From 56dcd3f0a7398bfda2fb517886d6690e9f0018b5 Mon Sep 17 00:00:00 2001
From: Andrew Nester <andrew.nester@databricks.com>
Date: Thu, 17 Aug 2023 17:22:32 +0200
Subject: [PATCH] Renamed `environments` to `targets` in bundle configuration
 (#670)

## Changes
Renamed Environments to Targets in bundle.yml.

The change is backward-compatible and customers can continue to use
`environments` in the time being.

## Tests
Added tests which checks that both `environments` and `targets` sections
in bundle.yml works correctly
---
 bundle/bundle.go                              | 10 +--
 bundle/bundle_test.go                         | 16 ++--
 bundle/config/bundle.go                       |  9 +-
 bundle/config/mutator/default_environment.go  | 37 --------
 bundle/config/mutator/default_target.go       | 37 ++++++++
 ...ronment_test.go => default_target_test.go} | 16 ++--
 .../config/mutator/default_workspace_root.go  |  6 +-
 .../mutator/default_workspace_root_test.go    |  4 +-
 bundle/config/mutator/mutator.go              |  6 +-
 bundle/config/mutator/override_compute.go     |  2 +-
 ...ronment_mode.go => process_target_mode.go} | 20 ++---
 ...de_test.go => process_target_mode_test.go} | 22 ++---
 .../mutator/select_default_environment.go     | 54 -----------
 .../select_default_environment_test.go        | 90 -------------------
 .../config/mutator/select_default_target.go   | 54 +++++++++++
 .../mutator/select_default_target_test.go     | 90 +++++++++++++++++++
 bundle/config/mutator/select_environment.go   | 48 ----------
 bundle/config/mutator/select_target.go        | 54 +++++++++++
 ...ironment_test.go => select_target_test.go} | 14 +--
 bundle/config/resources.go                    |  2 +-
 bundle/config/resources/job.go                |  2 +-
 bundle/config/root.go                         | 70 +++++++++------
 bundle/config/root_test.go                    | 12 +--
 bundle/config/{environment.go => target.go}   | 12 +--
 bundle/config/variable/variable.go            |  2 +-
 bundle/config/workspace.go                    |  2 +-
 bundle/deploy/terraform/init_test.go          | 16 ++--
 bundle/deploy/terraform/load_test.go          |  2 +-
 bundle/phases/initialize.go                   |  2 +-
 bundle/schema/README.md                       |  4 +-
 bundle/schema/docs.go                         | 16 ++--
 bundle/schema/docs/bundle_descriptions.json   |  6 +-
 bundle/tests/autoload_git/databricks.yml      |  2 +-
 bundle/tests/environment_empty/databricks.yml |  5 --
 bundle/tests/environment_empty_test.go        | 12 ---
 bundle/tests/environment_git_test.go          | 20 +++++
 bundle/tests/environment_overrides_test.go    |  8 +-
 .../environments_autoload_git/databricks.yml  | 11 +++
 .../databricks.yml                            | 44 +++++++++
 .../environments_job_and_pipeline_test.go     | 56 ++++++++++++
 .../databricks.yml                            | 35 ++++++++
 .../environments_override_job_cluster_test.go | 29 ++++++
 bundle/tests/git_test.go                      |  2 +-
 .../tests/interpolation_target/databricks.yml | 14 +++
 bundle/tests/interpolation_test.go            | 12 +++
 bundle/tests/job_and_pipeline/databricks.yml  |  2 +-
 bundle/tests/job_and_pipeline_test.go         |  6 +-
 bundle/tests/loader.go                        |  4 +-
 .../tests/override_job_cluster/databricks.yml |  2 +-
 bundle/tests/override_job_cluster_test.go     |  4 +-
 bundle/tests/target_empty/databricks.yml      |  5 ++
 bundle/tests/target_empty_test.go             | 12 +++
 .../target_overrides/resources/databricks.yml | 20 +++++
 .../target_overrides/workspace/databricks.yml | 14 +++
 bundle/tests/target_overrides_test.go         | 27 ++++++
 .../variables/env_overrides/databricks.yml    |  2 +-
 bundle/tests/variables_test.go                | 20 ++---
 cmd/bundle/variables.go                       |  2 +-
 cmd/configure/configure.go                    |  2 +-
 cmd/root/bundle.go                            | 48 +++++++---
 cmd/root/bundle_test.go                       | 24 +++++
 cmd/root/root.go                              |  1 +
 cmd/sync/sync_test.go                         |  2 +-
 63 files changed, 768 insertions(+), 416 deletions(-)
 delete mode 100644 bundle/config/mutator/default_environment.go
 create mode 100644 bundle/config/mutator/default_target.go
 rename bundle/config/mutator/{default_environment_test.go => default_target_test.go} (51%)
 rename bundle/config/mutator/{process_environment_mode.go => process_target_mode.go} (89%)
 rename bundle/config/mutator/{process_environment_mode_test.go => process_target_mode_test.go} (90%)
 delete mode 100644 bundle/config/mutator/select_default_environment.go
 delete mode 100644 bundle/config/mutator/select_default_environment_test.go
 create mode 100644 bundle/config/mutator/select_default_target.go
 create mode 100644 bundle/config/mutator/select_default_target_test.go
 delete mode 100644 bundle/config/mutator/select_environment.go
 create mode 100644 bundle/config/mutator/select_target.go
 rename bundle/config/mutator/{select_environment_test.go => select_target_test.go} (62%)
 rename bundle/config/{environment.go => target.go} (80%)
 delete mode 100644 bundle/tests/environment_empty/databricks.yml
 delete mode 100644 bundle/tests/environment_empty_test.go
 create mode 100644 bundle/tests/environment_git_test.go
 create mode 100644 bundle/tests/environments_autoload_git/databricks.yml
 create mode 100644 bundle/tests/environments_job_and_pipeline/databricks.yml
 create mode 100644 bundle/tests/environments_job_and_pipeline_test.go
 create mode 100644 bundle/tests/environments_override_job_cluster/databricks.yml
 create mode 100644 bundle/tests/environments_override_job_cluster_test.go
 create mode 100644 bundle/tests/interpolation_target/databricks.yml
 create mode 100644 bundle/tests/target_empty/databricks.yml
 create mode 100644 bundle/tests/target_empty_test.go
 create mode 100644 bundle/tests/target_overrides/resources/databricks.yml
 create mode 100644 bundle/tests/target_overrides/workspace/databricks.yml
 create mode 100644 bundle/tests/target_overrides_test.go

diff --git a/bundle/bundle.go b/bundle/bundle.go
index 06c68fe8..a5eaa289 100644
--- a/bundle/bundle.go
+++ b/bundle/bundle.go
@@ -117,10 +117,10 @@ func (b *Bundle) WorkspaceClient() *databricks.WorkspaceClient {
 }
 
 // CacheDir returns directory to use for temporary files for this bundle.
-// Scoped to the bundle's environment.
+// Scoped to the bundle's target.
 func (b *Bundle) CacheDir(paths ...string) (string, error) {
-	if b.Config.Bundle.Environment == "" {
-		panic("environment not set")
+	if b.Config.Bundle.Target == "" {
+		panic("target not set")
 	}
 
 	cacheDirName, exists := os.LookupEnv("DATABRICKS_BUNDLE_TMP")
@@ -138,8 +138,8 @@ func (b *Bundle) CacheDir(paths ...string) (string, error) {
 	// Fixed components of the result path.
 	parts := []string{
 		cacheDirName,
-		// Scope with environment name.
-		b.Config.Bundle.Environment,
+		// Scope with target name.
+		b.Config.Bundle.Target,
 	}
 
 	// Append dynamic components of the result path.
diff --git a/bundle/bundle_test.go b/bundle/bundle_test.go
index ac947500..4a3e7f2c 100644
--- a/bundle/bundle_test.go
+++ b/bundle/bundle_test.go
@@ -31,16 +31,16 @@ func TestBundleCacheDir(t *testing.T) {
 	bundle, err := Load(context.Background(), projectDir)
 	require.NoError(t, err)
 
-	// Artificially set environment.
-	// This is otherwise done by [mutators.SelectEnvironment].
-	bundle.Config.Bundle.Environment = "default"
+	// Artificially set target.
+	// This is otherwise done by [mutators.SelectTarget].
+	bundle.Config.Bundle.Target = "default"
 
 	// unset env variable in case it's set
 	t.Setenv("DATABRICKS_BUNDLE_TMP", "")
 
 	cacheDir, err := bundle.CacheDir()
 
-	// format is <CWD>/.databricks/bundle/<environment>
+	// format is <CWD>/.databricks/bundle/<target>
 	assert.NoError(t, err)
 	assert.Equal(t, filepath.Join(projectDir, ".databricks", "bundle", "default"), cacheDir)
 }
@@ -55,16 +55,16 @@ func TestBundleCacheDirOverride(t *testing.T) {
 	bundle, err := Load(context.Background(), projectDir)
 	require.NoError(t, err)
 
-	// Artificially set environment.
-	// This is otherwise done by [mutators.SelectEnvironment].
-	bundle.Config.Bundle.Environment = "default"
+	// Artificially set target.
+	// This is otherwise done by [mutators.SelectTarget].
+	bundle.Config.Bundle.Target = "default"
 
 	// now we expect to use 'bundleTmpDir' instead of CWD/.databricks/bundle
 	t.Setenv("DATABRICKS_BUNDLE_TMP", bundleTmpDir)
 
 	cacheDir, err := bundle.CacheDir()
 
-	// format is <DATABRICKS_BUNDLE_TMP>/<environment>
+	// format is <DATABRICKS_BUNDLE_TMP>/<target>
 	assert.NoError(t, err)
 	assert.Equal(t, filepath.Join(bundleTmpDir, "default"), cacheDir)
 }
diff --git a/bundle/config/bundle.go b/bundle/config/bundle.go
index f3401477..d444f507 100644
--- a/bundle/config/bundle.go
+++ b/bundle/config/bundle.go
@@ -15,7 +15,10 @@ type Bundle struct {
 	// Default warehouse to run SQL on.
 	// DefaultWarehouse string `json:"default_warehouse,omitempty"`
 
-	// Environment is set by the mutator that selects the environment.
+	// Target is set by the mutator that selects the target.
+	Target string `json:"target,omitempty" bundle:"readonly"`
+
+	// DEPRECATED. Left for backward compatibility with Target
 	Environment string `json:"environment,omitempty" bundle:"readonly"`
 
 	// Terraform holds configuration related to Terraform.
@@ -32,10 +35,10 @@ type Bundle struct {
 	// origin url. Automatically loaded by reading .git directory if not specified
 	Git Git `json:"git,omitempty"`
 
-	// Determines the mode of the environment.
+	// Determines the mode of the target.
 	// For example, 'mode: development' can be used for deployments for
 	// development purposes.
-	// Annotated readonly as this should be set at the environment level.
+	// Annotated readonly as this should be set at the target level.
 	Mode Mode `json:"mode,omitempty" bundle:"readonly"`
 
