diff --git a/pkg/configfilearg/parser.go b/pkg/configfilearg/parser.go
index 077b89922b98..c17a8f184ae7 100644
--- a/pkg/configfilearg/parser.go
+++ b/pkg/configfilearg/parser.go
@@ -42,12 +42,12 @@ func (p *Parser) Parse(args []string) ([]string, error) {
 		return args, nil
 	}
 
-	configFile, isSet := p.findConfigFileFlag(args)
-	if configFile != "" {
+	if configFile := p.findConfigFileFlag(args); configFile != "" {
 		values, err := readConfigFile(configFile)
-		if !isSet && os.IsNotExist(err) {
-			return args, nil
-		} else if err != nil {
+		if err != nil {
+			if os.IsNotExist(err) {
+				return args, nil
+			}
 			return nil, err
 		}
 		if len(args) > 1 {
@@ -99,49 +99,50 @@ func (p *Parser) stripInvalidFlags(command string, args []string) ([]string, err
 	return result, nil
 }
 
+// FindString returns the string value of a flag, checking the CLI args,
+// config file, and config file dropins. If the value is not found,
+// an empty string is returned. It is not an error if no args,
+// configfile, or dropins are present.
 func (p *Parser) FindString(args []string, target string) (string, error) {
-
 	// Check for --help or --version flags, which override any other flags
 	if val, found := p.findOverrideFlag(args); found {
 		return val, nil
 	}
 
-	configFile, isSet := p.findConfigFileFlag(args)
+	var files []string
 	var lastVal string
-	if configFile != "" {
 
-		_, err := os.Stat(configFile)
-		if !isSet && os.IsNotExist(err) {
-			return "", nil
-		} else if err != nil {
+	if configFile := p.findConfigFileFlag(args); configFile != "" {
+		if _, err := os.Stat(configFile); err == nil {
+			files = append(files, configFile)
+		}
+
+		dropinFiles, err := dotDFiles(configFile)
+		if err != nil {
 			return "", err
 		}
+		files = append(files, dropinFiles...)
+	}
 
-		files, err := dotDFiles(configFile)
+	for _, file := range files {
+		bytes, err := readConfigFileData(file)
 		if err != nil {
 			return "", err
 		}
-		files = append([]string{configFile}, files...)
-		for _, file := range files {
-			bytes, err := readConfigFileData(file)
-			if err != nil {
-				return "", err
-			}
 
-			data := yaml.MapSlice{}
-			if err := yaml.Unmarshal(bytes, &data); err != nil {
-				return "", err
-			}
-			for _, i := range data {
-				k, v := convert.ToString(i.Key), convert.ToString(i.Value)
-				isAppend := strings.HasSuffix(k, "+")
-				k = strings.TrimSuffix(k, "+")
-				if k == target {
-					if isAppend {
-						lastVal = lastVal + "," + v
-					} else {
-						lastVal = v
-					}
+		data := yaml.MapSlice{}
+		if err := yaml.Unmarshal(bytes, &data); err != nil {
+			return "", err
+		}
+		for _, i := range data {
+			k, v := convert.ToString(i.Key), convert.ToString(i.Value)
+			isAppend := strings.HasSuffix(k, "+")
+			k = strings.TrimSuffix(k, "+")
+			if k == target {
+				if isAppend {
+					lastVal = lastVal + "," + v
+				} else {
+					lastVal = v
 				}
 			}
 		}
@@ -161,26 +162,28 @@ func (p *Parser) findOverrideFlag(args []string) (string, bool) {
 	return "", false
 }
 
