diff --git a/docsite/rst/intro_configuration.rst b/docsite/rst/intro_configuration.rst
index 2174da2accd..efcc4cf504b 100644
--- a/docsite/rst/intro_configuration.rst
+++ b/docsite/rst/intro_configuration.rst
@@ -5,17 +5,24 @@ The Ansible Configuration File
 
 .. highlight:: bash
 
-Certain things in Ansible are adjustable in a configuration file.  In general, the stock configuration is probably
-right for most users, but that doesn't mean you might not want to change them.
+Certain settings in Ansible are adjustable via a configuration file.  The stock configuration should be sufficient
+for most users, but there may be reasons you would want to change them.
 
-The mechanism for doing this is the "ansible.cfg" file, which is looked for in the following locations::
+Changes can be made and used in a configuration file which will be processed processed in the following order::
 
-    * /etc/ansible/ansible.cfg
-    * ~/.ansible.cfg
+    * ANSIBLE_CONFIG (an environment variable)
     * ansible.cfg (in the current directory)
+    * .ansible.cfg (in the home directory)
+    * /etc/ansible/ansible.cfg
 
-If multiple file locations matching the above exist, the last location on the above list is used.  Settings in files
-are not merged together.
+Prior to 1.5 the order was::
+
+    * ansible.cfg (in the current directory)
+    * ANSIBLE_CONFIG (an environment variable)
+    * .ansible.cfg (in the home directory)
+    * /etc/ansible/ansible.cfg
+
+Ansible will process the above list and use the first file found. Settings in file are not merged together.
 
 .. _getting_the_latest_configuration:
 
diff --git a/examples/ansible.cfg b/examples/ansible.cfg
index 930880df349..f543b2e4bc6 100644
--- a/examples/ansible.cfg
+++ b/examples/ansible.cfg
@@ -2,9 +2,10 @@
 # ==============================================
 
 # nearly all parameters can be overridden in ansible-playbook 
-# or with command line flags. ansible will read ~/.ansible.cfg, 
-# ansible.cfg in the current working directory or
-# /etc/ansible/ansible.cfg, whichever it finds first
+# or with command line flags. ansible will read ANSIBLE_CONFIG,
+# ansible.cfg in the current working directory, .ansible.cfg in
+# the home directory or /etc/ansible/ansible.cfg, whichever it
+# finds first
 
 [defaults]
 
diff --git a/lib/ansible/constants.py b/lib/ansible/constants.py
index c055ccf3d0c..c9daa247222 100644
--- a/lib/ansible/constants.py
+++ b/lib/ansible/constants.py
@@ -56,20 +56,22 @@ def _get_config(p, section, key, env_var, default):
     return default
 
 def load_config_file():
+    ''' Load Config File order(first found is used): ENV, CWD, HOME, /etc/ansible '''
+
     p = ConfigParser.ConfigParser()
+
+    path0 = os.getenv("ANSIBLE_CONFIG", None)
+    if path0 is not None:
+        path0 = os.path.expanduser(path0)
     path1 = os.getcwd() + "/ansible.cfg"
-    path2 = os.path.expanduser(os.environ.get('ANSIBLE_CONFIG', "~/.ansible.cfg"))
+    path2 = os.path.expanduser("~/.ansible.cfg")
     path3 = "/etc/ansible/ansible.cfg"
 
-    if os.path.exists(path1):
-        p.read(path1)
-    elif os.path.exists(path2):
-        p.read(path2)
-    elif os.path.exists(path3):
-        p.read(path3)
-    else:
-        return None
-    return p
+    for path in [path0, path1, path2, path3]:
+        if path is not None and os.path.exists(path):
+            p.read(path)
+            return p
+    return None
 
 def shell_expand_path(path):
     ''' shell_expand_path is needed as os.path.expanduser does not work