diff --git a/docs/parameter_reference.md b/docs/parameter_reference.md
index ad668f4..947b86c 100644
--- a/docs/parameter_reference.md
+++ b/docs/parameter_reference.md
@@ -62,7 +62,9 @@ Uninstallations are triggered when the `helm_command` setting is "uninstall" or
 
 ### Where to put settings
 
-Any setting can go in either the `settings` or `environment` section.
+Any setting can go in either the `settings` or `environment` section. If a setting exists in _both_ sections, the version in `environment` will override the version in `settings`.
+
+We recommend putting all drone-helm3 configuration in the `settings` block and limiting the `environment` block to variables that are used when building your charts.
 
 ### Formatting non-string values