diff --git a/CHANGELOG.md b/CHANGELOG.md
index b155594..df7eff0 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -2,6 +2,7 @@
 
 ## v1.1.0
 - [Add layers attribute](https://github.com/babbel/terraform-aws-lambda-with-inline-code/pull/7)
+- [Add secret environment variables attribute](https://github.com/babbel/terraform-aws-lambda-with-inline-code/pull/8)
 
 
 ## v1.0.0
diff --git a/main.tf b/main.tf
index 85581d6..cb9a24c 100644
--- a/main.tf
+++ b/main.tf
@@ -13,7 +13,7 @@ resource "aws_lambda_function" "this" {
   role = aws_iam_role.this.arn
 
   dynamic "environment" {
-    for_each = var.environment_variables != null ? [{ variables = var.environment_variables }] : []
+    for_each = local.environment_variables != null ? [{ variables = local.environment_variables }] : []
 
     content {
       variables = environment.value.variables
@@ -25,7 +25,10 @@ resource "aws_lambda_function" "this" {
 
   tags = var.tags
 
-  depends_on = [aws_cloudwatch_log_group.this]
+  depends_on = [
+    aws_cloudwatch_log_group.this,
+    null_resource.watch_iam_role_policy_secretsmanager_get_secret_value,
+  ]
 }
 
 data "archive_file" "this" {
@@ -80,3 +83,58 @@ data "aws_iam_policy_document" "cloudwatch-log-group" {
     resources = ["${aws_cloudwatch_log_group.this.arn}:*"]
   }
 }
+
+
+# Secret environment variables
+
+locals {
+  environment_variables = merge(var.environment_variables, local.secret_environment_variables)
+
+  secret_environment_variables = {
+    for k, v in var.secret_environment_variables : join("", [k, "_SECRET_ARN"]) => v
+  }
+}
+
+resource "aws_iam_role_policy" "secretsmanager-get-secret-value" {
+  count = length(var.secret_environment_variables) > 0 ? 1 : 0
+
+  name   = "secretsmanager-get-secret-value-${md5(data.aws_iam_policy_document.secretsmanager-get-secret-value[count.index].json)}"
+  role   = aws_iam_role.this.name
+  policy = data.aws_iam_policy_document.secretsmanager-get-secret-value[count.index].json
+
+  lifecycle {
+    create_before_destroy = true
+  }
+}
+
+# Whenever a change is made to the secrets, the role policy must be updated
+# first, then we need to wait for a few seconds and only then update the lambda function itself.
+# Waiting is necessary because otherwise the during initialization of the lambda function
+# it will not yet have the permissions for fetching the secret values.
+resource "null_resource" "watch_iam_role_policy_secretsmanager_get_secret_value" {
+  count = length(var.secret_environment_variables) > 0 ? 1 : 0
+
+  # null_resource is replaced every time the policy changes
+  triggers = {
+    secretsmanager_get_secret_value_policy = aws_iam_role_policy.secretsmanager-get-secret-value[count.index].policy
+  }
+
+  provisioner "local-exec" {
+    command = "sleep 15"
+  }
+}
+
+data "aws_iam_policy_document" "secretsmanager-get-secret-value" {
+  count = length(var.secret_environment_variables) > 0 ? 1 : 0
+
+  statement {
+    actions = ["secretsmanager:GetSecretValue"]
+
+    # select secret arns and cut off trailing json keys
+    # https://docs.aws.amazon.com/AmazonECS/latest/developerguide/specifying-sensitive-data-secrets.html
+    resources = [
+      for k, extended_secret_arn in local.secret_environment_variables :
+      join(":", slice(split(":", extended_secret_arn), 0, 7)) if length(regexall("_SECRET_ARN$", k)) == 1
+    ]
+  }
+}
diff --git a/variables.tf b/variables.tf
index 05e48cf..6deb4a6 100644
--- a/variables.tf
+++ b/variables.tf
@@ -65,6 +65,19 @@ variable "runtime" {
   description = "The identifier of the Lambda function [runtime](https://docs.aws.amazon.com/lambda/latest/dg/lambda-runtimes.html)."
 }
 
+variable "secret_environment_variables" {
+  type    = map(string)
+  default = {}
+
+  description = <<EOS
+Map of environment variable names to ARNs of AWS Secret Manager secrets.
+
+Each ARN will be passed as environment variable to the lambda function with the key's name extended by suffix _SECRET_ARN. When initializing the Lambda run time environment, the Lambda function or a [wrapper script](https://docs.aws.amazon.com/lambda/latest/dg/runtimes-modify.html#runtime-wrapper) can look up the secret value.
+
+Permission will be added allowing the Lambda function to read the secret values.
+EOS
+}
+
 variable "source_dir" {
   type    = string
   default = null