diff --git a/Cargo.toml b/Cargo.toml
index b7dc747b80a..8bb0711cf25 100644
--- a/Cargo.toml
+++ b/Cargo.toml
@@ -28,6 +28,7 @@ crypto-hash = "0.3.1"
 curl = { version = "0.4.23", features = ["http2"] }
 curl-sys = "0.4.22"
 env_logger = "0.8.1"
+directories = "1.0"
 pretty_env_logger = { version = "0.4", optional = true }
 anyhow = "1.0"
 filetime = "0.2.9"
diff --git a/src/cargo/util/config/dirs.rs b/src/cargo/util/config/dirs.rs
new file mode 100644
index 00000000000..6ee4c7badac
--- /dev/null
+++ b/src/cargo/util/config/dirs.rs
@@ -0,0 +1,137 @@
+//! An abstraction over what directories cargo should use for state
+
+use crate::util::{
+    config::Filesystem,
+    errors::{CargoResult, CargoResultExt},
+};
+use directories::ProjectDirs;
+use log::debug;
+use std::env;
+use std::path::PathBuf;
+
+#[derive(Clone, Debug)]
+pub struct CargoDirs {
+    /// The dir cargo was run in
+    pub current_dir: PathBuf,
+    /// Main directory for cargo data
+    pub data_dir: Filesystem,
+    /// Immutable global cargo configuration
+    pub config_dir: Filesystem,
+    /// Caching registry artefacts (previously .cargo/registry/cache)
+    pub cache_dir: Filesystem,
+    /// Directory where binaries are kept
+    pub bin_dir: Filesystem,
+    /// Kept to walk upwards the directory tree to find a Cargo.toml
+    pub home_dir: Filesystem,
+}
+
+impl CargoDirs {
+    /// Constructs the hierarchy of directories that cargo will use
+    pub fn new(home_dir: PathBuf) -> CargoResult<CargoDirs> {
+        let current_dir =
+            env::current_dir().chain_err(|| "couldn't get the current directory of the process")?;
+
+        let mut cache_dir = PathBuf::default();
+        let mut config_dir = PathBuf::default();
+        let mut data_dir = PathBuf::default();
+        let mut bin_dir = PathBuf::default();
+
+        // 1. CARGO_HOME set
+        let cargo_home_env = env::var_os("CARGO_HOME").map(|home| current_dir.join(home));
+        if let Some(cargo_home) = cargo_home_env.clone() {
+            cache_dir = cargo_home.clone();
+            config_dir = cargo_home.clone();
+            data_dir = cargo_home.clone();
+            bin_dir = cargo_home.join("bin");
+        }
+
+        // 2. CARGO_CACHE_DIR, CARGO_CONFIG_DIR, CARGO_BIN_DIR, ... set
+        let cargo_cache_env = env::var_os("CARGO_CACHE_DIR").map(|home| current_dir.join(home));
+        let cargo_config_env = env::var_os("CARGO_CONFIG_DIR").map(|home| current_dir.join(home));
+        let cargo_data_env = env::var_os("CARGO_DATA_DIR").map(|home| current_dir.join(home));
+        let cargo_bin_env = env::var_os("CARGO_BIN_DIR").map(|home| current_dir.join(home));
+        if let Some(cargo_cache) = cargo_cache_env.clone() {
+            cache_dir = cargo_cache.clone();
+        }
+        if let Some(cargo_config) = cargo_config_env.clone() {
+            config_dir = cargo_config.clone();
+        }
+        if let Some(cargo_data) = cargo_data_env.clone() {
+            data_dir = cargo_data.clone();
+        }
+        if let Some(cargo_bin) = cargo_bin_env.clone() {
+            bin_dir = cargo_bin.clone();
+        }
+
+        // no env vars are set ...
+        if cargo_home_env.is_none()
+            && cargo_cache_env.is_none()
+            && cargo_config_env.is_none()
+            && cargo_data_env.is_none()
+            && cargo_bin_env.is_none()
+        {
+            let legacy_cargo_dir = home_dir.join(".cargo");
+
+            // 3. ... and .cargo exist
+            if legacy_cargo_dir.exists() {
+                debug!("Using legacy paths at $HOME, consider moving to $XDG_DATA_HOME");
+                cache_dir = legacy_cargo_dir.clone();
+                config_dir = legacy_cargo_dir.clone();
+                data_dir = legacy_cargo_dir.clone();
+                bin_dir = legacy_cargo_dir.join("bin");
+
+            // 4. ... otherwise follow platform conventions
+            } else {
+                let xdg_dirs = match ProjectDirs::from("org", "rust-lang", "cargo") {
+                    Some(d) => Ok(d),
+                    None => Err(anyhow::format_err!(
+                        "failed to get directories according to XDG settings"
+                    )),
+                }?;
+
+                cache_dir = xdg_dirs.cache_dir().to_path_buf();
+                config_dir = xdg_dirs.config_dir().to_path_buf();
+                data_dir = xdg_dirs.data_dir().to_path_buf();
+                bin_dir = CargoDirs::find_bin_dir(&xdg_dirs)
+                    .ok_or_else(|| {
+                        anyhow::format_err!(
+                            "couldn't find the directory in which executables are placed"
+                        )
+                    })?
+                    .to_path_buf();
+            }
+        }
+
+        Ok(CargoDirs {
+            current_dir,
+            cache_dir: Filesystem::new(cache_dir),
+            config_dir: Filesystem::new(config_dir),
+            data_dir: Filesystem::new(data_dir),
+            bin_dir: Filesystem::new(bin_dir),
+            home_dir: Filesystem::new(home_dir),
+        })
+    }
+
+    #[cfg(target_os = "linux")]
+    fn find_bin_dir(_dirs: &ProjectDirs) -> Option<PathBuf> {
+        use directories::BaseDirs;
+        let base_dir = BaseDirs::new()?;
+        base_dir.executable_dir().map(|p| p.to_path_buf())
+    }
+
+    #[cfg(target_os = "macos")]
+    fn find_bin_dir(dirs: &ProjectDirs) -> Option<PathBuf> {
+        dirs.data_dir()
+            .parent()
+            .map(|p| p.join("bin"))
+            .map(|p| p.to_path_buf())
+    }
+
+    #[cfg(target_os = "windows")]
+    fn find_bin_dir(dirs: &ProjectDirs) -> Option<PathBuf> {
+        dirs.data_dir()
+            .parent()
+            .map(|p| p.join("bin"))
+            .map(|p| p.to_path_buf())
+    }
+}
diff --git a/src/cargo/util/config/mod.rs b/src/cargo/util/config/mod.rs
index 7cea1bcecc3..2ee1c03554e 100644
--- a/src/cargo/util/config/mod.rs
+++ b/src/cargo/util/config/mod.rs
@@ -82,6 +82,9 @@ use crate::util::{FileLock, Filesystem, IntoUrl, IntoUrlWithBase, Rustc};
 mod de;
 use de::Deserializer;
 
