diff --git a/__tests__/config/utils/env.test.ts b/__tests__/config/utils/env.test.ts
new file mode 100644
index 00000000..f0366dd1
--- /dev/null
+++ b/__tests__/config/utils/env.test.ts
@@ -0,0 +1,27 @@
+import { filterEnvVariablesForDeploy } from '../../../src/config/utils/env';
+import { EnvironmentVariablesWithAuth } from '../../../src/types/generic';
+
+describe('filterEnvVariablesForDeploy', () => {
+  const testVars: EnvironmentVariablesWithAuth = {
+    ACCOUNT_SID: 'ACCOUNT_SID',
+    AUTH_TOKEN: 'AUTH_TOKEN',
+    empty: '',
+    hello: 'world',
+  };
+
+  it('deletes ACCOUNT_SID and AUTH_TOKEN', () => {
+    const deployVars = filterEnvVariablesForDeploy(testVars);
+    expect(deployVars['ACCOUNT_SID']).toBeUndefined();
+    expect(deployVars['AUTH_TOKEN']).toBeUndefined();
+  });
+
+  it('deletes empty env vars', () => {
+    const deployVars = filterEnvVariablesForDeploy(testVars);
+    expect(deployVars['empty']).toBeUndefined();
+  });
+
+  it('leaves other variables as they were', () => {
+    const deployVars = filterEnvVariablesForDeploy(testVars);
+    expect(deployVars['hello']).toEqual('world');
+  });
+});
diff --git a/package.json b/package.json
index 1550160c..f4e694a8 100644
--- a/package.json
+++ b/package.json
@@ -38,7 +38,7 @@
   "author": "Dominik Kundel <dkundel@twilio.com>",
   "license": "MIT",
   "dependencies": {
-    "@twilio-labs/serverless-api": "^3.0.0",
+    "@twilio-labs/serverless-api": "^3.1.0",
     "@twilio-labs/serverless-runtime-types": "^1.1.7",
     "@types/express": "^4.17.0",
     "@types/inquirer": "^6.0.3",
diff --git a/src/config/activate.ts b/src/config/activate.ts
index 643be10d..ee36c356 100644
--- a/src/config/activate.ts
+++ b/src/config/activate.ts
@@ -9,7 +9,7 @@ import {
 } from '../commands/shared';
 import { getFullCommand } from '../commands/utils';
 import { readSpecializedConfig } from './global';
-import { getCredentialsFromFlags } from './utils';
+import { getCredentialsFromFlags, readLocalEnvFile, filterEnvVariablesForDeploy } from './utils';
 import { mergeFlagsAndConfig } from './utils/mergeFlagsAndConfig';
 
 type ActivateConfig = ApiActivateConfig & {
@@ -61,6 +61,8 @@ export async function getConfigFromFlags(
     flags,
     externalCliOptions
   );
+  const { localEnv } = await readLocalEnvFile(flags);
+  const env = filterEnvVariablesForDeploy(localEnv);
 
   const command = getFullCommand(flags);
   const serviceSid = checkForValidServiceSid(command, flags.serviceSid);
@@ -79,5 +81,6 @@ export async function getConfigFromFlags(
     sourceEnvironment: flags.sourceEnvironment,
     region,
     edge,
+    env
   };
 }
diff --git a/src/config/deploy.ts b/src/config/deploy.ts
index 58843e48..65631bc3 100644
--- a/src/config/deploy.ts
+++ b/src/config/deploy.ts
@@ -14,6 +14,7 @@ import {
   getServiceNameFromFlags,
   readLocalEnvFile,
   readPackageJsonContent,
+  filterEnvVariablesForDeploy
 } from './utils';
 import { mergeFlagsAndConfig } from './utils/mergeFlagsAndConfig';
 
@@ -69,6 +70,7 @@ export async function getConfigFromFlags(
     externalCliOptions
   );
   const { localEnv, envPath } = await readLocalEnvFile(flags);
+  const env = filterEnvVariablesForDeploy(localEnv);
 
   const serviceSid =
     flags.serviceSid ||
@@ -83,20 +85,6 @@ export async function getConfigFromFlags(
 
   const pkgJson = await readPackageJsonContent(flags);
 
-  const env = {
-    ...localEnv,
-  };
-
-  for (let key of Object.keys(env)) {
-    const val = env[key];
-    if (typeof val === 'string' && val.length === 0) {
-      delete env[key];
-    }
-  }
-
-  delete env.ACCOUNT_SID;
-  delete env.AUTH_TOKEN;
-
   let serviceName: string | undefined = await getServiceNameFromFlags(flags);
 
   if (!serviceName) {
diff --git a/src/config/utils/env.ts b/src/config/utils/env.ts
index 5f3655cc..46a75aba 100644
--- a/src/config/utils/env.ts
+++ b/src/config/utils/env.ts
@@ -1,6 +1,7 @@
 import dotenv from 'dotenv';
 import path from 'path';
 import { EnvironmentVariablesWithAuth } from '../../types/generic';
+import { EnvironmentVariables } from '@twilio-labs/serverless-api';
 import { fileExists, readFile } from '../../utils/fs';
 
 export async function readLocalEnvFile(flags: {
@@ -25,3 +26,21 @@ export async function readLocalEnvFile(flags: {
   }
   return { envPath: '', localEnv: {} };
 }
+
+export function filterEnvVariablesForDeploy(localEnv: EnvironmentVariablesWithAuth): EnvironmentVariables {
+  const env = {
+    ...localEnv,
+  };
+
+  for (let key of Object.keys(env)) {
+    const val = env[key];
+    if (typeof val === 'string' && val.length === 0) {
+      delete env[key];
+    }
+  }
+
+  delete env.ACCOUNT_SID;
+  delete env.AUTH_TOKEN;
+
+  return env;
+}
\ No newline at end of file