 	// Overrides the compute used for jobs and other supported assets.
diff --git a/bundle/config/mutator/default_environment.go b/bundle/config/mutator/default_environment.go
deleted file mode 100644
index 1598a647..00000000
--- a/bundle/config/mutator/default_environment.go
+++ /dev/null
@@ -1,37 +0,0 @@
-package mutator
-
-import (
-	"context"
-	"fmt"
-
-	"github.com/databricks/cli/bundle"
-	"github.com/databricks/cli/bundle/config"
-)
-
-type defineDefaultEnvironment struct {
-	name string
-}
-
-// DefineDefaultEnvironment adds an environment named "default"
-// to the configuration if none have been defined.
-func DefineDefaultEnvironment() bundle.Mutator {
-	return &defineDefaultEnvironment{
-		name: "default",
-	}
-}
-
-func (m *defineDefaultEnvironment) Name() string {
-	return fmt.Sprintf("DefineDefaultEnvironment(%s)", m.name)
-}
-
-func (m *defineDefaultEnvironment) Apply(_ context.Context, b *bundle.Bundle) error {
-	// Nothing to do if the configuration has at least 1 environment.
-	if len(b.Config.Environments) > 0 {
-		return nil
-	}
-
-	// Define default environment.
-	b.Config.Environments = make(map[string]*config.Environment)
-	b.Config.Environments[m.name] = &config.Environment{}
-	return nil
-}
diff --git a/bundle/config/mutator/default_target.go b/bundle/config/mutator/default_target.go
new file mode 100644
index 00000000..d5318a3e
--- /dev/null
+++ b/bundle/config/mutator/default_target.go
@@ -0,0 +1,37 @@
+package mutator
+
+import (
+	"context"
+	"fmt"
+
+	"github.com/databricks/cli/bundle"
+	"github.com/databricks/cli/bundle/config"
+)
+
+type defineDefaultTarget struct {
+	name string
+}
+
+// DefineDefaultTarget adds a target named "default"
+// to the configuration if none have been defined.
+func DefineDefaultTarget() bundle.Mutator {
+	return &defineDefaultTarget{
+		name: "default",
+	}
+}
+
+func (m *defineDefaultTarget) Name() string {
+	return fmt.Sprintf("DefineDefaultTarget(%s)", m.name)
+}
+
+func (m *defineDefaultTarget) Apply(_ context.Context, b *bundle.Bundle) error {
+	// Nothing to do if the configuration has at least 1 target.
+	if len(b.Config.Targets) > 0 {
+		return nil
+	}
+
+	// Define default target.
+	b.Config.Targets = make(map[string]*config.Target)
+	b.Config.Targets[m.name] = &config.Target{}
+	return nil
+}
diff --git a/bundle/config/mutator/default_environment_test.go b/bundle/config/mutator/default_target_test.go
similarity index 51%
rename from bundle/config/mutator/default_environment_test.go
rename to bundle/config/mutator/default_target_test.go
index f196e5ba..49fbe6de 100644
--- a/bundle/config/mutator/default_environment_test.go
+++ b/bundle/config/mutator/default_target_test.go
@@ -11,25 +11,25 @@ import (
 	"github.com/stretchr/testify/require"
 )
 
-func TestDefaultEnvironment(t *testing.T) {
+func TestDefaultTarget(t *testing.T) {
 	bundle := &bundle.Bundle{}
-	err := mutator.DefineDefaultEnvironment().Apply(context.Background(), bundle)
+	err := mutator.DefineDefaultTarget().Apply(context.Background(), bundle)
 	require.NoError(t, err)
-	env, ok := bundle.Config.Environments["default"]
+	env, ok := bundle.Config.Targets["default"]
 	assert.True(t, ok)
-	assert.Equal(t, &config.Environment{}, env)
+	assert.Equal(t, &config.Target{}, env)
 }
 
-func TestDefaultEnvironmentAlreadySpecified(t *testing.T) {
+func TestDefaultTargetAlreadySpecified(t *testing.T) {
 	bundle := &bundle.Bundle{
 		Config: config.Root{
-			Environments: map[string]*config.Environment{
+			Targets: map[string]*config.Target{
 				"development": {},
 			},
 		},
 	}
-	err := mutator.DefineDefaultEnvironment().Apply(context.Background(), bundle)
+	err := mutator.DefineDefaultTarget().Apply(context.Background(), bundle)
 	require.NoError(t, err)
-	_, ok := bundle.Config.Environments["default"]
+	_, ok := bundle.Config.Targets["default"]
 	assert.False(t, ok)
 }
diff --git a/bundle/config/mutator/default_workspace_root.go b/bundle/config/mutator/default_workspace_root.go
index bf51eda9..260a5958 100644
--- a/bundle/config/mutator/default_workspace_root.go
+++ b/bundle/config/mutator/default_workspace_root.go
@@ -27,14 +27,14 @@ func (m *defineDefaultWorkspaceRoot) Apply(ctx context.Context, b *bundle.Bundle
 		return fmt.Errorf("unable to define default workspace root: bundle name not defined")
 	}
 
-	if b.Config.Bundle.Environment == "" {
-		return fmt.Errorf("unable to define default workspace root: bundle environment not selected")
+	if b.Config.Bundle.Target == "" {
+		return fmt.Errorf("unable to define default workspace root: bundle target not selected")
 	}
 
 	b.Config.Workspace.RootPath = fmt.Sprintf(
 		"~/.bundle/%s/%s",
 		b.Config.Bundle.Name,
-		b.Config.Bundle.Environment,
+		b.Config.Bundle.Target,
 	)
 	return nil
 }
diff --git a/bundle/config/mutator/default_workspace_root_test.go b/bundle/config/mutator/default_workspace_root_test.go
index 4a78e6e5..1822dca0 100644
--- a/bundle/config/mutator/default_workspace_root_test.go
+++ b/bundle/config/mutator/default_workspace_root_test.go
@@ -15,8 +15,8 @@ func TestDefaultWorkspaceRoot(t *testing.T) {
 	bundle := &bundle.Bundle{
 		Config: config.Root{
 			Bundle: config.Bundle{
-				Name:        "name",
-				Environment: "environment",
+				Name:   "name",
+				Target: "environment",
 			},
 		},
 	}
diff --git a/bundle/config/mutator/mutator.go b/bundle/config/mutator/mutator.go
index 058258c8..ff1f96f5 100644
--- a/bundle/config/mutator/mutator.go
+++ b/bundle/config/mutator/mutator.go
@@ -7,11 +7,11 @@ import (
 func DefaultMutators() []bundle.Mutator {
 	return []bundle.Mutator{
 		ProcessRootIncludes(),
-		DefineDefaultEnvironment(),
+		DefineDefaultTarget(),
 		LoadGitDetails(),
 	}
 }
 
-func DefaultMutatorsForEnvironment(env string) []bundle.Mutator {
-	return append(DefaultMutators(), SelectEnvironment(env))
+func DefaultMutatorsForTarget(env string) []bundle.Mutator {
+	return append(DefaultMutators(), SelectTarget(env))
 }
diff --git a/bundle/config/mutator/override_compute.go b/bundle/config/mutator/override_compute.go
index ba3fd994..12439249 100644
--- a/bundle/config/mutator/override_compute.go
+++ b/bundle/config/mutator/override_compute.go
@@ -35,7 +35,7 @@ func overrideJobCompute(j *resources.Job, compute string) {
 func (m *overrideCompute) Apply(ctx context.Context, b *bundle.Bundle) error {
 	if b.Config.Bundle.Mode != config.Development {
 		if b.Config.Bundle.ComputeID != "" {
-			return fmt.Errorf("cannot override compute for an environment that does not use 'mode: development'")
+			return fmt.Errorf("cannot override compute for an target that does not use 'mode: development'")
 		}
 		return nil
 	}
diff --git a/bundle/config/mutator/process_environment_mode.go b/bundle/config/mutator/process_target_mode.go
similarity index 89%
rename from bundle/config/mutator/process_environment_mode.go
rename to bundle/config/mutator/process_target_mode.go
index d2030234..b5dc2559 100644
--- a/bundle/config/mutator/process_environment_mode.go
+++ b/bundle/config/mutator/process_target_mode.go
@@ -13,16 +13,16 @@ import (
 	"github.com/databricks/databricks-sdk-go/service/ml"
 )
 
-type processEnvironmentMode struct{}
+type processTargetMode struct{}
 
 const developmentConcurrentRuns = 4
 
-func ProcessEnvironmentMode() bundle.Mutator {
-	return &processEnvironmentMode{}
+func ProcessTargetMode() bundle.Mutator {
+	return &processTargetMode{}
 }
 
-func (m *processEnvironmentMode) Name() string {
-	return "ProcessEnvironmentMode"
+func (m *processTargetMode) Name() string {
+	return "ProcessTargetMode"
 }
 
 // Mark all resources as being for 'development' purposes, i.e.
@@ -110,14 +110,14 @@ func findIncorrectPath(b *bundle.Bundle, mode config.Mode) string {
 
 func validateProductionMode(ctx context.Context, b *bundle.Bundle, isPrincipalUsed bool) error {
 	if b.Config.Bundle.Git.Inferred {
-		env := b.Config.Bundle.Environment
-		return fmt.Errorf("environment with 'mode: production' must specify an explicit 'environments.%s.git' configuration", env)
+		env := b.Config.Bundle.Target
+		return fmt.Errorf("target with 'mode: production' must specify an explicit 'targets.%s.git' configuration", env)
 	}
 
 	r := b.Config.Resources
 	for i := range r.Pipelines {
 		if r.Pipelines[i].Development {
-			return fmt.Errorf("environment with 'mode: production' cannot specify a pipeline with 'development: true'")
+			return fmt.Errorf("target with 'mode: production' cannot specify a pipeline with 'development: true'")
 		}
 	}
 
@@ -125,7 +125,7 @@ func validateProductionMode(ctx context.Context, b *bundle.Bundle, isPrincipalUs
 		if path := findIncorrectPath(b, config.Production); path != "" {
 			message := "%s must not contain the current username when using 'mode: production'"
 			if path == "root_path" {
-				return fmt.Errorf(message+"\n  tip: set workspace.root_path to a shared path such as /Shared/.bundle/${bundle.name}/${bundle.environment}", path)
+				return fmt.Errorf(message+"\n  tip: set workspace.root_path to a shared path such as /Shared/.bundle/${bundle.name}/${bundle.target}", path)
 			} else {
 				return fmt.Errorf(message, path)
 			}
@@ -165,7 +165,7 @@ func isRunAsSet(r config.Resources) bool {
 	return true
 }
 
-func (m *processEnvironmentMode) Apply(ctx context.Context, b *bundle.Bundle) error {
+func (m *processTargetMode) Apply(ctx context.Context, b *bundle.Bundle) error {
 	switch b.Config.Bundle.Mode {
 	case config.Development:
 		err := validateDevelopmentMode(b)
diff --git a/bundle/config/mutator/process_environment_mode_test.go b/bundle/config/mutator/process_target_mode_test.go
similarity index 90%
rename from bundle/config/mutator/process_environment_mode_test.go
rename to bundle/config/mutator/process_target_mode_test.go
index 36e0396e..76db64de 100644
--- a/bundle/config/mutator/process_environment_mode_test.go
+++ b/bundle/config/mutator/process_target_mode_test.go
@@ -58,10 +58,10 @@ func mockBundle(mode config.Mode) *bundle.Bundle {
 	}
 }
 
-func TestProcessEnvironmentModeDevelopment(t *testing.T) {
+func TestProcessTargetModeDevelopment(t *testing.T) {
 	bundle := mockBundle(config.Development)
 
-	m := ProcessEnvironmentMode()
+	m := ProcessTargetMode()
 	err := m.Apply(context.Background(), bundle)
 	require.NoError(t, err)
 	assert.Equal(t, "[dev lennart] job1", bundle.Config.Resources.Jobs["job1"].Name)
@@ -73,10 +73,10 @@ func TestProcessEnvironmentModeDevelopment(t *testing.T) {
 	assert.True(t, bundle.Config.Resources.Pipelines["pipeline1"].PipelineSpec.Development)
 }
 
-func TestProcessEnvironmentModeDefault(t *testing.T) {
+func TestProcessTargetModeDefault(t *testing.T) {
 	bundle := mockBundle("")
 
-	m := ProcessEnvironmentMode()
+	m := ProcessTargetMode()
 	err := m.Apply(context.Background(), bundle)
 	require.NoError(t, err)
 	assert.Equal(t, "job1", bundle.Config.Resources.Jobs["job1"].Name)
@@ -84,7 +84,7 @@ func TestProcessEnvironmentModeDefault(t *testing.T) {
 	assert.False(t, bundle.Config.Resources.Pipelines["pipeline1"].PipelineSpec.Development)
 }
 
-func TestProcessEnvironmentModeProduction(t *testing.T) {
+func TestProcessTargetModeProduction(t *testing.T) {
 	bundle := mockBundle(config.Production)
 
 	err := validateProductionMode(context.Background(), bundle, false)
@@ -118,7 +118,7 @@ func TestProcessEnvironmentModeProduction(t *testing.T) {
 	assert.False(t, bundle.Config.Resources.Pipelines["pipeline1"].PipelineSpec.Development)
 }
 