+mod dirs;
+use dirs::CargoDirs;
+
 mod value;
 pub use value::{Definition, OptValue, Value};
 
@@ -122,8 +125,8 @@ macro_rules! get_value_typed {
 /// relating to cargo itself.
 #[derive(Debug)]
 pub struct Config {
-    /// The location of the user's Cargo home directory. OS-dependent.
-    home_path: Filesystem,
+    /// The location of the user's 'home' directory. OS-dependent.
+    dirs: CargoDirs,
     /// Information about how to write messages to the shell
     shell: RefCell<Shell>,
     /// A collection of configuration options
@@ -191,7 +194,7 @@ impl Config {
     ///
     /// This does only minimal initialization. In particular, it does not load
     /// any config files from disk. Those will be loaded lazily as-needed.
-    pub fn new(shell: Shell, cwd: PathBuf, homedir: PathBuf) -> Config {
+    pub fn new(shell: Shell, cwd: PathBuf, homedir: PathBuf) -> CargoResult<Config> {
         static mut GLOBAL_JOBSERVER: *mut jobserver::Client = 0 as *mut _;
         static INIT: Once = Once::new();
 
@@ -227,8 +230,8 @@ impl Config {
             _ => true,
         };
 
-        Config {
-            home_path: Filesystem::new(homedir),
+        Ok(Config {
+            dirs: CargoDirs::new(homedir)?,
             shell: RefCell::new(shell),
             cwd,
             search_stop_path: None,
@@ -264,7 +267,7 @@ impl Config {
             target_cfgs: LazyCell::new(),
             doc_extern_map: LazyCell::new(),
             progress_config: ProgressConfig::default(),
-        }
+        })
     }
 
