diff --git a/site/en/reference/test-encyclopedia.md b/site/en/reference/test-encyclopedia.md
index ffbd719317b140..4872c25c634569 100644
--- a/site/en/reference/test-encyclopedia.md
+++ b/site/en/reference/test-encyclopedia.md
@@ -452,6 +452,11 @@ The initial environment block shall be composed as follows:
              class="external">JUnit test result schema</a>.</td>
     <td>optional</td>
   </tr>
+  <tr>
+    <td><code>BAZEL_TEST</code></td>
+    <td>Signifies test executable is being driven by <code>bazel test</code></td>
+    <td>required</td>
+  </tr>
 </table>
 
 The environment may contain additional entries. Tests should not depend on the
diff --git a/tools/test/test-setup.sh b/tools/test/test-setup.sh
index 182507fcdb57e0..1cc73137d75653 100755
--- a/tools/test/test-setup.sh
+++ b/tools/test/test-setup.sh
@@ -37,6 +37,11 @@ function is_absolute {
 # root.
 EXEC_ROOT="$PWD"
 
+# Declare that the executable is running in a `bazel test` environment
+# This allows test frameworks to enable output to the unprefixed environment variable
+# For example, if `BAZEL_TEST` and `XML_OUTPUT_FILE` are defined, write JUnit output
+export BAZEL_TEST=1
+
 # Bazel sets some environment vars to relative paths to improve caching and
 # support remote execution, where the absolute path may not be known to Bazel.
 # Convert them to absolute paths here before running the actual test.