-func TestProcessEnvironmentModeProductionGit(t *testing.T) {
+func TestProcessTargetModeProductionGit(t *testing.T) {
 	bundle := mockBundle(config.Production)
 
 	// Pretend the user didn't set Git configuration explicitly
@@ -129,10 +129,10 @@ func TestProcessEnvironmentModeProductionGit(t *testing.T) {
 	bundle.Config.Bundle.Git.Inferred = false
 }
 
-func TestProcessEnvironmentModeProductionOkForPrincipal(t *testing.T) {
+func TestProcessTargetModeProductionOkForPrincipal(t *testing.T) {
 	bundle := mockBundle(config.Production)
 
-	// Our environment has all kinds of problems when not using service principals ...
+	// Our target has all kinds of problems when not using service principals ...
 	err := validateProductionMode(context.Background(), bundle, false)
 	require.Error(t, err)
 
@@ -152,7 +152,7 @@ func TestAllResourcesMocked(t *testing.T) {
 			assert.True(
 				t,
 				!field.IsNil() && field.Len() > 0,
-				"process_environment_mode should support '%s' (please add it to process_environment_mode.go and extend the test suite)",
+				"process_target_mode should support '%s' (please add it to process_target_mode.go and extend the test suite)",
 				resources.Type().Field(i).Name,
 			)
 		}
@@ -164,7 +164,7 @@ func TestAllResourcesRenamed(t *testing.T) {
 	bundle := mockBundle(config.Development)
 	resources := reflect.ValueOf(bundle.Config.Resources)
 
-	m := ProcessEnvironmentMode()
+	m := ProcessTargetMode()
 	err := m.Apply(context.Background(), bundle)
 	require.NoError(t, err)
 
@@ -179,7 +179,7 @@ func TestAllResourcesRenamed(t *testing.T) {
 					assert.True(
 						t,
 						strings.Contains(nameField.String(), "dev"),
-						"process_environment_mode should rename '%s' in '%s'",
+						"process_target_mode should rename '%s' in '%s'",
 						key,
 						resources.Type().Field(i).Name,
 					)
diff --git a/bundle/config/mutator/select_default_environment.go b/bundle/config/mutator/select_default_environment.go
deleted file mode 100644
index 0ed1d2db..00000000
--- a/bundle/config/mutator/select_default_environment.go
+++ /dev/null
@@ -1,54 +0,0 @@
-package mutator
-
-import (
-	"context"
-	"fmt"
-	"strings"
-
-	"github.com/databricks/cli/bundle"
-	"golang.org/x/exp/maps"
-)
-
-type selectDefaultEnvironment struct{}
-
-// SelectDefaultEnvironment merges the default environment into the root configuration.
-func SelectDefaultEnvironment() bundle.Mutator {
-	return &selectDefaultEnvironment{}
-}
-
-func (m *selectDefaultEnvironment) Name() string {
-	return "SelectDefaultEnvironment"
-}
-
-func (m *selectDefaultEnvironment) Apply(ctx context.Context, b *bundle.Bundle) error {
-	if len(b.Config.Environments) == 0 {
-		return fmt.Errorf("no environments defined")
-	}
-
-	// One environment means there's only one default.
-	names := maps.Keys(b.Config.Environments)
-	if len(names) == 1 {
-		return SelectEnvironment(names[0]).Apply(ctx, b)
-	}
-
-	// Multiple environments means we look for the `default` flag.
-	var defaults []string
-	for name, env := range b.Config.Environments {
-		if env != nil && env.Default {
-			defaults = append(defaults, name)
-		}
-	}
-
-	// It is invalid to have multiple environments with the `default` flag set.
-	if len(defaults) > 1 {
-		return fmt.Errorf("multiple environments are marked as default (%s)", strings.Join(defaults, ", "))
-	}
-
-	// If no environment has the `default` flag set, ask the user to specify one.
-	if len(defaults) == 0 {
-		return fmt.Errorf("please specify environment")
-	}
-
-	// One default remaining.
-	return SelectEnvironment(defaults[0]).Apply(ctx, b)
-}
diff --git a/bundle/config/mutator/select_default_environment_test.go b/bundle/config/mutator/select_default_environment_test.go
deleted file mode 100644
index cc8f9c01..00000000
--- a/bundle/config/mutator/select_default_environment_test.go
+++ /dev/null
@@ -1,90 +0,0 @@
-package mutator_test
-
-import (
-	"context"
-	"testing"
-
-	"github.com/databricks/cli/bundle"
-	"github.com/databricks/cli/bundle/config"
-	"github.com/databricks/cli/bundle/config/mutator"
-	"github.com/stretchr/testify/assert"
-)
-
-func TestSelectDefaultEnvironmentNoEnvironments(t *testing.T) {
-	bundle := &bundle.Bundle{
-		Config: config.Root{
-			Environments: map[string]*config.Environment{},
-		},
-	}
-	err := mutator.SelectDefaultEnvironment().Apply(context.Background(), bundle)
-	assert.ErrorContains(t, err, "no environments defined")
-}
-
-func TestSelectDefaultEnvironmentSingleEnvironments(t *testing.T) {
-	bundle := &bundle.Bundle{
-		Config: config.Root{
-			Environments: map[string]*config.Environment{
-				"foo": {},
-			},
-		},
-	}
-	err := mutator.SelectDefaultEnvironment().Apply(context.Background(), bundle)
-	assert.NoError(t, err)
-	assert.Equal(t, "foo", bundle.Config.Bundle.Environment)
-}
-
-func TestSelectDefaultEnvironmentNoDefaults(t *testing.T) {
-	bundle := &bundle.Bundle{
-		Config: config.Root{
-			Environments: map[string]*config.Environment{
-				"foo": {},
-				"bar": {},
-				"qux": {},
-			},
-		},
-	}
-	err := mutator.SelectDefaultEnvironment().Apply(context.Background(), bundle)
-	assert.ErrorContains(t, err, "please specify environment")
-}
-
-func TestSelectDefaultEnvironmentNoDefaultsWithNil(t *testing.T) {
-	bundle := &bundle.Bundle{
-		Config: config.Root{
-			Environments: map[string]*config.Environment{
-				"foo": nil,
-				"bar": nil,
-			},
-		},
-	}
-	err := mutator.SelectDefaultEnvironment().Apply(context.Background(), bundle)
-	assert.ErrorContains(t, err, "please specify environment")
-}
-
-func TestSelectDefaultEnvironmentMultipleDefaults(t *testing.T) {
-	bundle := &bundle.Bundle{
-		Config: config.Root{
-			Environments: map[string]*config.Environment{
-				"foo": {Default: true},
-				"bar": {Default: true},
-				"qux": {Default: true},
-			},
-		},
-	}
-	err := mutator.SelectDefaultEnvironment().Apply(context.Background(), bundle)
-	assert.ErrorContains(t, err, "multiple environments are marked as default")
-}
-
-func TestSelectDefaultEnvironmentSingleDefault(t *testing.T) {
-	bundle := &bundle.Bundle{
-		Config: config.Root{
-			Environments: map[string]*config.Environment{
-				"foo": {},
-				"bar": {Default: true},
-				"qux": {},
-			},
-		},
-	}
-	err := mutator.SelectDefaultEnvironment().Apply(context.Background(), bundle)
-	assert.NoError(t, err)
-	assert.Equal(t, "bar", bundle.Config.Bundle.Environment)
-}
diff --git a/bundle/config/mutator/select_default_target.go b/bundle/config/mutator/select_default_target.go
new file mode 100644
index 00000000..8abcfe4f
--- /dev/null
+++ b/bundle/config/mutator/select_default_target.go
@@ -0,0 +1,54 @@
+package mutator
+
+import (
+	"context"
+	"fmt"
+	"strings"
+
+	"github.com/databricks/cli/bundle"
+	"golang.org/x/exp/maps"
+)
+
+type selectDefaultTarget struct{}
+
+// SelectDefaultTarget merges the default target into the root configuration.
+func SelectDefaultTarget() bundle.Mutator {
+	return &selectDefaultTarget{}
+}
+
+func (m *selectDefaultTarget) Name() string {
+	return "SelectDefaultTarget"
+}
+
+func (m *selectDefaultTarget) Apply(ctx context.Context, b *bundle.Bundle) error {
+	if len(b.Config.Targets) == 0 {
+		return fmt.Errorf("no targets defined")
+	}
+
+	// One target means there's only one default.
+	names := maps.Keys(b.Config.Targets)
+	if len(names) == 1 {
+		return SelectTarget(names[0]).Apply(ctx, b)
+	}
+
+	// Multiple targets means we look for the `default` flag.
+	var defaults []string
+	for name, env := range b.Config.Targets {
+		if env != nil && env.Default {
+			defaults = append(defaults, name)
+		}
+	}
+
+	// It is invalid to have multiple targets with the `default` flag set.
+	if len(defaults) > 1 {
+		return fmt.Errorf("multiple targets are marked as default (%s)", strings.Join(defaults, ", "))
+	}
+
+	// If no target has the `default` flag set, ask the user to specify one.
+	if len(defaults) == 0 {
+		return fmt.Errorf("please specify target")
+	}
+
+	// One default remaining.
+	return SelectTarget(defaults[0]).Apply(ctx, b)
+}
diff --git a/bundle/config/mutator/select_default_target_test.go b/bundle/config/mutator/select_default_target_test.go
new file mode 100644
index 00000000..5d7b93b2
--- /dev/null
+++ b/bundle/config/mutator/select_default_target_test.go
@@ -0,0 +1,90 @@
+package mutator_test
+
+import (
+	"context"
+	"testing"
+
+	"github.com/databricks/cli/bundle"
+	"github.com/databricks/cli/bundle/config"
+	"github.com/databricks/cli/bundle/config/mutator"
+	"github.com/stretchr/testify/assert"
+)
+
+func TestSelectDefaultTargetNoTargets(t *testing.T) {
+	bundle := &bundle.Bundle{
+		Config: config.Root{
+			Targets: map[string]*config.Target{},
+		},
+	}
+	err := mutator.SelectDefaultTarget().Apply(context.Background(), bundle)
+	assert.ErrorContains(t, err, "no targets defined")
+}
+
+func TestSelectDefaultTargetSingleTargets(t *testing.T) {
+	bundle := &bundle.Bundle{
+		Config: config.Root{
+			Targets: map[string]*config.Target{
+				"foo": {},
+			},
+		},
+	}
+	err := mutator.SelectDefaultTarget().Apply(context.Background(), bundle)
+	assert.NoError(t, err)
+	assert.Equal(t, "foo", bundle.Config.Bundle.Target)
+}
+
+func TestSelectDefaultTargetNoDefaults(t *testing.T) {
+	bundle := &bundle.Bundle{
+		Config: config.Root{
+			Targets: map[string]*config.Target{
+				"foo": {},
+				"bar": {},
+				"qux": {},
+			},
+		},
+	}
+	err := mutator.SelectDefaultTarget().Apply(context.Background(), bundle)
+	assert.ErrorContains(t, err, "please specify target")
+}
+
+func TestSelectDefaultTargetNoDefaultsWithNil(t *testing.T) {
+	bundle := &bundle.Bundle{
+		Config: config.Root{
+			Targets: map[string]*config.Target{
+				"foo": nil,
+				"bar": nil,
+			},
+		},
+	}
+	err := mutator.SelectDefaultTarget().Apply(context.Background(), bundle)
+	assert.ErrorContains(t, err, "please specify target")
+}
+
+func TestSelectDefaultTargetMultipleDefaults(t *testing.T) {
+	bundle := &bundle.Bundle{
+		Config: config.Root{
+			Targets: map[string]*config.Target{
+				"foo": {Default: true},
+				"bar": {Default: true},
+				"qux": {Default: true},
+			},
+		},
+	}
+	err := mutator.SelectDefaultTarget().Apply(context.Background(), bundle)
+	assert.ErrorContains(t, err, "multiple targets are marked as default")
+}
+
+func TestSelectDefaultTargetSingleDefault(t *testing.T) {
+	bundle := &bundle.Bundle{
+		Config: config.Root{
+			Targets: map[string]*config.Target{
+				"foo": {},
+				"bar": {Default: true},
+				"qux": {},
+			},
+		},
+	}
+	err := mutator.SelectDefaultTarget().Apply(context.Background(), bundle)
+	assert.NoError(t, err)
+	assert.Equal(t, "bar", bundle.Config.Bundle.Target)
+}
diff --git a/bundle/config/mutator/select_environment.go b/bundle/config/mutator/select_environment.go
deleted file mode 100644
index 6ced66e8..00000000
--- a/bundle/config/mutator/select_environment.go
+++ /dev/null
@@ -1,48 +0,0 @@
-package mutator
-
-import (
-	"context"
-	"fmt"
-
-	"github.com/databricks/cli/bundle"
-)
-
-type selectEnvironment struct {
-	name string
-}
-
-// SelectEnvironment merges the specified environment into the root configuration.
-func SelectEnvironment(name string) bundle.Mutator {
-	return &selectEnvironment{
-		name: name,
-	}
-}
-
-func (m *selectEnvironment) Name() string {
-	return fmt.Sprintf("SelectEnvironment(%s)", m.name)
-}
-
-func (m *selectEnvironment) Apply(_ context.Context, b *bundle.Bundle) error {
-	if b.Config.Environments == nil {
-		return fmt.Errorf("no environments defined")
-	}
-
-	// Get specified environment
-	env, ok := b.Config.Environments[m.name]
-	if !ok {
-		return fmt.Errorf("%s: no such environment", m.name)
-	}
-
-	// Merge specified environment into root configuration structure.
-	err := b.Config.MergeEnvironment(env)
-	if err != nil {
-		return err
-	}
-
-	// Store specified environment in configuration for reference.
-	b.Config.Bundle.Environment = m.name
-
-	// Clear environments after loading.
-	b.Config.Environments = nil
-	return nil
-}
diff --git a/bundle/config/mutator/select_target.go b/bundle/config/mutator/select_target.go
new file mode 100644
index 00000000..3be1f2e1
--- /dev/null
+++ b/bundle/config/mutator/select_target.go
@@ -0,0 +1,54 @@
+package mutator
+
+import (
+	"context"
+	"fmt"
+
+	"github.com/databricks/cli/bundle"
+)
+
+type selectTarget struct {
+	name string
+}
+
+// SelectTarget merges the specified target into the root configuration.
+func SelectTarget(name string) bundle.Mutator {
+	return &selectTarget{
+		name: name,
+	}
+}
+
+func (m *selectTarget) Name() string {
+	return fmt.Sprintf("SelectTarget(%s)", m.name)
+}
+
+func (m *selectTarget) Apply(_ context.Context, b *bundle.Bundle) error {
+	if b.Config.Targets == nil {
+		return fmt.Errorf("no targets defined")
+	}
+
+	// Get specified target
+	target, ok := b.Config.Targets[m.name]
+	if !ok {
+		return fmt.Errorf("%s: no such target", m.name)
+	}
+
+	// Merge specified target into root configuration structure.
+	err := b.Config.MergeTargetOverrides(target)
+	if err != nil {
+		return err
+	}
+
+	// Store specified target in configuration for reference.
+	b.Config.Bundle.Target = m.name
+
+	// We do this for backward compatibility.
+	// TODO: remove when Environments section is not supported anymore.
+	b.Config.Bundle.Environment = b.Config.Bundle.Target
+
+	// Clear targets after loading.
+	b.Config.Targets = nil
+	b.Config.Environments = nil
+
+	return nil
+}
diff --git a/bundle/config/mutator/select_environment_test.go b/bundle/config/mutator/select_target_test.go
similarity index 62%
rename from bundle/config/mutator/select_environment_test.go
rename to bundle/config/mutator/select_target_test.go
index 73b3a789..dfcd8cb0 100644
--- a/bundle/config/mutator/select_environment_test.go
+++ b/bundle/config/mutator/select_target_test.go
@@ -11,13 +11,13 @@ import (
 	"github.com/stretchr/testify/require"
 )
 