     /// Creates a new Config instance, with all default settings.
@@ -281,32 +284,32 @@ impl Config {
                  This probably means that $HOME was not set."
             )
         })?;
-        Ok(Config::new(shell, cwd, homedir))
+        Config::new(shell, cwd, homedir)
     }
 
     /// Gets the user's Cargo home directory (OS-dependent).
     pub fn home(&self) -> &Filesystem {
-        &self.home_path
+        &self.dirs.data_dir
     }
 
     /// Gets the Cargo Git directory (`<cargo_home>/git`).
     pub fn git_path(&self) -> Filesystem {
-        self.home_path.join("git")
+        self.dirs.data_dir.join("git")
     }
 
     /// Gets the Cargo registry index directory (`<cargo_home>/registry/index`).
     pub fn registry_index_path(&self) -> Filesystem {
-        self.home_path.join("registry").join("index")
+        self.dirs.data_dir.join("registry").join("index")
     }
 
     /// Gets the Cargo registry cache directory (`<cargo_home>/registry/path`).
     pub fn registry_cache_path(&self) -> Filesystem {
-        self.home_path.join("registry").join("cache")
+        self.dirs.cache_dir.clone()
     }
 
     /// Gets the Cargo registry source directory (`<cargo_home>/registry/src`).
     pub fn registry_source_path(&self) -> Filesystem {
-        self.home_path.join("registry").join("src")
+        self.dirs.data_dir.join("registry").join("src")
     }
 
     /// Gets the default Cargo registry.
@@ -870,7 +873,7 @@ impl Config {
         // This definition path is ignored, this is just a temporary container
         // representing the entire file.
         let mut cfg = CV::Table(HashMap::new(), Definition::Path(PathBuf::from(".")));
-        let home = self.home_path.clone().into_path_unlocked();
+        let home = self.dirs.home_dir.clone().into_path_unlocked();
 
         self.walk_tree(path, &home, |path| {
             let value = self.load_file(path)?;
@@ -1137,7 +1140,7 @@ impl Config {
 
     /// Loads credentials config from the credentials file, if present.
     pub fn load_credentials(&mut self) -> CargoResult<()> {
-        let home_path = self.home_path.clone().into_path_unlocked();
+        let home_path = self.dirs.data_dir.clone().into_path_unlocked();
         let credentials = match self.get_file_path(&home_path, "credentials", true)? {
             Some(credentials) => credentials,
             None => return Ok(()),
@@ -1316,7 +1319,7 @@ impl Config {
             "package cache lock is not currently held, Cargo forgot to call \
              `acquire_package_cache_lock` before we got to this stack frame",
         );
-        assert!(ret.starts_with(self.home_path.as_path_unlocked()));
+        assert!(ret.starts_with(self.dirs.cache_dir.as_path_unlocked()));
         ret
     }
 
@@ -1353,11 +1356,11 @@ impl Config {
                 // someone else on the system we should synchronize with them,
                 // but if we can't even do that then we did our best and we just
                 // keep on chugging elsewhere.
-                match self.home_path.open_rw(path, self, desc) {
+                match self.dirs.data_dir.open_rw(path, self, desc) {
                     Ok(lock) => *slot = Some((Some(lock), 1)),
                     Err(e) => {
                         if maybe_readonly(&e) {
-                            let lock = self.home_path.open_ro(path, self, desc).ok();
+                            let lock = self.dirs.data_dir.open_ro(path, self, desc).ok();
                             *slot = Some((lock, 1));
                             return Ok(PackageCacheLock(self));
                         }
@@ -1677,7 +1680,7 @@ pub fn save_credentials(
     // If 'credentials.toml' exists, we should write to that, otherwise
     // use the legacy 'credentials'. There's no need to print the warning
     // here, because it would already be printed at load time.
-    let home_path = cfg.home_path.clone().into_path_unlocked();
+    let home_path = cfg.dirs.data_dir.clone().into_path_unlocked();
     let filename = match cfg.get_file_path(&home_path, "credentials", false)? {
         Some(path) => match path.file_name() {
             Some(filename) => Path::new(filename).to_owned(),
@@ -1687,8 +1690,9 @@ pub fn save_credentials(
     };
 
