diff --git a/Makefile.am b/Makefile.am
index a08215ef1e..84f8eb1b63 100644
--- a/Makefile.am
+++ b/Makefile.am
@@ -259,6 +259,7 @@ endif BUILD_DAEMON
 ACLOCAL_AMFLAGS = -I m4
 AM_DISTCHECK_CONFIGURE_FLAGS =			\
   --with-libgcrypt-prefix="$(LIBGCRYPT_PREFIX)"	\
+  --with-libgcrypt-libdir="$(LIBGCRYPT_LIBDIR)"	\
   --with-nix-prefix="$(NIX_PREFIX)"		\
   --enable-daemon
 
diff --git a/config-daemon.ac b/config-daemon.ac
index 08a72a0c4c..a13525a7f5 100644
--- a/config-daemon.ac
+++ b/config-daemon.ac
@@ -38,13 +38,21 @@ if test "x$guix_build_daemon" = "xyes"; then
   case "$LIBGCRYPT_PREFIX" in
     no)
       LIBGCRYPT_CFLAGS=""
-      LIBGCRYPT_LIBS=""
       ;;
     *)
       LIBGCRYPT_CFLAGS="-I$LIBGCRYPT_PREFIX/include"
-      LIBGCRYPT_LIBS="-L$LIBGCRYPT_PREFIX/lib -lgcrypt"
       ;;
   esac
+
+  case "$LIBGCRYPT_LIBDIR" in
+    no)
+      LIBGCRYPT_LIBS="-lgcrypt"
+      ;;
+   *)
+      LIBGCRYPT_LIBS="-L$LIBGCRYPT_LIBDIR -lgcrypt"
+      ;;
+  esac
+
   AC_SUBST([LIBGCRYPT_CFLAGS])
   AC_SUBST([LIBGCRYPT_LIBS])
 
diff --git a/configure.ac b/configure.ac
index 05e0370e6b..7b2a0e4dd5 100644
--- a/configure.ac
+++ b/configure.ac
@@ -116,19 +116,39 @@ AC_ARG_WITH([libgcrypt-prefix],
     yes|no)
       LIBGCRYPT="libgcrypt"
       LIBGCRYPT_PREFIX="no"
+      LIBGCRYPT_LIBDIR="no"
       ;;
     *)
       LIBGCRYPT="$withval/lib/libgcrypt"
       LIBGCRYPT_PREFIX="$withval"
+      LIBGCRYPT_LIBDIR="$withval/lib"
       ;;
    esac],
   [LIBGCRYPT="libgcrypt"])
 
+AC_ARG_WITH([libgcrypt-libdir],
+  [AS_HELP_STRING([--with-libgcrypt-libdir=DIR],
+     [search for GNU libgcrypt's shared library in DIR])],
+  [case "$withval" in
+    yes|no)
+      LIBGCRYPT="libgcrypt"
+      LIBGCRYPT_LIBDIR="no"
+      ;;
+    *)
+      LIBGCRYPT="$withval/libgcrypt"
+      LIBGCRYPT_LIBDIR="$withval"
+      ;;
+   esac],
+  [if test "x$LIBGCRYPT" = x; then
+      LIBGCRYPT="libgcrypt"
+   fi])
+
 dnl Library name suitable for `dynamic-link'.
 AC_MSG_CHECKING([for libgcrypt shared library name])
 AC_MSG_RESULT([$LIBGCRYPT])
 AC_SUBST([LIBGCRYPT])
 AC_SUBST([LIBGCRYPT_PREFIX])
+AC_SUBST([LIBGCRYPT_LIBDIR])
 
 GUIX_ASSERT_LIBGCRYPT_USABLE