-func TestSelectEnvironment(t *testing.T) {
+func TestSelectTarget(t *testing.T) {
 	bundle := &bundle.Bundle{
 		Config: config.Root{
 			Workspace: config.Workspace{
 				Host: "foo",
 			},
-			Environments: map[string]*config.Environment{
+			Targets: map[string]*config.Target{
 				"default": {
 					Workspace: &config.Workspace{
 						Host: "bar",
@@ -26,19 +26,19 @@ func TestSelectEnvironment(t *testing.T) {
 			},
 		},
 	}
-	err := mutator.SelectEnvironment("default").Apply(context.Background(), bundle)
+	err := mutator.SelectTarget("default").Apply(context.Background(), bundle)
 	require.NoError(t, err)
 	assert.Equal(t, "bar", bundle.Config.Workspace.Host)
 }
 
-func TestSelectEnvironmentNotFound(t *testing.T) {
+func TestSelectTargetNotFound(t *testing.T) {
 	bundle := &bundle.Bundle{
 		Config: config.Root{
-			Environments: map[string]*config.Environment{
+			Targets: map[string]*config.Target{
 				"default": {},
 			},
 		},
 	}
-	err := mutator.SelectEnvironment("doesnt-exist").Apply(context.Background(), bundle)
-	require.Error(t, err, "no environments defined")
+	err := mutator.SelectTarget("doesnt-exist").Apply(context.Background(), bundle)
+	require.Error(t, err, "no targets defined")
 }
diff --git a/bundle/config/resources.go b/bundle/config/resources.go
index b15158b4..5d47b918 100644
--- a/bundle/config/resources.go
+++ b/bundle/config/resources.go
@@ -115,7 +115,7 @@ func (r *Resources) SetConfigFilePath(path string) {
 }
 
 // MergeJobClusters iterates over all jobs and merges their job clusters.
-// This is called after applying the environment overrides.
+// This is called after applying the target overrides.
 func (r *Resources) MergeJobClusters() error {
 	for _, job := range r.Jobs {
 		if err := job.MergeJobClusters(); err != nil {
diff --git a/bundle/config/resources/job.go b/bundle/config/resources/job.go
index 327d7e13..6200062a 100644
--- a/bundle/config/resources/job.go
+++ b/bundle/config/resources/job.go
@@ -22,7 +22,7 @@ func (j *Job) MergeJobClusters() error {
 	keys := make(map[string]*jobs.JobCluster)
 	output := make([]jobs.JobCluster, 0, len(j.JobClusters))
 
-	// Environment overrides are always appended, so we can iterate in natural order to
+	// Target overrides are always appended, so we can iterate in natural order to
 	// first find the base definition, and merge instances we encounter later.
 	for i := range j.JobClusters {
 		key := j.JobClusters[i].JobClusterKey
diff --git a/bundle/config/root.go b/bundle/config/root.go
index b6d1efc9..24426dd8 100644
--- a/bundle/config/root.go
+++ b/bundle/config/root.go
@@ -69,11 +69,14 @@ type Root struct {
 	// to deploy in this bundle (e.g. jobs, pipelines, etc.).
 	Resources Resources `json:"resources,omitempty"`
 
-	// Environments can be used to differentiate settings and resources between
-	// bundle deployment environments (e.g. development, staging, production).
+	// Targets can be used to differentiate settings and resources between
+	// bundle deployment targets (e.g. development, staging, production).
 	// If not specified, the code below initializes this field with a
-	// single default-initialized environment called "default".
-	Environments map[string]*Environment `json:"environments,omitempty"`
+	// single default-initialized target called "default".
+	Targets map[string]*Target `json:"targets,omitempty"`
+
+	// DEPRECATED. Left for backward compatibility with Targets
+	Environments map[string]*Target `json:"environments,omitempty"`
 }
 
 func Load(path string) (*Root, error) {
@@ -103,8 +106,8 @@ func Load(path string) (*Root, error) {
 // was loaded from in configuration leafs that require it.
 func (r *Root) SetConfigFilePath(path string) {
 	r.Resources.SetConfigFilePath(path)
-	if r.Environments != nil {
-		for _, env := range r.Environments {
+	if r.Targets != nil {
+		for _, env := range r.Targets {
 			if env == nil {
 				continue
 			}
@@ -148,6 +151,15 @@ func (r *Root) Load(path string) error {
 		return fmt.Errorf("failed to load %s: %w", path, err)
 	}
 
+	if r.Environments != nil && r.Targets != nil {
+		return fmt.Errorf("both 'environments' and 'targets' are specified, only 'targets' should be used: %s", path)
+	}
+
+	if r.Environments != nil {
+		//TODO: add a command line notice that this is a deprecated option.
+		r.Targets = r.Environments
+	}
+
 	r.Path = filepath.Dir(path)
 	r.SetConfigFilePath(path)
 
@@ -169,37 +181,37 @@ func (r *Root) Merge(other *Root) error {
 	return mergo.Merge(r, other, mergo.WithOverride)
 }
 
-func (r *Root) MergeEnvironment(env *Environment) error {
+func (r *Root) MergeTargetOverrides(target *Target) error {
 	var err error
 
-	// Environment may be nil if it's empty.
-	if env == nil {
+	// Target may be nil if it's empty.
+	if target == nil {
 		return nil
 	}
 
-	if env.Bundle != nil {
-		err = mergo.Merge(&r.Bundle, env.Bundle, mergo.WithOverride)
+	if target.Bundle != nil {
+		err = mergo.Merge(&r.Bundle, target.Bundle, mergo.WithOverride)
 		if err != nil {
 			return err
 		}
 	}
 
-	if env.Workspace != nil {
-		err = mergo.Merge(&r.Workspace, env.Workspace, mergo.WithOverride)
+	if target.Workspace != nil {
+		err = mergo.Merge(&r.Workspace, target.Workspace, mergo.WithOverride)
 		if err != nil {
 			return err
 		}
 	}
 
-	if env.Artifacts != nil {
-		err = mergo.Merge(&r.Artifacts, env.Artifacts, mergo.WithOverride, mergo.WithAppendSlice)
+	if target.Artifacts != nil {
+		err = mergo.Merge(&r.Artifacts, target.Artifacts, mergo.WithOverride, mergo.WithAppendSlice)
 		if err != nil {
 			return err
 		}
 	}
 
-	if env.Resources != nil {
-		err = mergo.Merge(&r.Resources, env.Resources, mergo.WithOverride, mergo.WithAppendSlice)
+	if target.Resources != nil {
+		err = mergo.Merge(&r.Resources, target.Resources, mergo.WithOverride, mergo.WithAppendSlice)
 		if err != nil {
 			return err
 		}
@@ -210,8 +222,8 @@ func (r *Root) MergeEnvironment(env *Environment) error {
 		}
 	}
 
-	if env.Variables != nil {
-		for k, v := range env.Variables {
+	if target.Variables != nil {
+		for k, v := range target.Variables {
 			variable, ok := r.Variables[k]
 			if !ok {
 				return fmt.Errorf("variable %s is not defined but is assigned a value", k)
@@ -222,24 +234,24 @@ func (r *Root) MergeEnvironment(env *Environment) error {
 		}
 	}
 
-	if env.Mode != "" {
-		r.Bundle.Mode = env.Mode
+	if target.Mode != "" {
+		r.Bundle.Mode = target.Mode
 	}
 