     let mut file = {
-        cfg.home_path.create_dir()?;
-        cfg.home_path
+        cfg.dirs.data_dir.create_dir()?;
+        cfg.dirs
+            .data_dir
             .open_rw(filename, cfg, "credentials' config file")?
     };
 
diff --git a/tests/testsuite/build.rs b/tests/testsuite/build.rs
index 7a9a82612d2..87432929a8c 100644
--- a/tests/testsuite/build.rs
+++ b/tests/testsuite/build.rs
@@ -431,7 +431,7 @@ fn cargo_compile_api_exposes_artifact_paths() {
         .build();
 
     let shell = Shell::from_write(Box::new(Vec::new()));
-    let config = Config::new(shell, env::current_dir().unwrap(), paths::home());
+    let config = Config::new(shell, env::current_dir().unwrap(), paths::home()).unwrap();
     let ws = Workspace::new(&p.root().join("Cargo.toml"), &config).unwrap();
     let compile_options = CompileOptions::new(ws.config(), CompileMode::Build).unwrap();
 
diff --git a/tests/testsuite/config.rs b/tests/testsuite/config.rs
index 1b45b65b307..1608783c630 100644
--- a/tests/testsuite/config.rs
+++ b/tests/testsuite/config.rs
@@ -75,7 +75,7 @@ impl ConfigBuilder {
         let shell = Shell::from_write(output);
         let cwd = self.cwd.clone().unwrap_or_else(|| paths::root());
         let homedir = paths::home();
-        let mut config = Config::new(shell, cwd, homedir);
+        let mut config = Config::new(shell, cwd, homedir)?;
         config.set_env(self.env.clone());
         config.set_search_stop_path(paths::root());
         config.configure(
diff --git a/tests/testsuite/login.rs b/tests/testsuite/login.rs
index 835461af8de..64abc4a33bd 100644
--- a/tests/testsuite/login.rs
+++ b/tests/testsuite/login.rs
@@ -135,7 +135,7 @@ fn new_credentials_is_used_instead_old() {
         .arg(TOKEN)
         .run();
 
-    let mut config = Config::new(Shell::new(), cargo_home(), cargo_home());
+    let mut config = Config::new(Shell::new(), cargo_home(), cargo_home()).unwrap();
     let _ = config.values();
     let _ = config.load_credentials();
 
diff --git a/tests/testsuite/member_discovery.rs b/tests/testsuite/member_discovery.rs
index e882add3e1c..d80f32f6289 100644
--- a/tests/testsuite/member_discovery.rs
+++ b/tests/testsuite/member_discovery.rs
@@ -37,7 +37,8 @@ fn bad_file_member_exclusion() {
         Shell::from_write(Box::new(Vec::new())),
         cargo_home(),
         cargo_home(),
-    );
+    )
+    .unwrap();
     let ws = Workspace::new(&p.root().join("Cargo.toml"), &config).unwrap();
     assert_eq!(ws.members().count(), 1);
     assert_eq!(ws.members().next().unwrap().name(), "bar");
diff --git a/tests/testsuite/member_errors.rs b/tests/testsuite/member_errors.rs
index 10533b292c6..2954d4263bb 100644
--- a/tests/testsuite/member_errors.rs
+++ b/tests/testsuite/member_errors.rs
@@ -149,7 +149,8 @@ fn member_manifest_version_error() {
         Shell::from_write(Box::new(Vec::new())),
         cargo_home(),
         cargo_home(),
-    );
+    )
+    .unwrap();
     let ws = Workspace::new(&p.root().join("Cargo.toml"), &config).unwrap();
     let compile_options = CompileOptions::new(&config, CompileMode::Build).unwrap();
     let member_bar = ws.members().find(|m| &*m.name() == "bar").unwrap();
diff --git a/tests/testsuite/search.rs b/tests/testsuite/search.rs
index 0d239b3b455..390135f39ef 100644
--- a/tests/testsuite/search.rs
+++ b/tests/testsuite/search.rs
@@ -148,7 +148,8 @@ fn not_update() {
         Shell::from_write(Box::new(Vec::new())),
         paths::root(),
         paths::home().join(".cargo"),
-    );
+    )
+    .unwrap();
     let lock = cfg.acquire_package_cache_lock().unwrap();
     let mut regsrc = RegistrySource::remote(sid, &HashSet::new(), &cfg);
     regsrc.update().unwrap();