diff --git a/doc/source/dev/devsetup.rst b/doc/source/dev/devsetup.rst
index 6c8eef4b..67398a7f 100644
--- a/doc/source/dev/devsetup.rst
+++ b/doc/source/dev/devsetup.rst
@@ -68,16 +68,23 @@ Running tests
 -------------
 
 The FuseSoC contains unit tests written using the pytest framework.
+To run the tests in an isolated environment it is recommended to run pytest through tox, which first creates a package of the source code, installs it, and then runs the tests.
+This ensures that packaging and environment errors are less likely to slip through.
 
 .. code-block:: bash
 
    cd fusesoc/source/directory
 
-   # run all tests
-   python3 -m pytest
+   # Run all tests in an isolated environment (recommended)
+   tox
+
+   # All arguments passed to tox after -- are passed to pytest directly.
+   # E.g. run a single test: use filename::method_name, e.g.
+   tox -- tests/test_capi2.py::test_capi2_get_tool --verbose
 
-   # run a single test: use filename::method_name, e.g.
-   python3 -m pytest tests/test_capi2.py::test_capi2_get_tool --verbose
+   # Alternatively, tests can be run directly from the source tree.
+   # E.g. to run a single test: use filename::method_name, e.g.
+   python3 -m pytest
 
 Refer to the `pytest documentation <https://docs.pytest.org/en/latest/>`_ for more information how tests can be run.
 
diff --git a/tox.ini b/tox.ini
new file mode 100644
index 00000000..b14ff695
--- /dev/null
+++ b/tox.ini
@@ -0,0 +1,25 @@
+[tox]
+envlist = py3
+
+[testenv]
+# Some tests need an initialized FuseSoC library to be present. To make tests
+# reproducible tox doesn't use the library installed into the user's home
+# directory, but creates an isolated home directory within the tox working
+# directory, and clears it out after each test.
+deps = pytest
+commands =
+    /bin/rm -rf {toxworkdir}/.tmp/homedir
+    fusesoc init -y
+    fusesoc list-cores
+    fusesoc library update
+    pytest {posargs}
+
+setenv =
+    MODEL_TECH = dummy_value
+    HOME = {toxworkdir}/.tmp/homedir
+    XDG_CACHE_HOME = {toxworkdir}/.tmp/homedir/.cache
+    XDG_DATA_HOME= {toxworkdir}/.tmp/homedir/.local/share
+    XDG_CONFIG_HOME = {toxworkdir}/.tmp/homedir/.config
+
+whitelist_externals =
+  /bin/rm