-	if env.ComputeID != "" {
-		r.Bundle.ComputeID = env.ComputeID
+	if target.ComputeID != "" {
+		r.Bundle.ComputeID = target.ComputeID
 	}
 
 	git := &r.Bundle.Git
-	if env.Git.Branch != "" {
-		git.Branch = env.Git.Branch
+	if target.Git.Branch != "" {
+		git.Branch = target.Git.Branch
 		git.Inferred = false
 	}
-	if env.Git.Commit != "" {
-		git.Commit = env.Git.Commit
+	if target.Git.Commit != "" {
+		git.Commit = target.Git.Commit
 	}
-	if env.Git.OriginURL != "" {
-		git.OriginURL = env.Git.OriginURL
+	if target.Git.OriginURL != "" {
+		git.OriginURL = target.Git.OriginURL
 	}
 
 	return nil
diff --git a/bundle/config/root_test.go b/bundle/config/root_test.go
index 531ffcec..6e263667 100644
--- a/bundle/config/root_test.go
+++ b/bundle/config/root_test.go
@@ -57,7 +57,7 @@ func TestRootMergeStruct(t *testing.T) {
 func TestRootMergeMap(t *testing.T) {
 	root := &Root{
 		Path: "path",
-		Environments: map[string]*Environment{
+		Targets: map[string]*Target{
 			"development": {
 				Workspace: &Workspace{
 					Host:    "foo",
@@ -68,7 +68,7 @@ func TestRootMergeMap(t *testing.T) {
 	}
 	other := &Root{
 		Path: "path",
-		Environments: map[string]*Environment{
+		Targets: map[string]*Target{
 			"development": {
 				Workspace: &Workspace{
 					Host: "bar",
@@ -77,7 +77,7 @@ func TestRootMergeMap(t *testing.T) {
 		},
 	}
 	assert.NoError(t, root.Merge(other))
-	assert.Equal(t, &Workspace{Host: "bar", Profile: "profile"}, root.Environments["development"].Workspace)
+	assert.Equal(t, &Workspace{Host: "bar", Profile: "profile"}, root.Targets["development"].Workspace)
 }
 
 func TestDuplicateIdOnLoadReturnsError(t *testing.T) {
@@ -159,12 +159,12 @@ func TestInitializeVariablesUndefinedVariables(t *testing.T) {
 	assert.ErrorContains(t, err, "variable bar has not been defined")
 }
 
-func TestRootMergeEnvironmentWithMode(t *testing.T) {
+func TestRootMergeTargetOverridesWithMode(t *testing.T) {
 	root := &Root{
 		Bundle: Bundle{},
 	}
-	env := &Environment{Mode: Development}
-	require.NoError(t, root.MergeEnvironment(env))
+	env := &Target{Mode: Development}
+	require.NoError(t, root.MergeTargetOverrides(env))
 	assert.Equal(t, Development, root.Bundle.Mode)
 }
 
diff --git a/bundle/config/environment.go b/bundle/config/target.go
similarity index 80%
rename from bundle/config/environment.go
rename to bundle/config/target.go
index 7152f791..10775049 100644
--- a/bundle/config/environment.go
+++ b/bundle/config/target.go
@@ -2,14 +2,14 @@ package config
 
 type Mode string
 
-// Environment defines overrides for a single environment.
+// Target defines overrides for a single target.
 // This structure is recursively merged into the root configuration.
-type Environment struct {
-	// Default marks that this environment must be used if one isn't specified
-	// by the user (through environment variable or command line argument).
+type Target struct {
+	// Default marks that this target must be used if one isn't specified
+	// by the user (through target variable or command line argument).
 	Default bool `json:"default,omitempty"`
 
-	// Determines the mode of the environment.
+	// Determines the mode of the target.
 	// For example, 'mode: development' can be used for deployments for
 	// development purposes.
 	Mode Mode `json:"mode,omitempty"`
@@ -27,7 +27,7 @@ type Environment struct {
 
 	// Override default values for defined variables
 	// Does not permit defining new variables or redefining existing ones
-	// in the scope of an environment
+	// in the scope of an target
 	Variables map[string]string `json:"variables,omitempty"`
 
 	Git Git `json:"git,omitempty"`
diff --git a/bundle/config/variable/variable.go b/bundle/config/variable/variable.go
index 132920bb..73925d43 100644
--- a/bundle/config/variable/variable.go
+++ b/bundle/config/variable/variable.go
@@ -18,7 +18,7 @@ type Variable struct {
 	// resolved in the following priority order (from highest to lowest)
 	//
 	// 1. Command line flag. For example: `--var="foo=bar"`
-	// 2. Environment variable. eg: BUNDLE_VAR_foo=bar
+	// 2. Target variable. eg: BUNDLE_VAR_foo=bar
 	// 3. Default value as defined in the applicable environments block
 	// 4. Default value defined in variable definition
 	// 5. Throw error, since if no default value is defined, then the variable
diff --git a/bundle/config/workspace.go b/bundle/config/workspace.go
index bd116a9c..90cd59c6 100644
--- a/bundle/config/workspace.go
+++ b/bundle/config/workspace.go
@@ -45,7 +45,7 @@ type Workspace struct {
 	CurrentUser *User `json:"current_user,omitempty" bundle:"readonly"`
 
 	// Remote workspace base path for deployment state, for artifacts, as synchronization target.
-	// This defaults to "~/.bundle/${bundle.name}/${bundle.environment}" where "~" expands to
+	// This defaults to "~/.bundle/${bundle.name}/${bundle.target}" where "~" expands to
 	// the current user's home directory in the workspace (e.g. `/Users/jane@doe.com`).
 	RootPath string `json:"root_path,omitempty"`
 
diff --git a/bundle/deploy/terraform/init_test.go b/bundle/deploy/terraform/init_test.go
index 79e18170..5bb5929e 100644
--- a/bundle/deploy/terraform/init_test.go
+++ b/bundle/deploy/terraform/init_test.go
@@ -31,7 +31,7 @@ func TestInitEnvironmentVariables(t *testing.T) {
 		Config: config.Root{
 			Path: t.TempDir(),
 			Bundle: config.Bundle{
-				Environment: "whatever",
+				Target: "whatever",
 				Terraform: &config.Terraform{
 					ExecPath: "terraform",
 				},
@@ -58,7 +58,7 @@ func TestSetTempDirEnvVarsForUnixWithTmpDirSet(t *testing.T) {
 		Config: config.Root{
 			Path: t.TempDir(),
 			Bundle: config.Bundle{
-				Environment: "whatever",
+				Target: "whatever",
 			},
 		},
 	}
@@ -86,7 +86,7 @@ func TestSetTempDirEnvVarsForUnixWithTmpDirNotSet(t *testing.T) {
 		Config: config.Root{
 			Path: t.TempDir(),
 			Bundle: config.Bundle{
-				Environment: "whatever",
+				Target: "whatever",
 			},
 		},
 	}
@@ -112,7 +112,7 @@ func TestSetTempDirEnvVarsForWindowWithAllTmpDirEnvVarsSet(t *testing.T) {
 		Config: config.Root{
 			Path: t.TempDir(),
 			Bundle: config.Bundle{
-				Environment: "whatever",
+				Target: "whatever",
 			},
 		},
 	}
@@ -142,7 +142,7 @@ func TestSetTempDirEnvVarsForWindowWithUserProfileAndTempSet(t *testing.T) {
 		Config: config.Root{
 			Path: t.TempDir(),
 			Bundle: config.Bundle{
-				Environment: "whatever",
+				Target: "whatever",
 			},
 		},
 	}
@@ -172,7 +172,7 @@ func TestSetTempDirEnvVarsForWindowWithUserProfileSet(t *testing.T) {
 		Config: config.Root{
 			Path: t.TempDir(),
 			Bundle: config.Bundle{
-				Environment: "whatever",
+				Target: "whatever",
 			},
 		},
 	}
@@ -202,7 +202,7 @@ func TestSetTempDirEnvVarsForWindowsWithoutAnyTempDirEnvVarsSet(t *testing.T) {
 		Config: config.Root{
 			Path: t.TempDir(),
 			Bundle: config.Bundle{
-				Environment: "whatever",
+				Target: "whatever",
 			},
 		},
 	}
@@ -230,7 +230,7 @@ func TestSetProxyEnvVars(t *testing.T) {
 		Config: config.Root{
 			Path: t.TempDir(),
 			Bundle: config.Bundle{
-				Environment: "whatever",
+				Target: "whatever",
 			},
 		},
 	}
diff --git a/bundle/deploy/terraform/load_test.go b/bundle/deploy/terraform/load_test.go
index c235c08e..1937ca8a 100644
--- a/bundle/deploy/terraform/load_test.go
+++ b/bundle/deploy/terraform/load_test.go
@@ -20,7 +20,7 @@ func TestLoadWithNoState(t *testing.T) {
 		Config: config.Root{
 			Path: t.TempDir(),
 			Bundle: config.Bundle{
-				Environment: "whatever",
+				Target: "whatever",
 				Terraform: &config.Terraform{
 					ExecPath: "terraform",
 				},
diff --git a/bundle/phases/initialize.go b/bundle/phases/initialize.go
index fc5056f6..219ec26c 100644
--- a/bundle/phases/initialize.go
+++ b/bundle/phases/initialize.go
@@ -26,7 +26,7 @@ func Initialize() bundle.Mutator {
 				interpolation.IncludeLookupsInPath(variable.VariableReferencePrefix),
 			),
 			mutator.OverrideCompute(),
-			mutator.ProcessEnvironmentMode(),
+			mutator.ProcessTargetMode(),
 			mutator.TranslatePaths(),
 			terraform.Initialize(),
 		},
diff --git a/bundle/schema/README.md b/bundle/schema/README.md
index 4df43cf2..fe6b149c 100644
--- a/bundle/schema/README.md
+++ b/bundle/schema/README.md
@@ -3,7 +3,7 @@
 `docs/bundle_descriptions.json` contains both autogenerated as well as manually written
 descriptions for the json schema. Specifically
 1. `resources` : almost all descriptions are autogenerated from the OpenAPI spec
-2. `environments` : almost all descriptions are copied over from root level entities (eg: `bundle`, `artifacts`)
+2. `targets` : almost all descriptions are copied over from root level entities (eg: `bundle`, `artifacts`)
 3. `bundle` : manually editted
 4. `include` : manually editted
 5. `workspace` : manually editted
@@ -17,7 +17,7 @@ These descriptions are rendered in the inline documentation in an IDE
 `databricks bundle schema --only-docs > ~/databricks/bundle/schema/docs/bundle_descriptions.json`
 2. Manually edit bundle_descriptions.json to add your descriptions
 3. Build again to embed the new `bundle_descriptions.json` into the binary (`go build`)
-4. Again run `databricks bundle schema --only-docs > ~/databricks/bundle/schema/docs/bundle_descriptions.json` to copy over any applicable descriptions to `environments`
+4. Again run `databricks bundle schema --only-docs > ~/databricks/bundle/schema/docs/bundle_descriptions.json` to copy over any applicable descriptions to `targets`
 5. push to repo
 
 
diff --git a/bundle/schema/docs.go b/bundle/schema/docs.go
index 5fcef4ed..4b2fd36a 100644
--- a/bundle/schema/docs.go
+++ b/bundle/schema/docs.go
@@ -52,20 +52,20 @@ func BundleDocs(openapiSpecPath string) (*Docs, error) {
 		}
 		docs.Properties["resources"] = schemaToDocs(resourceSchema)
 	}
-	docs.refreshEnvironmentsDocs()
+	docs.refreshTargetsDocs()
 	return docs, nil
 }
 
-func (docs *Docs) refreshEnvironmentsDocs() error {
-	environmentsDocs, ok := docs.Properties["environments"]
-	if !ok || environmentsDocs.AdditionalProperties == nil ||
-		environmentsDocs.AdditionalProperties.Properties == nil {
-		return fmt.Errorf("invalid environments descriptions")
+func (docs *Docs) refreshTargetsDocs() error {
+	targetsDocs, ok := docs.Properties["targets"]
+	if !ok || targetsDocs.AdditionalProperties == nil ||
+		targetsDocs.AdditionalProperties.Properties == nil {
+		return fmt.Errorf("invalid targets descriptions")
 	}
-	environmentProperties := environmentsDocs.AdditionalProperties.Properties
+	targetProperties := targetsDocs.AdditionalProperties.Properties
 	propertiesToCopy := []string{"artifacts", "bundle", "resources", "workspace"}
 	for _, p := range propertiesToCopy {
-		environmentProperties[p] = docs.Properties[p]
+		targetProperties[p] = docs.Properties[p]
 	}
 	return nil
 }
diff --git a/bundle/schema/docs/bundle_descriptions.json b/bundle/schema/docs/bundle_descriptions.json
index 2adb11f2..84f0492f 100644
--- a/bundle/schema/docs/bundle_descriptions.json
+++ b/bundle/schema/docs/bundle_descriptions.json
@@ -36,7 +36,7 @@
         }
       }
     },
-    "environments": {
+    "targets": {
       "description": "",
       "additionalproperties": {
         "description": "",
@@ -1827,7 +1827,7 @@
                 "description": "Connection profile to use. By default profiles are specified in ~/.databrickscfg."
               },
               "root_path": {
-                "description": "The base location for synchronizing files, artifacts and state. Defaults to `/Users/jane@doe.com/.bundle/${bundle.name}/${bundle.environment}`"
+                "description": "The base location for synchronizing files, artifacts and state. Defaults to `/Users/jane@doe.com/.bundle/${bundle.name}/${bundle.target}`"
               },
               "state_path": {
                 "description": "The remote path to synchronize bundle state to. This defaults to `${workspace.root}/state`"
@@ -3591,7 +3591,7 @@
           "description": "Connection profile to use. By default profiles are specified in ~/.databrickscfg."
         },
         "root_path": {
-          "description": "The base location for synchronizing files, artifacts and state. Defaults to `/Users/jane@doe.com/.bundle/${bundle.name}/${bundle.environment}`"
+          "description": "The base location for synchronizing files, artifacts and state. Defaults to `/Users/jane@doe.com/.bundle/${bundle.name}/${bundle.target}`"
         },
         "state_path": {
           "description": "The remote path to synchronize bundle state to. This defaults to `${workspace.root}/state`"
diff --git a/bundle/tests/autoload_git/databricks.yml b/bundle/tests/autoload_git/databricks.yml
index ba4785ae..92ab8d66 100644
--- a/bundle/tests/autoload_git/databricks.yml
+++ b/bundle/tests/autoload_git/databricks.yml
@@ -1,7 +1,7 @@
 bundle:
   name: autoload git config test
 
