diff --git a/docs/expand_template_doc.md b/docs/expand_template_doc.md
index d40649c6..e796da7e 100755
--- a/docs/expand_template_doc.md
+++ b/docs/expand_template_doc.md
@@ -27,7 +27,7 @@ explicitly add delimiters to the key strings, for example "{KEY}" or "@KEY@".
 | :------------- | :------------- | :------------- | :------------- | :------------- |
 | <a id="expand_template-name"></a>name |  A unique name for this target.   | <a href="https://bazel.build/concepts/labels#target-names">Name</a> | required |  |
 | <a id="expand_template-out"></a>out |  The destination of the expanded file.   | <a href="https://bazel.build/concepts/labels">Label</a>; <a href="https://bazel.build/reference/be/common-definitions#configurable-attributes">nonconfigurable</a> | required |  |
-| <a id="expand_template-substitutions"></a>substitutions |  A dictionary mapping strings to their substitutions.   | <a href="https://bazel.build/rules/lib/dict">Dictionary: String -> String</a> | required |  |
+| <a id="expand_template-substitutions"></a>substitutions |  A dictionary mapping strings to their substitutions. Values are subject to ["Make" variable expansion]. | <a href="https://bazel.build/rules/lib/dict">Dictionary: String -> String</a> | required |  |
 | <a id="expand_template-template"></a>template |  The template file to expand.   | <a href="https://bazel.build/concepts/labels">Label</a> | required |  |
 
-
+["Make" variable expansion]: https://bazel.build/reference/be/make-variables
diff --git a/rules/expand_template.bzl b/rules/expand_template.bzl
index f95507ec..a83294ae 100644
--- a/rules/expand_template.bzl
+++ b/rules/expand_template.bzl
@@ -16,10 +16,16 @@
 """
 
 def _expand_template_impl(ctx):
+    substitutions = {}
+    for key, value in ctx.attr.substitutions.items():
+        # TODO: Replace `expand_make_variables` once a suitable replacement exists.
+        # https://github.com/bazelbuild/bazel/issues/5859
+        substitutions[key] = ctx.expand_make_variables("substitutions", value, {})
+
     ctx.actions.expand_template(
         template = ctx.file.template,
         output = ctx.outputs.out,
-        substitutions = ctx.attr.substitutions,
+        substitutions = substitutions,
     )
 
 expand_template = rule(
diff --git a/tests/expand_template/BUILD b/tests/expand_template/BUILD
index 772e710b..4f973c25 100644
--- a/tests/expand_template/BUILD
+++ b/tests/expand_template/BUILD
@@ -62,3 +62,26 @@ cc_test(
         ":version",
     ],
 )
+
+expand_template(
+    name = "make_vars_expansion",
+    out = "make_vars.txt",
+    substitutions = {
+        "@bindir@": "$(BINDIR)",
+        "@gendir@": "$(GENDIR)",
+        "@target_cpu@": "$(TARGET_CPU)",
+    },
+    template = "make_vars.tpl.txt",
+)
+
+sh_test(
+    name = "make_vars_test",
+    srcs = ["make_vars_test.sh"],
+    data = [
+        ":make_vars_expansion",
+        "//tests:unittest.bash",
+    ],
+    deps = [
+        "@bazel_tools//tools/bash/runfiles",
+    ],
+)
diff --git a/tests/expand_template/make_vars.tpl.txt b/tests/expand_template/make_vars.tpl.txt
new file mode 100644
index 00000000..0b4942a5
--- /dev/null
+++ b/tests/expand_template/make_vars.tpl.txt
@@ -0,0 +1,3 @@
+BINDIR: @bindir@
+GENDIR: @gendir@
+TARGET_CPU: @target_cpu@
diff --git a/tests/expand_template/make_vars_test.sh b/tests/expand_template/make_vars_test.sh
new file mode 100755
index 00000000..8a26f741
--- /dev/null
+++ b/tests/expand_template/make_vars_test.sh
@@ -0,0 +1,48 @@
+#!/usr/bin/env bash
+
+# Copyright 2022 The Bazel Authors. All rights reserved.
+#
+# Licensed under the Apache License, Version 2.0 (the "License");
+# you may not use this file except in compliance with the License.
+# You may obtain a copy of the License at
+#
+#    http://www.apache.org/licenses/LICENSE-2.0
+#
+# Unless required by applicable law or agreed to in writing, software
+# distributed under the License is distributed on an "AS IS" BASIS,
+# WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+# See the License for the specific language governing permissions and
+# limitations under the License.
+
+# --- begin runfiles.bash initialization v2 ---
+# Copy-pasted from the Bazel Bash runfiles library v2.
+set -uo pipefail; f=bazel_tools/tools/bash/runfiles/runfiles.bash
+source "${RUNFILES_DIR:-/dev/null}/$f" 2>/dev/null || \
+    source "$(grep -sm1 "^$f " "${RUNFILES_MANIFEST_FILE:-/dev/null}" | cut -f2- -d' ')" 2>/dev/null || \
+    source "$0.runfiles/$f" 2>/dev/null || \
+    source "$(grep -sm1 "^$f " "$0.runfiles_manifest" | cut -f2- -d' ')" 2>/dev/null || \
+    source "$(grep -sm1 "^$f " "$0.exe.runfiles_manifest" | cut -f2- -d' ')" 2>/dev/null || \
+    { echo>&2 "ERROR: cannot find $f"; exit 1; }; f=; set -e
+# --- end runfiles.bash initialization v2 ---
+
+source "$(rlocation $TEST_WORKSPACE/tests/unittest.bash)" \
+  || { echo "Could not source bazel_skylib/tests/unittest.bash" >&2; exit 1; }
+
+function test_make_vars_expansion() {
+  cat "$(rlocation $TEST_WORKSPACE/tests/expand_template/make_vars.txt)" >"$TEST_log"
+
+  # Verify that make variables were expanded (not literal strings)
+  # The expanded values should contain actual paths, not the literal "$(BINDIR)" etc.
+  if grep -q '\$(' "$TEST_log"; then
+    echo "ERROR: Make variables were not expanded" >&2
+    cat "$TEST_log" >&2
+    fail "Make variables should be expanded, but found literal \$(...) in output"
+  fi
+
+  # Verify that each line contains the expected prefix and some non-empty value.
+  expect_log '^BINDIR: ..*'
+  expect_log '^GENDIR: ..*'
+  expect_log '^TARGET_CPU: ..*'
+}
+
+run_suite "make_vars_expansion test suite"