Short answer: you can’t. In Prefect 3.x,

prefect.toml

does not support environment variable placeholders or interpolation. Here are the supported ways to use environment-specific values: - Use environment variables directly (they take precedence over

prefect.toml

):

# shell
  export PREFECT_API_URL="<https://my-api.example.com/api>"
  export PREFECT_LOGGING_LEVEL="DEBUG"

Then keep plain values (or defaults) in `prefect.toml`:

[logging]
  level = "INFO"  # overridden by PREFECT_LOGGING_LEVEL if set

- For deployments, use environment variables in

prefect.yaml

with templating:

deployments:
    - name: my-deployment
      tags:
        - "{{ $MY_DEPLOYMENT_TAG }}"   # reads the MY_DEPLOYMENT_TAG env var
      work_pool:
        name: "my-pool"

The

{{ $ENV_VAR_NAME }}

syntax is supported in

prefect.yaml

only (not in

prefect.toml

). - If you need different settings per environment, consider multiple profiles (no placeholders in

profiles.toml

either) and switch with

prefect profile use <name>

. If you can share which setting you’re trying to parameterize in

prefect.toml

, I can suggest the cleanest pattern for your setup.