-func (p *Parser) findConfigFileFlag(args []string) (string, bool) {
+// findConfigFileFlag returns the value of the config file env var or CLI flag.
+// If neither are set, it returns the default value.
+func (p *Parser) findConfigFileFlag(args []string) string {
 	if envVal := os.Getenv(p.EnvName); p.EnvName != "" && envVal != "" {
-		return envVal, true
+		return envVal
 	}
 
 	for i, arg := range args {
 		for _, flagName := range p.ConfigFlags {
 			if flagName == arg {
 				if len(args) > i+1 {
-					return args[i+1], true
+					return args[i+1]
 				}
 				// This is actually invalid, so we rely on the CLI parser after the fact flagging it as bad
-				return "", false
+				return ""
 			} else if strings.HasPrefix(arg, flagName+"=") {
-				return arg[len(flagName)+1:], true
+				return arg[len(flagName)+1:]
 			}
 		}
 	}
 
-	return p.DefaultConfig, false
+	return p.DefaultConfig
 }
 
 func (p *Parser) findStart(args []string) ([]string, []string, bool) {
@@ -237,17 +240,23 @@ func dotDFiles(basefile string) (result []string, _ error) {
 	return
 }
 
+// readConfigFile returns a flattened arg list generated from the specified config
+// file, and any config file dropins in the dropin directory that corresponds to that
+// config file.  The config file or at least one dropin must exist.
 func readConfigFile(file string) (result []string, _ error) {
 	files, err := dotDFiles(file)
 	if err != nil {
 		return nil, err
 	}
 
-	_, err = os.Stat(file)
-	if os.IsNotExist(err) && len(files) > 0 {
-	} else if err != nil {
-		return nil, err
+	if _, err = os.Stat(file); err != nil {
+		// If the config file doesn't exist and we have dropins that's fine.
+		// Other errors are bubbled up regardless of how many dropins we have.
+		if !(os.IsNotExist(err) && len(files) > 0) {
+			return nil, err
+		}
 	} else {
+		// The config file exists, load it first.
 		files = append([]string{file}, files...)
 	}
 
@@ -321,6 +330,7 @@ func toSlice(v interface{}) []interface{} {
 	}
 }
 
+// readConfigFileData returns the contents of a local or remote file
 func readConfigFileData(file string) ([]byte, error) {
 	u, err := url.Parse(file)
 	if err != nil {
diff --git a/pkg/configfilearg/parser_test.go b/pkg/configfilearg/parser_test.go
index 1dc4640ab9d8..84f7bac59c45 100644
--- a/pkg/configfilearg/parser_test.go
+++ b/pkg/configfilearg/parser_test.go
@@ -120,61 +120,52 @@ func Test_UnitParser_findConfigFileFlag(t *testing.T) {
 		fields fields
 		arg    []string
 		want   string
-		found  bool
 	}{
 		{
-			name:  "default case",
-			arg:   nil,
-			found: false,
+			name: "default case",
+			arg:  nil,
 		},
 		{
-			name:  "simple case",
-			arg:   []string{"asdf", "-c", "value"},
-			want:  "value",
-			found: true,
+			name: "simple case",
+			arg:  []string{"asdf", "-c", "value"},
+			want: "value",
 		},
 		{
-			name:  "invalid args string",
-			arg:   []string{"-c"},
-			found: false,
+			name: "invalid args string",
+			arg:  []string{"-c"},
 		},
 		{
-			name:  "empty arg value",
-			arg:   []string{"-c="},
-			found: true,
+			name: "empty arg value",
+			arg:  []string{"-c="},
 		},
 		{
 			name: "empty arg value override default",
 			fields: fields{
 				DefaultConfig: "def",
 			},
-			arg:   []string{"-c="},
-			found: true,
+			arg: []string{"-c="},
 		},
 		{
 			fields: fields{
 				DefaultConfig: "def",
 			},
-			arg:   []string{"-c"},
-			found: false,
-			name:  "invalid args always return no value",
+			arg:  []string{"-c"},
+			name: "invalid args always return no value",
 		},
 		{
 			fields: fields{
 				DefaultConfig: "def",
 			},
-			arg:   []string{"-c", "value"},
-			want:  "value",
-			found: true,
-			name:  "value override default",
+			arg:  []string{"-c", "value"},
+			want: "value",
+			name: "value override default",
 		},
 		{
 			fields: fields{
 				DefaultConfig: "def",
 			},
-			want:  "def",
-			found: false,
-			name:  "default gets used when nothing is passed",
+			want: "def",
+			name: "default gets used when nothing is passed",
 		},
 		{
 			name: "env override args",
@@ -182,18 +173,16 @@ func Test_UnitParser_findConfigFileFlag(t *testing.T) {
 				DefaultConfig: "def",
 				env:           "env",
 			},
-			arg:   []string{"-c", "value"},
-			want:  "env",
-			found: true,
+			arg:  []string{"-c", "value"},
+			want: "env",
 		},
 		{
 			name: "garbage in start and end",
 			fields: fields{
 				DefaultConfig: "def",
 			},
-			arg:   []string{"before", "-c", "value", "after"},
-			want:  "value",
-			found: true,
+			arg:  []string{"before", "-c", "value", "after"},
+			want: "value",
 		},
 	}
 	for _, tt := range tests {
@@ -207,13 +196,10 @@ func Test_UnitParser_findConfigFileFlag(t *testing.T) {
 			defer os.Unsetenv(tt.fields.env)
 			os.Setenv(p.EnvName, tt.fields.env)
 
-			got, found := p.findConfigFileFlag(tt.arg)
+			got := p.findConfigFileFlag(tt.arg)
 			if got != tt.want {
 				t.Errorf("Parser.findConfigFileFlag() got = %+v\nWant = %+v", got, tt.want)
 			}
-			if found != tt.found {
-				t.Errorf("Parser.findConfigFileFlag() found = %+v\nWant = %+v", found, tt.found)
-			}
 		})
 	}
 }
@@ -286,13 +272,33 @@ func Test_UnitParser_Parse(t *testing.T) {
 			want: []string{"server"},
 		},
 		{
-			name: "fail when missing config",
+			name: "ignore missing config when set",
 			fields: fields{
 				After:         []string{"server", "agent"},
 				FlagNames:     []string{"-c", "--config"},
 				DefaultConfig: "missing",
 			},
-			arg:     []string{"server", "-c=missing"},
+			arg:  []string{"server", "-c=missing"},
+			want: []string{"server", "-c=missing"},
+		},
+		{
+			name: "fail when config cannot be parsed",
+			fields: fields{
+				After:         []string{"server", "agent"},
+				FlagNames:     []string{"-c", "--config"},
+				DefaultConfig: "./testdata/invalid.yaml",
+			},
+			arg:     []string{"server"},
+			wantErr: true,
+		},
+		{
+			name: "fail when dropin cannot be parsed",
+			fields: fields{
+				After:         []string{"server", "agent"},
+				FlagNames:     []string{"-c", "--config"},
+				DefaultConfig: "./testdata/invalid-dropin.yaml",
+			},
+			arg:     []string{"server"},
 			wantErr: true,
 		},
 		{
@@ -404,7 +410,59 @@ func Test_UnitParser_FindString(t *testing.T) {
 			want: "",
 		},
 		{
-			name: "Multiple custom configs exist, target exists in a secondary config",
+			name: "Default config file does not exist but dropin exists, target does not exist",
+			fields: fields{
+				FlagNames:     []string{"-c", "--config"},
+				EnvName:       "_TEST_ENV",
+				DefaultConfig: "./testdata/dropin-only.yaml",
+			},
+			args: args{
+				osArgs: []string{},
+				target: "tls",
+			},
+			want: "",
+		},
+		{
+			name: "Default config file does not exist but dropin exists, target exists",
+			fields: fields{
+				FlagNames:     []string{"-c", "--config"},
+				EnvName:       "_TEST_ENV",
+				DefaultConfig: "./testdata/dropin-only.yaml",
+			},
+			args: args{
+				osArgs: []string{},
+				target: "foo-bar",
+			},
+			want: "bar-foo",
+		},
+		{
+			name: "Custom config file does not exist but dropin exists, target does not exist",
+			fields: fields{
+				FlagNames:     []string{"-c", "--config"},
+				EnvName:       "_TEST_ENV",
+				DefaultConfig: "./testdata/defaultdata.yaml",
+			},
+			args: args{
+				osArgs: []string{"-c", "./testdata/dropin-only.yaml"},
+				target: "tls",
+			},
+			want: "",
+		},
+		{
