diff --git a/.gitignore b/.gitignore
index 249499b135..0acfdf80c7 100644
--- a/.gitignore
+++ b/.gitignore
@@ -1,11 +1,8 @@
 .venv
-.coverage
-.coverage.*
 _build
 .DS_Store
 .vscode
 docs/_static/pypi.svg
-.tox
 __pycache__
 
 # Packaging artifacts
@@ -21,6 +18,13 @@ src/_black_version.py
 
 .dmypy.json
 *.swp
-.hypothesis/
 venv/
 .ipynb_checkpoints/
+
+# Unit test / coverage reports
+htmlcov/
+.tox/
+.coverage
+.coverage.*
+.hypothesis/
+.pytest_cache/
diff --git a/CHANGES.md b/CHANGES.md
index b2e8f7439b..e78afb9ca2 100644
--- a/CHANGES.md
+++ b/CHANGES.md
@@ -9,6 +9,7 @@
 - Add partial support for the match statement. As it's experimental, it's only enabled
   when `--target-version py310` is explicitly specified (#2586)
 - Add support for parenthesized with (#2586)
+- Allow specifying `config` in config files (#2525)
 
 ## 21.10b0
 
@@ -16,6 +17,7 @@
 
 - Document stability policy, that will apply for non-beta releases (#2529)
 - Add new `--workers` parameter (#2514)
+- Bumped typed-ast version minimum to 1.4.3 for 3.10 compatibility (#2519)
 - Fixed feature detection for positional-only arguments in lambdas (#2532)
 - Bumped typed-ast version minimum to 1.4.3 for 3.10 compatibility (#2519)
 - Fixed a Python 3.10 compatibility issue where the loop argument was still being passed
diff --git a/src/black/__init__.py b/src/black/__init__.py
index ad4ee1a0d1..997cb6ed5f 100644
--- a/src/black/__init__.py
+++ b/src/black/__init__.py
@@ -120,28 +120,30 @@ def read_pyproject_toml(
 
     if not config:
         return None
-    else:
-        # Sanitize the values to be Click friendly. For more information please see:
-        # https://github.com/psf/black/issues/1458
-        # https://github.com/pallets/click/issues/1567
-        config = {
-            k: str(v) if not isinstance(v, (list, dict)) else v
-            for k, v in config.items()
-        }
-
-    target_version = config.get("target_version")
+
+    if ctx.default_map:
+        config.update(ctx.default_map)
+
+    black_config = config.get("config")
+    if black_config:
+        black_config_path = Path(Path(value).parent, black_config).resolve()
+        return read_pyproject_toml(ctx, param, str(black_config_path))
+
+    # Sanitize the values to be Click friendly. For more information please see:
+    # https://github.com/psf/black/issues/1458
+    # https://github.com/pallets/click/issues/1567
+    default_map: Dict[str, Any] = {
+        k: str(v) if not isinstance(v, (list, dict)) else v for k, v in config.items()
+    }
+
+    target_version = default_map.get("target_version")
     if target_version is not None and not isinstance(target_version, list):
         raise click.BadOptionUsage(
             "target-version", "Config key target-version must be a list"
         )
 
-    default_map: Dict[str, Any] = {}
-    if ctx.default_map:
-        default_map.update(ctx.default_map)
-    default_map.update(config)
-
     ctx.default_map = default_map
-    return value
+    return str(value)
 
 
 def target_version_option_callback(
diff --git a/tests/_black_config.toml b/tests/_black_config.toml
new file mode 100644
index 0000000000..175fb41770
--- /dev/null
+++ b/tests/_black_config.toml
@@ -0,0 +1,9 @@
+[tool.black]
+verbose = 1
+--check = "no"
+diff = "y"
+color = true
+line-length = 88
+target-version = ["py36", "py37", "py38"]
+exclude='\.pyi?$'
+include='\.py?$'
diff --git a/tests/invalid_test.toml b/tests/invalid_test.toml
new file mode 100644
index 0000000000..8c92ada4f6
--- /dev/null
+++ b/tests/invalid_test.toml
@@ -0,0 +1,2 @@
+[tool.black]
+config = "tests/bazqux.toml"
diff --git a/tests/test_black.py b/tests/test_black.py
index 7dbc3809d2..01175e868f 100644
--- a/tests/test_black.py
+++ b/tests/test_black.py
@@ -1296,6 +1296,28 @@ def test_read_pyproject_toml(self) -> None:
         self.assertEqual(config["exclude"], r"\.pyi?$")
         self.assertEqual(config["include"], r"\.py?$")
 
+    def test_black_replace_config(self) -> None:
+        test_toml_file = THIS_DIR / "test_replace.toml"
+        fake_ctx = FakeContext()
+        black.read_pyproject_toml(fake_ctx, FakeParameter(), str(test_toml_file))
+        config = fake_ctx.default_map
+        # `0` in `test_replace.toml` and `1` in `_black_config.toml`. Should be `1` as
+        # the one linked should overwrite the config
+        self.assertEqual(config["verbose"], "1")
+        self.assertEqual(config["check"], "no")
+        self.assertEqual(config["diff"], "y")
+        self.assertEqual(config["color"], "True")
+        self.assertEqual(config["line_length"], "88")
+        self.assertEqual(config["target_version"], ["py36", "py37", "py38"])
+        self.assertEqual(config["exclude"], r"\.pyi?$")
+        self.assertEqual(config["include"], r"\.py?$")
+
+    def test_invalid_black_config(self) -> None:
+        test_toml_file = THIS_DIR / "invalid_test.toml"
+        fake_ctx = FakeContext()
+        with self.assertRaises(click.exceptions.FileError):
+            black.read_pyproject_toml(fake_ctx, FakeParameter(), str(test_toml_file))
+
     def test_find_project_root(self) -> None:
         with TemporaryDirectory() as workspace:
             root = Path(workspace)
diff --git a/tests/test_replace.toml b/tests/test_replace.toml
new file mode 100644
index 0000000000..0541876a9d
--- /dev/null
+++ b/tests/test_replace.toml
@@ -0,0 +1,4 @@
+[tool.black]
+config = "_black_config.toml"
+verbose = 0
+color = false