diff --git a/internal/cloud/e2e/apply_auto_approve_test.go b/internal/cloud/e2e/apply_auto_approve_test.go
index 8ece4836dd..4e5a65a022 100644
--- a/internal/cloud/e2e/apply_auto_approve_test.go
+++ b/internal/cloud/e2e/apply_auto_approve_test.go
@@ -5,10 +5,8 @@ package main
 
 import (
 	"context"
-	"fmt"
 	"io/ioutil"
 	"log"
-	"os"
 	"strings"
 	"testing"
 
@@ -238,15 +236,3 @@ func Test_terraform_apply_autoApprove(t *testing.T) {
 		tc.validations(t, orgName, wsName)
 	}
 }
-
-func writeMainTF(t *testing.T, block string, dir string) {
-	f, err := os.Create(fmt.Sprintf("%s/main.tf", dir))
-	if err != nil {
-		t.Fatal(err)
-	}
-	_, err = f.WriteString(block)
-	if err != nil {
-		t.Fatal(err)
-	}
-	f.Close()
-}
diff --git a/internal/cloud/e2e/helper_test.go b/internal/cloud/e2e/helper_test.go
index cad01a5c1a..5af66bf1c6 100644
--- a/internal/cloud/e2e/helper_test.go
+++ b/internal/cloud/e2e/helper_test.go
@@ -6,6 +6,7 @@ package main
 import (
 	"context"
 	"fmt"
+	"os"
 	"testing"
 	"time"
 
@@ -31,6 +32,11 @@ type operationSets struct {
 	prep     func(t *testing.T, orgName, dir string)
 }
 
+type testCases map[string]struct {
+	operations  []operationSets
+	validations func(t *testing.T, orgName string)
+}
+
 func createOrganization(t *testing.T) (*tfe.Organization, func()) {
 	ctx := context.Background()
 	org, err := tfeClient.Organizations.Create(ctx, tfe.OrganizationCreateOptions{
@@ -126,3 +132,15 @@ resource "random_pet" "server" {
 }
 `, tfeHostname, org, name)
 }
+
+func writeMainTF(t *testing.T, block string, dir string) {
+	f, err := os.Create(fmt.Sprintf("%s/main.tf", dir))
+	if err != nil {
+		t.Fatal(err)
+	}
+	_, err = f.WriteString(block)
+	if err != nil {
+		t.Fatal(err)
+	}
+	f.Close()
+}
diff --git a/internal/cloud/e2e/run_variables_test.go b/internal/cloud/e2e/run_variables_test.go
new file mode 100644
index 0000000000..ba20077a14
--- /dev/null
+++ b/internal/cloud/e2e/run_variables_test.go
@@ -0,0 +1,144 @@
+//go:build e2e
+// +build e2e
+
+package main
+
+import (
+	"fmt"
+	"io/ioutil"
+	"os"
+	"testing"
+
+	expect "github.com/Netflix/go-expect"
+	"github.com/hashicorp/terraform/internal/e2e"
+)
+
+func terraformConfigRequiredVariable(org, name string) string {
+	return fmt.Sprintf(`
+terraform {
+  cloud {
+    hostname = "%s"
+    organization = "%s"
+
+    workspaces {
+      name = "%s"
+    }
+  }
+}
+
+variable "foo" {
+  type = string
+}
+
+variable "baz" {
+	type = string
+}
+
+output "test_cli" {
+  value = var.foo
+}
+
+output "test_env" {
+  value = var.baz
+}
+
+`, tfeHostname, org, name)
+}
+
+func Test_cloud_run_variables(t *testing.T) {
+	cases := testCases{
+		"run variables from CLI arg": {
+			operations: []operationSets{
+				{
+					prep: func(t *testing.T, orgName, dir string) {
+						wsName := "new-workspace"
+						tfBlock := terraformConfigRequiredVariable(orgName, wsName)
+						writeMainTF(t, tfBlock, dir)
+					},
+					commands: []tfCommand{
+						{
+							command:        []string{"init"},
+							expectedOutput: `Successfully configured the backend "cloud"!`,
+						},
+						{
+							command:        []string{"plan", "-var", "foo=bar"},
+							expectedOutput: `  + test_cli = "bar"`,
+						},
+						{
+							command:        []string{"plan", "-var", "foo=bar"},
+							expectedOutput: `  + test_env = "qux"`,
+						},
+					},
+				},
+			},
+		},
+	}
+
+	for name, tc := range cases {
+		fmt.Println("Test: ", name)
+		organization, cleanup := createOrganization(t)
+		defer cleanup()
+		exp, err := expect.NewConsole(expect.WithStdout(os.Stdout), expect.WithDefaultTimeout(expectConsoleTimeout))
+		if err != nil {
+			t.Fatal(err)
+		}
+		defer exp.Close()
+
+		tmpDir, err := ioutil.TempDir("", "terraform-test")
+		if err != nil {
+			t.Fatal(err)
+		}
+		defer os.RemoveAll(tmpDir)
+
+		tf := e2e.NewBinary(terraformBin, tmpDir)
+		tf.AddEnv("TF_LOG=info")
+		tf.AddEnv("TF_CLI_ARGS=-no-color")
+		tf.AddEnv("TF_VAR_baz=qux")
+		tf.AddEnv(cliConfigFileEnv)
+		defer tf.Close()
+
+		for _, op := range tc.operations {
+			op.prep(t, organization.Name, tf.WorkDir())
+			for _, tfCmd := range op.commands {
+				cmd := tf.Cmd(tfCmd.command...)
+				cmd.Stdin = exp.Tty()
+				cmd.Stdout = exp.Tty()
+				cmd.Stderr = exp.Tty()
+
+				err = cmd.Start()
+				if err != nil {
+					t.Fatal(err)
+				}
+
+				if tfCmd.expectedOutput != "" {
+					_, err := exp.ExpectString(tfCmd.expectedOutput)
+					if err != nil {
+						t.Fatal(err)
+					}
+				}
+
+				if len(tfCmd.userInput) > 0 {
+					for _, input := range tfCmd.userInput {
+						exp.SendLine(input)
+					}
+				}
+
+				if tfCmd.postInputOutput != "" {
+					_, err := exp.ExpectString(tfCmd.postInputOutput)
+					if err != nil {
+						t.Fatal(err)
+					}
+				}
+
+				err = cmd.Wait()
+				if err != nil && !tfCmd.expectError {
+					t.Fatal(err)
+				}
+			}
+
+			if tc.validations != nil {
+				tc.validations(t, organization.Name)
+			}
+		}
+	}
+}