diff --git a/CONFIG.md b/CONFIG.md
new file mode 100644
index 00000000..1ceb0e3c
--- /dev/null
+++ b/CONFIG.md
@@ -0,0 +1,42 @@
+# qloader2 configuration file
+
+The qloader2 configuration file is comprised of *assignments* and *entries*.
+
+*Entries* describe boot *entries* which the user can select in the *boot menu*.
+
+An *entry* is simply a line starting with `:` followed by a newline-terminated
+string.
+Any *locally assignable* key that comes after it, and before another *entry*, or
+the end of the file, will be tied to the *entry*.
+
+*Assignments* are simple `KEY=VALUE` style assignments.
+`VALUE` can have spaces and `=` symbols, without requiring quotations. New lines
+are delimiters.
+
+Some *assignments* are part of an entry (*local*), some other assignments are *global*.
+*Global assignments* can appear anywhere in the file and are not part of an entry,
+although usually one would put them at the beginning of the config.
+Some *local assignments* are shared between entries using any *protocol*, while other
+*local assignments* are specific to a given *protocol*.
+
+*Globally assignable* keys are:
+* `TIMEOUT` - Specifies the timeout in seconds before the first *entry* is automatically booted.
+
+*Locally assignable (non protocol specific)* keys are:
+* `KERNEL_DRIVE` - The BIOS drive (in decimal) where the kernel resides (if unspecified, boot drive is assumed).
+* `KERNEL_PARTITION` - The index (in decimal) of the partition containing the kernel.
+* `KERNEL_PATH` - The path of the kernel in said partition, forward slashes to delimit directories.
+* `KERNEL_PROTO` - The boot protocol that will be used to boot the kernel. Valid protocols are: `linux`, `stivale`.
+* `KERNEL_CMDLINE` - The command line string to be passed to the kernel.
+
+*Locally assignable (protocol specific)* keys are:
+* Linux protocol:
+  * `INITRD_PARTITION` - Partition index of the initial ramdisk.
+  * `INITRD_PATH` - The path to the initial ramdisk.
+* stivale protocol:
+  * `MODULE_PARTITION` - Partition index of a module.
+  * `MODULE_PATH` - The path to a module.
+  * `MODULE_STRING` - A string to be passed to a module.
+  Note that one can define these 3 variable multiple times to specify multiple modules.
+  The entries will be matched in order. E.g.: the 1st partition entry will be matched
+  to the 1st path and the 1st string entry that appear, and so on.
diff --git a/README.md b/README.md
index a47e7dd5..117712ce 100644
--- a/README.md
+++ b/README.md
@@ -39,6 +39,8 @@ wants to load.
 
 An example `qloader2.cfg` file can be found in `test/qloader2.cfg`.
 
+More info on the format of `qloader2.cfg` can be found in `CONFIG.md`.
+
 For example, to create an empty image file of 64MiB in size, 1 echfs partition
 on the image spanning the whole device, format it, copy the relevant files over,
 and install qloader2, one can do: