diff --git a/docker/.env.sample b/docker/.env.sample
index 70ecee0338..aeb69bfd27 100644
--- a/docker/.env.sample
+++ b/docker/.env.sample
@@ -2,17 +2,25 @@
 ## Any environment variables supported by InvokeAI can be specified here,
 ## in addition to the examples below.
 
-# HOST_INVOKEAI_ROOT is the path on the docker host's filesystem where InvokeAI will store data.
-# Outputs will also be stored here by default.
-# If relative, it will be relative to the docker directory in which the docker-compose.yml file is located
-#HOST_INVOKEAI_ROOT=../../invokeai-data
-
-# INVOKEAI_ROOT is the path to the root of the InvokeAI repository within the container.
+## INVOKEAI_ROOT is the path *on the host system* where Invoke will store its data.
+## It is mounted into the container and allows both containerized and non-containerized usage of Invoke.
+# Usually this is the only variable you need to set. It can be relative or absolute.
 # INVOKEAI_ROOT=~/invokeai
 
-# Get this value from your HuggingFace account settings page.
-# HUGGING_FACE_HUB_TOKEN=
+## HOST_INVOKEAI_ROOT and CONTAINER_INVOKEAI_ROOT can be used to control the on-host
+## and in-container paths separately, if needed.
+## HOST_INVOKEAI_ROOT is the path on the docker host's filesystem where Invoke will store data.
+## If relative, it will be relative to the docker directory in which the docker-compose.yml file is located
+## CONTAINER_INVOKEAI_ROOT is the path within the container where Invoke will expect to find the runtime directory.
+## It MUST be absolute. There is usually no need to change this.
+# HOST_INVOKEAI_ROOT=../../invokeai-data
+# CONTAINER_INVOKEAI_ROOT=/invokeai
 
-## optional variables specific to the docker setup.
+## INVOKEAI_PORT is the port on which the InvokeAI web interface will be available
+# INVOKEAI_PORT=9090
+
+## GPU_DRIVER can be set to either `nvidia` or `rocm` to enable GPU support in the container accordingly.
 # GPU_DRIVER=nvidia #| rocm
+
+## CONTAINER_UID can be set to the UID of the user on the host system that should own the files in the container.
 # CONTAINER_UID=1000
diff --git a/docker/docker-compose.yml b/docker/docker-compose.yml
index c368eeb56d..d0a2a96c01 100644
--- a/docker/docker-compose.yml
+++ b/docker/docker-compose.yml
@@ -8,22 +8,24 @@ x-invokeai: &invokeai
       context: ..
       dockerfile: docker/Dockerfile
 
-    # variables without a default will automatically inherit from the host environment
-    environment:
-      - INVOKEAI_ROOT
-      - HF_HOME
-
     # Create a .env file in the same directory as this docker-compose.yml file
     # and populate it with environment variables. See .env.sample
     env_file:
       - .env
 
+    # variables without a default will automatically inherit from the host environment
+    environment:
+      # if set, CONTAINER_INVOKEAI_ROOT will override the Invoke runtime directory location *inside* the container
+      - INVOKEAI_ROOT=${CONTAINER_INVOKEAI_ROOT:-/invokeai}
+      - HF_HOME
     ports:
       - "${INVOKEAI_PORT:-9090}:9090"
     volumes:
       - type: bind
         source: ${HOST_INVOKEAI_ROOT:-${INVOKEAI_ROOT:-~/invokeai}}
-        target: ${INVOKEAI_ROOT:-/invokeai}
+        target: ${CONTAINER_INVOKEAI_ROOT:-/invokeai}
+        bind:
+          create_host_path: true
       - ${HF_HOME:-~/.cache/huggingface}:${HF_HOME:-/invokeai/.cache/huggingface}
       # - ${INVOKEAI_MODELS_DIR:-${INVOKEAI_ROOT:-/invokeai/models}}
       # - ${INVOKEAI_MODELS_CONFIG_PATH:-${INVOKEAI_ROOT:-/invokeai/configs/models.yaml}}