-environments:
+targets:
   development:
     default: true
 
diff --git a/bundle/tests/environment_empty/databricks.yml b/bundle/tests/environment_empty/databricks.yml
deleted file mode 100644
index 17c03c8d..00000000
--- a/bundle/tests/environment_empty/databricks.yml
+++ /dev/null
@@ -1,5 +0,0 @@
-bundle:
-  name: environment_empty
-
-environments:
-  development:
diff --git a/bundle/tests/environment_empty_test.go b/bundle/tests/environment_empty_test.go
deleted file mode 100644
index fb2e3341..00000000
--- a/bundle/tests/environment_empty_test.go
+++ /dev/null
@@ -1,12 +0,0 @@
-package config_tests
-
-import (
-	"testing"
-
-	"github.com/stretchr/testify/assert"
-)
-
-func TestEnvironmentEmpty(t *testing.T) {
-	b := loadEnvironment(t, "./environment_empty", "development")
-	assert.Equal(t, "development", b.Config.Bundle.Environment)
-}
diff --git a/bundle/tests/environment_git_test.go b/bundle/tests/environment_git_test.go
new file mode 100644
index 00000000..bb10825e
--- /dev/null
+++ b/bundle/tests/environment_git_test.go
@@ -0,0 +1,20 @@
+package config_tests
+
+import (
+	"testing"
+
+	"github.com/stretchr/testify/assert"
+)
+
+func TestGitAutoLoadWithEnvironment(t *testing.T) {
+	b := load(t, "./environments_autoload_git")
+	assert.True(t, b.Config.Bundle.Git.Inferred)
+	assert.Contains(t, b.Config.Bundle.Git.OriginURL, "/cli")
+}
+
+func TestGitManuallySetBranchWithEnvironment(t *testing.T) {
+	b := loadTarget(t, "./environments_autoload_git", "production")
+	assert.False(t, b.Config.Bundle.Git.Inferred)
+	assert.Equal(t, "main", b.Config.Bundle.Git.Branch)
+	assert.Contains(t, b.Config.Bundle.Git.OriginURL, "/cli")
+}
diff --git a/bundle/tests/environment_overrides_test.go b/bundle/tests/environment_overrides_test.go
index 0a3f9fcd..91dc2c81 100644
--- a/bundle/tests/environment_overrides_test.go
+++ b/bundle/tests/environment_overrides_test.go
@@ -7,17 +7,17 @@ import (
 )
 
 func TestEnvironmentOverridesWorkspaceDev(t *testing.T) {
-	b := loadEnvironment(t, "./environment_overrides/workspace", "development")
+	b := loadTarget(t, "./environment_overrides/workspace", "development")
 	assert.Equal(t, "https://development.acme.cloud.databricks.com/", b.Config.Workspace.Host)
 }
 
 func TestEnvironmentOverridesWorkspaceStaging(t *testing.T) {
-	b := loadEnvironment(t, "./environment_overrides/workspace", "staging")
+	b := loadTarget(t, "./environment_overrides/workspace", "staging")
 	assert.Equal(t, "https://staging.acme.cloud.databricks.com/", b.Config.Workspace.Host)
 }
 
 func TestEnvironmentOverridesResourcesDev(t *testing.T) {
-	b := loadEnvironment(t, "./environment_overrides/resources", "development")
+	b := loadTarget(t, "./environment_overrides/resources", "development")
 	assert.Equal(t, "base job", b.Config.Resources.Jobs["job1"].Name)
 
 	// Base values are preserved in the development environment.
@@ -26,7 +26,7 @@ func TestEnvironmentOverridesResourcesDev(t *testing.T) {
 }
 
 func TestEnvironmentOverridesResourcesStaging(t *testing.T) {
-	b := loadEnvironment(t, "./environment_overrides/resources", "staging")
+	b := loadTarget(t, "./environment_overrides/resources", "staging")
 	assert.Equal(t, "staging job", b.Config.Resources.Jobs["job1"].Name)
 
 	// Overrides are only applied if they are not zero-valued.
diff --git a/bundle/tests/environments_autoload_git/databricks.yml b/bundle/tests/environments_autoload_git/databricks.yml
new file mode 100644
index 00000000..ba4785ae
--- /dev/null
+++ b/bundle/tests/environments_autoload_git/databricks.yml
@@ -0,0 +1,11 @@
+bundle:
+  name: autoload git config test
+
+environments:
+  development:
+    default: true
+
+  production:
+    # production can only be deployed from the 'main' branch
+    git:
+      branch: main
diff --git a/bundle/tests/environments_job_and_pipeline/databricks.yml b/bundle/tests/environments_job_and_pipeline/databricks.yml
new file mode 100644
index 00000000..e29fa034
--- /dev/null
+++ b/bundle/tests/environments_job_and_pipeline/databricks.yml
@@ -0,0 +1,44 @@
+resources:
+  pipelines:
+    nyc_taxi_pipeline:
+      name: "nyc taxi loader"
+      libraries:
+        - notebook:
+            path: ./dlt/nyc_taxi_loader
+
+environments:
+  development:
+    mode: development
+    resources:
+      pipelines:
+        nyc_taxi_pipeline:
+          target: nyc_taxi_development
+          development: true
+
+  staging:
+    resources:
+      pipelines:
+        nyc_taxi_pipeline:
+          target: nyc_taxi_staging
+          development: false
+
+  production:
+    mode: production
+    resources:
+      pipelines:
+        nyc_taxi_pipeline:
+          target: nyc_taxi_production
+          development: false
+          photon: true
+
+      jobs:
+        pipeline_schedule:
+          name: Daily refresh of production pipeline
+
+          schedule:
+            quartz_cron_expression: 6 6 11 * * ?
+            timezone_id: UTC
+
+          tasks:
+            - pipeline_task:
+                pipeline_id: "to be interpolated"
diff --git a/bundle/tests/environments_job_and_pipeline_test.go b/bundle/tests/environments_job_and_pipeline_test.go
new file mode 100644
index 00000000..a18daf90
--- /dev/null
+++ b/bundle/tests/environments_job_and_pipeline_test.go
@@ -0,0 +1,56 @@
+package config_tests
+
+import (
+	"path/filepath"
+	"testing"
+
+	"github.com/databricks/cli/bundle/config"
+	"github.com/stretchr/testify/assert"
+	"github.com/stretchr/testify/require"
+)
+
+func TestJobAndPipelineDevelopmentWithEnvironment(t *testing.T) {
+	b := loadTarget(t, "./environments_job_and_pipeline", "development")
+	assert.Len(t, b.Config.Resources.Jobs, 0)
+	assert.Len(t, b.Config.Resources.Pipelines, 1)
+
+	p := b.Config.Resources.Pipelines["nyc_taxi_pipeline"]
+	assert.Equal(t, "environments_job_and_pipeline/databricks.yml", filepath.ToSlash(p.ConfigFilePath))
+	assert.Equal(t, b.Config.Bundle.Mode, config.Development)
+	assert.True(t, p.Development)
+	require.Len(t, p.Libraries, 1)
+	assert.Equal(t, "./dlt/nyc_taxi_loader", p.Libraries[0].Notebook.Path)
+	assert.Equal(t, "nyc_taxi_development", p.Target)
+}
+
+func TestJobAndPipelineStagingWithEnvironment(t *testing.T) {
+	b := loadTarget(t, "./environments_job_and_pipeline", "staging")
+	assert.Len(t, b.Config.Resources.Jobs, 0)
+	assert.Len(t, b.Config.Resources.Pipelines, 1)
+
+	p := b.Config.Resources.Pipelines["nyc_taxi_pipeline"]
+	assert.Equal(t, "environments_job_and_pipeline/databricks.yml", filepath.ToSlash(p.ConfigFilePath))
+	assert.False(t, p.Development)
+	require.Len(t, p.Libraries, 1)
+	assert.Equal(t, "./dlt/nyc_taxi_loader", p.Libraries[0].Notebook.Path)
+	assert.Equal(t, "nyc_taxi_staging", p.Target)
+}
+
+func TestJobAndPipelineProductionWithEnvironment(t *testing.T) {
+	b := loadTarget(t, "./environments_job_and_pipeline", "production")
+	assert.Len(t, b.Config.Resources.Jobs, 1)
+	assert.Len(t, b.Config.Resources.Pipelines, 1)
+
+	p := b.Config.Resources.Pipelines["nyc_taxi_pipeline"]
+	assert.Equal(t, "environments_job_and_pipeline/databricks.yml", filepath.ToSlash(p.ConfigFilePath))
+	assert.False(t, p.Development)
+	require.Len(t, p.Libraries, 1)
+	assert.Equal(t, "./dlt/nyc_taxi_loader", p.Libraries[0].Notebook.Path)
+	assert.Equal(t, "nyc_taxi_production", p.Target)
+
+	j := b.Config.Resources.Jobs["pipeline_schedule"]
+	assert.Equal(t, "environments_job_and_pipeline/databricks.yml", filepath.ToSlash(j.ConfigFilePath))
+	assert.Equal(t, "Daily refresh of production pipeline", j.Name)
+	require.Len(t, j.Tasks, 1)
+	assert.NotEmpty(t, j.Tasks[0].PipelineTask.PipelineId)
+}
diff --git a/bundle/tests/environments_override_job_cluster/databricks.yml b/bundle/tests/environments_override_job_cluster/databricks.yml
new file mode 100644
index 00000000..33061b2e
--- /dev/null
+++ b/bundle/tests/environments_override_job_cluster/databricks.yml
@@ -0,0 +1,35 @@
+bundle:
+  name: override_job_cluster
+
+workspace:
+  host: https://acme.cloud.databricks.com/
+
+resources:
+  jobs:
+    foo:
+      name: job
+      job_clusters:
+        - job_cluster_key: key
+          new_cluster:
+            spark_version: 13.3.x-scala2.12
+
+environments:
+  development:
+    resources:
+      jobs:
+        foo:
+          job_clusters:
+            - job_cluster_key: key
+              new_cluster:
+                node_type_id: i3.xlarge
+                num_workers: 1
+
+  staging:
+    resources:
+      jobs:
+        foo:
+          job_clusters:
+            - job_cluster_key: key
+              new_cluster:
+                node_type_id: i3.2xlarge
+                num_workers: 4
diff --git a/bundle/tests/environments_override_job_cluster_test.go b/bundle/tests/environments_override_job_cluster_test.go
new file mode 100644
index 00000000..b3ec7445
--- /dev/null
+++ b/bundle/tests/environments_override_job_cluster_test.go
@@ -0,0 +1,29 @@
+package config_tests
+
+import (
+	"testing"
+
+	"github.com/stretchr/testify/assert"
+)
+
+func TestOverrideJobClusterDevWithEnvironment(t *testing.T) {
+	b := loadTarget(t, "./environments_override_job_cluster", "development")
+	assert.Equal(t, "job", b.Config.Resources.Jobs["foo"].Name)
+	assert.Len(t, b.Config.Resources.Jobs["foo"].JobClusters, 1)
+
+	c := b.Config.Resources.Jobs["foo"].JobClusters[0]
+	assert.Equal(t, "13.3.x-scala2.12", c.NewCluster.SparkVersion)
+	assert.Equal(t, "i3.xlarge", c.NewCluster.NodeTypeId)
+	assert.Equal(t, 1, c.NewCluster.NumWorkers)
+}
+
+func TestOverrideJobClusterStagingWithEnvironment(t *testing.T) {
+	b := loadTarget(t, "./environments_override_job_cluster", "staging")
+	assert.Equal(t, "job", b.Config.Resources.Jobs["foo"].Name)
+	assert.Len(t, b.Config.Resources.Jobs["foo"].JobClusters, 1)
+
+	c := b.Config.Resources.Jobs["foo"].JobClusters[0]
+	assert.Equal(t, "13.3.x-scala2.12", c.NewCluster.SparkVersion)
+	assert.Equal(t, "i3.2xlarge", c.NewCluster.NodeTypeId)
+	assert.Equal(t, 4, c.NewCluster.NumWorkers)
+}
diff --git a/bundle/tests/git_test.go b/bundle/tests/git_test.go
index daab4d30..c5ae83a2 100644
--- a/bundle/tests/git_test.go
+++ b/bundle/tests/git_test.go
@@ -17,7 +17,7 @@ func TestGitAutoLoad(t *testing.T) {
 }
 
