diff --git a/app/services/ci/create_pipeline_builds_service.rb b/app/services/ci/create_pipeline_builds_service.rb
index 005014fa1ded2e94b350f06aad0ec2bf1613106f..b7da3f8e7eb04dbdf540608ded89e17119157c8d 100644
--- a/app/services/ci/create_pipeline_builds_service.rb
+++ b/app/services/ci/create_pipeline_builds_service.rb
@@ -10,18 +10,29 @@ module Ci
       end
     end
 
+    def project
+      pipeline.project
+    end
+
     private
 
     def create_build(build_attributes)
       build_attributes = build_attributes.merge(
         pipeline: pipeline,
-        project: pipeline.project,
+        project: project,
         ref: pipeline.ref,
         tag: pipeline.tag,
         user: current_user,
         trigger_request: trigger_request
       )
-      pipeline.builds.create(build_attributes)
+      build = pipeline.builds.create(build_attributes)
+
+      # Create the environment before the build starts. This sets its slug and
+      # makes it available as an environment variable
+      project.environments.find_or_create_by(name: build.expanded_environment_name) if
+        build.has_environment?
+
+      build
     end
 
     def new_builds
diff --git a/spec/models/environment_spec.rb b/spec/models/environment_spec.rb
index 706f1a5cd1c1c12843b73067a164f187fe967489..97cbb093ed264e9cd7b86a5879b72deb82aa3cc8 100644
--- a/spec/models/environment_spec.rb
+++ b/spec/models/environment_spec.rb
@@ -223,7 +223,7 @@ describe Environment, models: true do
       "foo-"                      => "foo" + SUFFIX,
     }.each do |name, matcher|
       it "returns a slug matching #{matcher}, given #{name}" do
-        slug = described_class.new(name: name).generate_clean_name
+        slug = described_class.new(name: name).generate_slug
 
         expect(slug).to match(/\A#{matcher}\z/)
       end
diff --git a/spec/services/ci/create_pipeline_service_spec.rb b/spec/services/ci/create_pipeline_service_spec.rb
index 4aadd009f3ecf0316e6ae28b9de734f317a29e69..ceaca96e25b377a1ace0e89bef1de526261ea9d1 100644
--- a/spec/services/ci/create_pipeline_service_spec.rb
+++ b/spec/services/ci/create_pipeline_service_spec.rb
@@ -210,5 +210,22 @@ describe Ci::CreatePipelineService, services: true do
         expect(result.manual_actions).not_to be_empty
       end
     end
+
+    context 'with environment' do
+      before do
+        config = YAML.dump(deploy: { environment: { name: "review/$CI_BUILD_REF_NAME" }, script: 'ls' })
+        stub_ci_pipeline_yaml_file(config)
+      end
+
+      it 'creates the environment' do
+        result = execute(ref: 'refs/heads/master',
+                         before: '00000000',
+                         after: project.commit.id,
+                         commits: [{ message: 'some msg' }])
+
+        expect(result).to be_persisted
+        expect(Environment.find_by(name: "review/master")).not_to be_nil
+      end
+    end
   end
 end