string, index: number) => `cfg${index}`).concat(['inlineConfig']).join(', ')})
+`
+  }
+}
+
+export const publicPathTemplate: NuxtTemplate = {
   filename: 'paths.mjs',
   getContents ({ nuxt }) {
     return [
diff --git a/packages/schema/src/config/_common.ts b/packages/schema/src/config/_common.ts
index ba1ade34d91..e69f134e119 100644
--- a/packages/schema/src/config/_common.ts
+++ b/packages/schema/src/config/_common.ts
@@ -747,5 +747,16 @@ export default {
    * @version 3
    * @deprecated Use `runtimeConfig` option with `public` key (`runtimeConfig.public.*`).
    */
-  publicRuntimeConfig: {}
+  publicRuntimeConfig: {},
+
+  /**
+   * Additional app configuration
+   *
+   * For programmatic usage and type support, you can directly provide app config with this option.
+   * It will be merged with `app.config` file as default value.
+   *
+   * @type {typeof import('../src/types/config').AppConfig}
+   * @version 3
+   */
+   appConfig: {},
 }
diff --git a/packages/schema/src/types/config.ts b/packages/schema/src/types/config.ts
index 176ab8f540b..66b902a4f92 100644
--- a/packages/schema/src/types/config.ts
+++ b/packages/schema/src/types/config.ts
@@ -27,31 +27,48 @@ export interface NuxtOptions extends ConfigSchema {
   _layers: NuxtConfigLayer[]
 }
 
-type RuntimeConfigNamespace = Record<string, any>
-
-export interface PublicRuntimeConfig extends RuntimeConfigNamespace { }
-
-// TODO: remove before release of 3.0.0
-/** @deprecated use RuntimeConfig interface */
-export interface PrivateRuntimeConfig extends RuntimeConfigNamespace { }
-
-export interface RuntimeConfig extends PrivateRuntimeConfig, RuntimeConfigNamespace {
-  public: PublicRuntimeConfig
-}
-
 export interface ViteConfig extends ViteUserConfig {
   /**
    * Options passed to @vitejs/plugin-vue
    * @see https://github.com/vitejs/vite/tree/main/packages/plugin-vue
    */
   vue?: VuePluginOptions
+
   /**
    * Bundler for dev time server-side rendering.
    * @default 'vite-node'
    */
   devBundler?: 'vite-node' | 'legacy',
+
   /**
    * Warmup vite entrypoint caches on dev startup.
    */
   warmupEntry?: boolean
 }
+
+
+// -- Runtime Config --
+
+type RuntimeConfigNamespace = Record<string, any>
+
+export interface PublicRuntimeConfig extends RuntimeConfigNamespace { }
+
+// TODO: remove before release of 3.0.0
+/** @deprecated use RuntimeConfig interface */
+export interface PrivateRuntimeConfig extends RuntimeConfigNamespace { }
+
+export interface RuntimeConfig extends PrivateRuntimeConfig, RuntimeConfigNamespace {
+  public: PublicRuntimeConfig
+}
+
+// -- App Config --
+export interface AppConfigInput extends Record<string, any> {
+  /** @deprecated reserved */
+  private?: never
+  /** @deprecated reserved */
+  nuxt?: never
+  /** @deprecated reserved */
+  nitro?: never
+}
+
+export interface AppConfig { }
diff --git a/packages/schema/src/types/nuxt.ts b/packages/schema/src/types/nuxt.ts
index 4f0ac743a91..926625565f0 100644
--- a/packages/schema/src/types/nuxt.ts
+++ b/packages/schema/src/types/nuxt.ts
@@ -60,6 +60,7 @@ export interface NuxtApp {
   layouts: Record<string, NuxtLayout>
   middleware: NuxtMiddleware[]
   templates: NuxtTemplate[]
+  configs: string[]
 }
 