 func TestGitManuallySetBranch(t *testing.T) {
-	b := loadEnvironment(t, "./autoload_git", "production")
+	b := loadTarget(t, "./autoload_git", "production")
 	assert.False(t, b.Config.Bundle.Git.Inferred)
 	assert.Equal(t, "main", b.Config.Bundle.Git.Branch)
 	assert.Contains(t, b.Config.Bundle.Git.OriginURL, "/cli")
diff --git a/bundle/tests/interpolation_target/databricks.yml b/bundle/tests/interpolation_target/databricks.yml
new file mode 100644
index 00000000..ad4ebe19
--- /dev/null
+++ b/bundle/tests/interpolation_target/databricks.yml
@@ -0,0 +1,14 @@
+bundle:
+  name: foo ${workspace.profile}
+
+workspace:
+  profile: bar
+
+targets:
+  development:
+    default: true
+
+resources:
+  jobs:
+    my_job:
+      name: "${bundle.name} | ${workspace.profile} | ${bundle.environment} | ${bundle.target}"
diff --git a/bundle/tests/interpolation_test.go b/bundle/tests/interpolation_test.go
index 47b0c775..837891a0 100644
--- a/bundle/tests/interpolation_test.go
+++ b/bundle/tests/interpolation_test.go
@@ -20,3 +20,15 @@ func TestInterpolation(t *testing.T) {
 	assert.Equal(t, "foo bar", b.Config.Bundle.Name)
 	assert.Equal(t, "foo bar | bar", b.Config.Resources.Jobs["my_job"].Name)
 }
+
+func TestInterpolationWithTarget(t *testing.T) {
+	b := loadTarget(t, "./interpolation_target", "development")
+	err := bundle.Apply(context.Background(), b, interpolation.Interpolate(
+		interpolation.IncludeLookupsInPath("bundle"),
+		interpolation.IncludeLookupsInPath("workspace"),
+	))
+	require.NoError(t, err)
+	assert.Equal(t, "foo bar", b.Config.Bundle.Name)
+	assert.Equal(t, "foo bar | bar | development | development", b.Config.Resources.Jobs["my_job"].Name)
+
+}
diff --git a/bundle/tests/job_and_pipeline/databricks.yml b/bundle/tests/job_and_pipeline/databricks.yml
index e29fa034..67d306ff 100644
--- a/bundle/tests/job_and_pipeline/databricks.yml
+++ b/bundle/tests/job_and_pipeline/databricks.yml
@@ -6,7 +6,7 @@ resources:
         - notebook:
             path: ./dlt/nyc_taxi_loader
 
-environments:
+targets:
   development:
     mode: development
     resources:
diff --git a/bundle/tests/job_and_pipeline_test.go b/bundle/tests/job_and_pipeline_test.go
index d92eabd3..5e8febc3 100644
--- a/bundle/tests/job_and_pipeline_test.go
+++ b/bundle/tests/job_and_pipeline_test.go
@@ -10,7 +10,7 @@ import (
 )
 
 func TestJobAndPipelineDevelopment(t *testing.T) {
-	b := loadEnvironment(t, "./job_and_pipeline", "development")
+	b := loadTarget(t, "./job_and_pipeline", "development")
 	assert.Len(t, b.Config.Resources.Jobs, 0)
 	assert.Len(t, b.Config.Resources.Pipelines, 1)
 
@@ -24,7 +24,7 @@ func TestJobAndPipelineDevelopment(t *testing.T) {
 }
 
 func TestJobAndPipelineStaging(t *testing.T) {
-	b := loadEnvironment(t, "./job_and_pipeline", "staging")
+	b := loadTarget(t, "./job_and_pipeline", "staging")
 	assert.Len(t, b.Config.Resources.Jobs, 0)
 	assert.Len(t, b.Config.Resources.Pipelines, 1)
 
@@ -37,7 +37,7 @@ func TestJobAndPipelineStaging(t *testing.T) {
 }
 
 func TestJobAndPipelineProduction(t *testing.T) {
-	b := loadEnvironment(t, "./job_and_pipeline", "production")
+	b := loadTarget(t, "./job_and_pipeline", "production")
 	assert.Len(t, b.Config.Resources.Jobs, 1)
 	assert.Len(t, b.Config.Resources.Pipelines, 1)
 
diff --git a/bundle/tests/loader.go b/bundle/tests/loader.go
index 056a82d9..f23b1076 100644
--- a/bundle/tests/loader.go
+++ b/bundle/tests/loader.go
@@ -18,9 +18,9 @@ func load(t *testing.T, path string) *bundle.Bundle {
 	return b
 }
 
-func loadEnvironment(t *testing.T, path, env string) *bundle.Bundle {
+func loadTarget(t *testing.T, path, env string) *bundle.Bundle {
 	b := load(t, path)
-	err := bundle.Apply(context.Background(), b, mutator.SelectEnvironment(env))
+	err := bundle.Apply(context.Background(), b, mutator.SelectTarget(env))
 	require.NoError(t, err)
 	return b
 }
diff --git a/bundle/tests/override_job_cluster/databricks.yml b/bundle/tests/override_job_cluster/databricks.yml
index 33061b2e..a85b3b71 100644
--- a/bundle/tests/override_job_cluster/databricks.yml
+++ b/bundle/tests/override_job_cluster/databricks.yml
@@ -13,7 +13,7 @@ resources:
           new_cluster:
             spark_version: 13.3.x-scala2.12
 
-environments:
+targets:
   development:
     resources:
       jobs:
diff --git a/bundle/tests/override_job_cluster_test.go b/bundle/tests/override_job_cluster_test.go
index 97f7c04e..1393e03e 100644
--- a/bundle/tests/override_job_cluster_test.go
+++ b/bundle/tests/override_job_cluster_test.go
@@ -7,7 +7,7 @@ import (
 )
 
 func TestOverrideJobClusterDev(t *testing.T) {
-	b := loadEnvironment(t, "./override_job_cluster", "development")
+	b := loadTarget(t, "./override_job_cluster", "development")
 	assert.Equal(t, "job", b.Config.Resources.Jobs["foo"].Name)
 	assert.Len(t, b.Config.Resources.Jobs["foo"].JobClusters, 1)
 
@@ -18,7 +18,7 @@ func TestOverrideJobClusterDev(t *testing.T) {
 }
 
 func TestOverrideJobClusterStaging(t *testing.T) {
-	b := loadEnvironment(t, "./override_job_cluster", "staging")
+	b := loadTarget(t, "./override_job_cluster", "staging")
 	assert.Equal(t, "job", b.Config.Resources.Jobs["foo"].Name)
 	assert.Len(t, b.Config.Resources.Jobs["foo"].JobClusters, 1)
 
diff --git a/bundle/tests/target_empty/databricks.yml b/bundle/tests/target_empty/databricks.yml
new file mode 100644
index 00000000..cd415377
--- /dev/null
+++ b/bundle/tests/target_empty/databricks.yml
@@ -0,0 +1,5 @@
+bundle:
+  name: target_empty
+
+targets:
+  development:
diff --git a/bundle/tests/target_empty_test.go b/bundle/tests/target_empty_test.go
new file mode 100644
index 00000000..88705d8b
--- /dev/null
+++ b/bundle/tests/target_empty_test.go
@@ -0,0 +1,12 @@
+package config_tests
+
+import (
+	"testing"
+
+	"github.com/stretchr/testify/assert"
+)
+
+func TestTargetEmpty(t *testing.T) {
+	b := loadTarget(t, "./target_empty", "development")
+	assert.Equal(t, "development", b.Config.Bundle.Target)
+}
diff --git a/bundle/tests/target_overrides/resources/databricks.yml b/bundle/tests/target_overrides/resources/databricks.yml
new file mode 100644
index 00000000..f6e2a7ed
--- /dev/null
+++ b/bundle/tests/target_overrides/resources/databricks.yml
@@ -0,0 +1,20 @@
+bundle:
+  name: environment_overrides
+
+workspace:
+  host: https://acme.cloud.databricks.com/
+
+resources:
+  jobs:
+    job1:
+      name: "base job"
+
+targets:
+  development:
+    default: true
+
+  staging:
+    resources:
+      jobs:
+        job1:
+          name: "staging job"
diff --git a/bundle/tests/target_overrides/workspace/databricks.yml b/bundle/tests/target_overrides/workspace/databricks.yml
new file mode 100644
index 00000000..8c4f9487
--- /dev/null
+++ b/bundle/tests/target_overrides/workspace/databricks.yml
@@ -0,0 +1,14 @@
+bundle:
+  name: environment_overrides
+
+workspace:
+  host: https://acme.cloud.databricks.com/
+
+targets:
+  development:
+    workspace:
+      host: https://development.acme.cloud.databricks.com/
+
+  staging:
+    workspace:
+      host: https://staging.acme.cloud.databricks.com/
diff --git a/bundle/tests/target_overrides_test.go b/bundle/tests/target_overrides_test.go
new file mode 100644
index 00000000..2516ce2a
--- /dev/null
+++ b/bundle/tests/target_overrides_test.go
@@ -0,0 +1,27 @@
+package config_tests
+
+import (
+	"testing"
+
+	"github.com/stretchr/testify/assert"
+)
+
+func TestTargetOverridesWorkspaceDev(t *testing.T) {
+	b := loadTarget(t, "./target_overrides/workspace", "development")
+	assert.Equal(t, "https://development.acme.cloud.databricks.com/", b.Config.Workspace.Host)
+}
+
+func TestTargetOverridesWorkspaceStaging(t *testing.T) {
+	b := loadTarget(t, "./target_overrides/workspace", "staging")
+	assert.Equal(t, "https://staging.acme.cloud.databricks.com/", b.Config.Workspace.Host)
+}
+
+func TestTargetOverridesResourcesDev(t *testing.T) {
+	b := loadTarget(t, "./target_overrides/resources", "development")
+	assert.Equal(t, "base job", b.Config.Resources.Jobs["job1"].Name)
+}
+
+func TestTargetOverridesResourcesStaging(t *testing.T) {
+	b := loadTarget(t, "./target_overrides/resources", "staging")
+	assert.Equal(t, "staging job", b.Config.Resources.Jobs["job1"].Name)
+}
diff --git a/bundle/tests/variables/env_overrides/databricks.yml b/bundle/tests/variables/env_overrides/databricks.yml
index 1fec1073..2157596c 100644
--- a/bundle/tests/variables/env_overrides/databricks.yml
+++ b/bundle/tests/variables/env_overrides/databricks.yml
@@ -12,7 +12,7 @@ bundle:
 workspace:
   profile: ${var.a} ${var.b}
 