 type _TemplatePlugin = Omit<NuxtPlugin, 'src'> & NuxtTemplate
diff --git a/test/basic.test.ts b/test/basic.test.ts
index cb5a170d137..4b04883246e 100644
--- a/test/basic.test.ts
+++ b/test/basic.test.ts
@@ -449,4 +449,28 @@ describe('dynamic paths', () => {
       ).toBeTruthy()
     }
   })
+
+  it('restore server', async () => {
+    process.env.NUXT_APP_BASE_URL = undefined
+    process.env.NUXT_APP_CDN_URL = undefined
+    process.env.NUXT_APP_BUILD_ASSETS_DIR = undefined
+    await startServer()
+  })
+})
+
+describe('app config', () => {
+  it('should work', async () => {
+    const html = await $fetch('/app-config')
+
+    const expectedAppConfig = {
+      fromNuxtConfig: true,
+      nested: {
+        val: 2
+      },
+      fromLayer: true,
+      userConfig: 123
+    }
+
+    expect(html).toContain(JSON.stringify(expectedAppConfig))
+  })
 })
diff --git a/test/fixtures/basic/app.config.ts b/test/fixtures/basic/app.config.ts
new file mode 100644
index 00000000000..2bb6b31bd5c
--- /dev/null
+++ b/test/fixtures/basic/app.config.ts
@@ -0,0 +1,6 @@
+export default defineAppConfig({
+  userConfig: 123,
+  nested: {
+    val: 2
+  }
+})
diff --git a/test/fixtures/basic/extends/bar/app.config.ts b/test/fixtures/basic/extends/bar/app.config.ts
new file mode 100644
index 00000000000..92e47a3736d
--- /dev/null
+++ b/test/fixtures/basic/extends/bar/app.config.ts
@@ -0,0 +1,3 @@
+export default {
+  fromLayer: true
+}
diff --git a/test/fixtures/basic/nuxt.config.ts b/test/fixtures/basic/nuxt.config.ts
index 331e50799ab..6063257afbe 100644
--- a/test/fixtures/basic/nuxt.config.ts
+++ b/test/fixtures/basic/nuxt.config.ts
@@ -37,5 +37,11 @@ export default defineNuxtConfig({
   experimental: {
     reactivityTransform: true,
     treeshakeClientOnly: true
+  },
+  appConfig: {
+    fromNuxtConfig: true,
+    nested: {
+      val: 1
+    }
   }
 })
diff --git a/test/fixtures/basic/pages/app-config.vue b/test/fixtures/basic/pages/app-config.vue
new file mode 100644
index 00000000000..fe26ddcacf8
--- /dev/null
+++ b/test/fixtures/basic/pages/app-config.vue
@@ -0,0 +1,11 @@
+<template>
+  <div>
+    App Config:
+    <!-- eslint-disable-next-line vue/no-v-html -->
+    <pre v-html="JSON.stringify(appConfig)" />
+  </div>
+</template>
+
+<script setup lang="ts">
+const appConfig = useAppConfig()
+</script>
diff --git a/test/fixtures/basic/types.ts b/test/fixtures/basic/types.ts
index 85e5f89ee0d..618bc6310f7 100644
--- a/test/fixtures/basic/types.ts
+++ b/test/fixtures/basic/types.ts
@@ -1,6 +1,7 @@
 import { expectTypeOf } from 'expect-type'
 import { describe, it } from 'vitest'
 import type { Ref } from 'vue'
+import type { AppConfig } from '@nuxt/schema'
 
 import { NavigationFailure, RouteLocationNormalizedLoaded, RouteLocationRaw, useRouter as vueUseRouter } from 'vue-router'
 import { defineNuxtConfig } from '~~/../../../packages/nuxt/src'
@@ -165,3 +166,17 @@ describe('composables', () => {
       .toEqualTypeOf(useLazyAsyncData(() => Promise.resolve({ foo: Math.random() }), { transform: data => data.foo }))
   })
 })
+
+describe('app config', () => {
+  it('merges app config as expected', () => {
+    interface ExpectedMergedAppConfig {
+      fromLayer: boolean,
+      fromNuxtConfig: boolean,
+      nested: {
+        val: number
+      },
+      userConfig: number
+    }
+    expectTypeOf<AppConfig>().toMatchTypeOf<ExpectedMergedAppConfig>()
+  })
+})