-environments:
+targets:
   env-with-single-variable-override:
     variables:
       b: dev-b
diff --git a/bundle/tests/variables_test.go b/bundle/tests/variables_test.go
index 365ffbd4..93c82250 100644
--- a/bundle/tests/variables_test.go
+++ b/bundle/tests/variables_test.go
@@ -34,10 +34,10 @@ func TestVariablesLoadingFailsWhenRequiredVariableIsNotSpecified(t *testing.T) {
 	assert.ErrorContains(t, err, "no value assigned to required variable b. Assignment can be done through the \"--var\" flag or by setting the BUNDLE_VAR_b environment variable")
 }
 
-func TestVariablesEnvironmentsBlockOverride(t *testing.T) {
+func TestVariablesTargetsBlockOverride(t *testing.T) {
 	b := load(t, "./variables/env_overrides")
 	err := bundle.Apply(context.Background(), b, bundle.Seq(
-		mutator.SelectEnvironment("env-with-single-variable-override"),
+		mutator.SelectTarget("env-with-single-variable-override"),
 		mutator.SetVariables(),
 		interpolation.Interpolate(
 			interpolation.IncludeLookupsInPath(variable.VariableReferencePrefix),
@@ -46,10 +46,10 @@ func TestVariablesEnvironmentsBlockOverride(t *testing.T) {
 	assert.Equal(t, "default-a dev-b", b.Config.Workspace.Profile)
 }
 
-func TestVariablesEnvironmentsBlockOverrideForMultipleVariables(t *testing.T) {
+func TestVariablesTargetsBlockOverrideForMultipleVariables(t *testing.T) {
 	b := load(t, "./variables/env_overrides")
 	err := bundle.Apply(context.Background(), b, bundle.Seq(
-		mutator.SelectEnvironment("env-with-two-variable-overrides"),
+		mutator.SelectTarget("env-with-two-variable-overrides"),
 		mutator.SetVariables(),
 		interpolation.Interpolate(
 			interpolation.IncludeLookupsInPath(variable.VariableReferencePrefix),
@@ -58,11 +58,11 @@ func TestVariablesEnvironmentsBlockOverrideForMultipleVariables(t *testing.T) {
 	assert.Equal(t, "prod-a prod-b", b.Config.Workspace.Profile)
 }
 
-func TestVariablesEnvironmentsBlockOverrideWithProcessEnvVars(t *testing.T) {
+func TestVariablesTargetsBlockOverrideWithProcessEnvVars(t *testing.T) {
 	t.Setenv("BUNDLE_VAR_b", "env-var-b")
 	b := load(t, "./variables/env_overrides")
 	err := bundle.Apply(context.Background(), b, bundle.Seq(
-		mutator.SelectEnvironment("env-with-two-variable-overrides"),
+		mutator.SelectTarget("env-with-two-variable-overrides"),
 		mutator.SetVariables(),
 		interpolation.Interpolate(
 			interpolation.IncludeLookupsInPath(variable.VariableReferencePrefix),
@@ -71,10 +71,10 @@ func TestVariablesEnvironmentsBlockOverrideWithProcessEnvVars(t *testing.T) {
 	assert.Equal(t, "prod-a env-var-b", b.Config.Workspace.Profile)
 }
 
-func TestVariablesEnvironmentsBlockOverrideWithMissingVariables(t *testing.T) {
+func TestVariablesTargetsBlockOverrideWithMissingVariables(t *testing.T) {
 	b := load(t, "./variables/env_overrides")
 	err := bundle.Apply(context.Background(), b, bundle.Seq(
-		mutator.SelectEnvironment("env-missing-a-required-variable-assignment"),
+		mutator.SelectTarget("env-missing-a-required-variable-assignment"),
 		mutator.SetVariables(),
 		interpolation.Interpolate(
 			interpolation.IncludeLookupsInPath(variable.VariableReferencePrefix),
@@ -82,10 +82,10 @@ func TestVariablesEnvironmentsBlockOverrideWithMissingVariables(t *testing.T) {
 	assert.ErrorContains(t, err, "no value assigned to required variable b. Assignment can be done through the \"--var\" flag or by setting the BUNDLE_VAR_b environment variable")
 }
 
-func TestVariablesEnvironmentsBlockOverrideWithUndefinedVariables(t *testing.T) {
+func TestVariablesTargetsBlockOverrideWithUndefinedVariables(t *testing.T) {
 	b := load(t, "./variables/env_overrides")
 	err := bundle.Apply(context.Background(), b, bundle.Seq(
-		mutator.SelectEnvironment("env-using-an-undefined-variable"),
+		mutator.SelectTarget("env-using-an-undefined-variable"),
 		mutator.SetVariables(),
 		interpolation.Interpolate(
 			interpolation.IncludeLookupsInPath(variable.VariableReferencePrefix),
diff --git a/cmd/bundle/variables.go b/cmd/bundle/variables.go
index 33f557cc..c3e4af64 100644
--- a/cmd/bundle/variables.go
+++ b/cmd/bundle/variables.go
@@ -7,7 +7,7 @@ import (
 )
 
 func ConfigureBundleWithVariables(cmd *cobra.Command, args []string) error {
-	// Load bundle config and apply environment
+	// Load bundle config and apply target
 	err := root.MustConfigureBundle(cmd, args)
 	if err != nil {
 		return err
diff --git a/cmd/configure/configure.go b/cmd/configure/configure.go
index c51fd830..0c1e4052 100644
--- a/cmd/configure/configure.go
+++ b/cmd/configure/configure.go
@@ -131,7 +131,7 @@ func newConfigureCommand() *cobra.Command {
 
 	// Include token flag for compatibility with the legacy CLI.
 	// It doesn't actually do anything because we always use PATs.
-	cmd.Flags().BoolP("token", "t", true, "Configure using Databricks Personal Access Token")
+	cmd.Flags().Bool("token", true, "Configure using Databricks Personal Access Token")
 	cmd.Flags().MarkHidden("token")
 
 	cmd.RunE = func(cmd *cobra.Command, args []string) error {
diff --git a/cmd/root/bundle.go b/cmd/root/bundle.go
index f691bbfc..e1c12336 100644
--- a/cmd/root/bundle.go
+++ b/cmd/root/bundle.go
@@ -11,11 +11,12 @@ import (
 )
 
 const envName = "DATABRICKS_BUNDLE_ENV"
+const targetName = "DATABRICKS_BUNDLE_TARGET"
 
-// getEnvironment returns the name of the environment to operate in.
-func getEnvironment(cmd *cobra.Command) (value string) {
+// getTarget returns the name of the target to operate in.
+func getTarget(cmd *cobra.Command) (value string) {
 	// The command line flag takes precedence.
-	flag := cmd.Flag("environment")
+	flag := cmd.Flag("target")
 	if flag != nil {
 		value = flag.Value.String()
 		if value != "" {
@@ -23,8 +24,23 @@ func getEnvironment(cmd *cobra.Command) (value string) {
 		}
 	}
 
+	oldFlag := cmd.Flag("environment")
+	if oldFlag != nil {
+		value = flag.Value.String()
+		if value != "" {
+			return
+		}
+	}
+
 	// If it's not set, use the environment variable.
-	return os.Getenv(envName)
+	target := os.Getenv(targetName)
+	// If target env is not set with a new variable, try to check for old variable name
+	// TODO: remove when environments section is not supported anymore
+	if target == "" {
+		target = os.Getenv(envName)
+	}
+
+	return target
 }
 
 func getProfile(cmd *cobra.Command) (value string) {
@@ -80,11 +96,11 @@ func configureBundle(cmd *cobra.Command, args []string, load func(ctx context.Co
 	}
 
 	var m bundle.Mutator
-	env := getEnvironment(cmd)
+	env := getTarget(cmd)
 	if env == "" {
-		m = mutator.SelectDefaultEnvironment()
+		m = mutator.SelectDefaultTarget()
 	} else {
-		m = mutator.SelectEnvironment(env)
+		m = mutator.SelectTarget(env)
 	}
 
 	ctx := cmd.Context()
@@ -108,19 +124,27 @@ func TryConfigureBundle(cmd *cobra.Command, args []string) error {
 	return configureBundle(cmd, args, bundle.TryLoad)
 }
 
-// environmentCompletion executes to autocomplete the argument to the environment flag.
-func environmentCompletion(cmd *cobra.Command, args []string, toComplete string) ([]string, cobra.ShellCompDirective) {
+// targetCompletion executes to autocomplete the argument to the target flag.
+func targetCompletion(cmd *cobra.Command, args []string, toComplete string) ([]string, cobra.ShellCompDirective) {
 	b, err := loadBundle(cmd, args, bundle.MustLoad)
 	if err != nil {
 		cobra.CompErrorln(err.Error())
 		return nil, cobra.ShellCompDirectiveError
 	}
 
-	return maps.Keys(b.Config.Environments), cobra.ShellCompDirectiveDefault
+	return maps.Keys(b.Config.Targets), cobra.ShellCompDirectiveDefault
 }
 
+func initTargetFlag(cmd *cobra.Command) {
+	// To operate in the context of a bundle, all commands must take an "target" parameter.
+	cmd.PersistentFlags().StringP("target", "t", "", "bundle target to use (if applicable)")
+	cmd.RegisterFlagCompletionFunc("target", targetCompletion)
+}
+
+// DEPRECATED flag
 func initEnvironmentFlag(cmd *cobra.Command) {
 	// To operate in the context of a bundle, all commands must take an "environment" parameter.
-	cmd.PersistentFlags().StringP("environment", "e", "", "bundle environment to use (if applicable)")
-	cmd.RegisterFlagCompletionFunc("environment", environmentCompletion)
+	cmd.PersistentFlags().StringP("environment", "e", "", "bundle target to use (if applicable)")
+	cmd.PersistentFlags().MarkDeprecated("environment", "use --target flag instead")
+	cmd.RegisterFlagCompletionFunc("environment", targetCompletion)
 }
diff --git a/cmd/root/bundle_test.go b/cmd/root/bundle_test.go
index 4382cf22..8aff9018 100644
--- a/cmd/root/bundle_test.go
+++ b/cmd/root/bundle_test.go
@@ -128,3 +128,27 @@ func TestBundleConfigureWithProfileFlagAndEnvVariable(t *testing.T) {
 		b.WorkspaceClient()
 	})
 }
+
+func TestTargetFlagFull(t *testing.T) {
+	cmd := emptyCommand(t)
+	initTargetFlag(cmd)
+	cmd.SetArgs([]string{"version", "--target", "development"})
+
+	ctx := context.Background()
+	err := cmd.ExecuteContext(ctx)
+	assert.NoError(t, err)
+
+	assert.Equal(t, cmd.Flag("target").Value.String(), "development")
+}
+
+func TestTargetFlagShort(t *testing.T) {
+	cmd := emptyCommand(t)
+	initTargetFlag(cmd)
+	cmd.SetArgs([]string{"version", "-t", "production"})
+
+	ctx := context.Background()
+	err := cmd.ExecuteContext(ctx)
+	assert.NoError(t, err)
+
+	assert.Equal(t, cmd.Flag("target").Value.String(), "production")
+}
diff --git a/cmd/root/root.go b/cmd/root/root.go
index 48868b41..c71cf9ea 100644
--- a/cmd/root/root.go
+++ b/cmd/root/root.go
@@ -36,6 +36,7 @@ func New() *cobra.Command {
 	outputFlag := initOutputFlag(cmd)
 	initProfileFlag(cmd)
 	initEnvironmentFlag(cmd)
+	initTargetFlag(cmd)
 
 	cmd.PersistentPreRunE = func(cmd *cobra.Command, args []string) error {
 		ctx := cmd.Context()
diff --git a/cmd/sync/sync_test.go b/cmd/sync/sync_test.go
index a6eedbe6..06e97540 100644
--- a/cmd/sync/sync_test.go
+++ b/cmd/sync/sync_test.go
@@ -18,7 +18,7 @@ func TestSyncOptionsFromBundle(t *testing.T) {
 			Path: tempDir,
 
 			Bundle: config.Bundle{
-				Environment: "default",
+				Target: "default",
 			},
 
 			Workspace: config.Workspace{