+			name: "Custom config file does not exist but dropin exists, target exists",
+			fields: fields{
+				FlagNames:     []string{"-c", "--config"},
+				EnvName:       "_TEST_ENV",
+				DefaultConfig: "./testdata/defaultdata.yaml",
+			},
+			args: args{
+				osArgs: []string{"-c", "./testdata/dropin-only.yaml"},
+				target: "foo-bar",
+			},
+			want: "bar-foo",
+		},
+		{
+			name: "Multiple custom configs exist, target exists in a dropin config",
 			fields: fields{
 				FlagNames:     []string{"-c", "--config"},
 				EnvName:       "_TEST_ENV",
@@ -417,7 +475,7 @@ func Test_UnitParser_FindString(t *testing.T) {
 			want: "beta",
 		},
 		{
-			name: "Multiple custom configs exist, multiple targets exist in multiple secondary config, replacement",
+			name: "Multiple custom configs exist, multiple targets exist in multiple dropin config, replacement",
 			fields: fields{
 				FlagNames:     []string{"-c", "--config"},
 				EnvName:       "_TEST_ENV",
@@ -430,7 +488,7 @@ func Test_UnitParser_FindString(t *testing.T) {
 			want: "bar-foo",
 		},
 		{
-			name: "Multiple custom configs exist, multiple targets exist in multiple secondary config, appending",
+			name: "Multiple custom configs exist, multiple targets exist in multiple dropin config, appending",
 			fields: fields{
 				FlagNames:     []string{"-c", "--config"},
 				EnvName:       "_TEST_ENV",
diff --git a/pkg/configfilearg/testdata/dropin-only.yaml.d/01-data.yml b/pkg/configfilearg/testdata/dropin-only.yaml.d/01-data.yml
new file mode 100644
index 000000000000..9a0a098f7c73
--- /dev/null
+++ b/pkg/configfilearg/testdata/dropin-only.yaml.d/01-data.yml
@@ -0,0 +1,15 @@
+foo-bar: get-overriden
+a-slice:
+- 1
+- "1.5"
+- "2"
+- ""
+- three
+b-string: one
+c-slice:
+- one
+- two
+d-slice:
+- one
+- two
+f-string: beta
\ No newline at end of file
diff --git a/pkg/configfilearg/testdata/dropin-only.yaml.d/02-data-ignore-this.txt b/pkg/configfilearg/testdata/dropin-only.yaml.d/02-data-ignore-this.txt
new file mode 100644
index 000000000000..f8048ad0559b
--- /dev/null
+++ b/pkg/configfilearg/testdata/dropin-only.yaml.d/02-data-ignore-this.txt
@@ -0,0 +1 @@
+foo-bar: ignored
diff --git a/pkg/configfilearg/testdata/dropin-only.yaml.d/02-data.yaml b/pkg/configfilearg/testdata/dropin-only.yaml.d/02-data.yaml
new file mode 100644
index 000000000000..0947f7ec4bd7
--- /dev/null
+++ b/pkg/configfilearg/testdata/dropin-only.yaml.d/02-data.yaml
@@ -0,0 +1,10 @@
+foo-bar: bar-foo
+b-string+: two
+c-slice+:
+- three
+d-slice:
+- three
+- four
+e-slice+:
+- one
+- two
\ No newline at end of file
diff --git a/pkg/configfilearg/testdata/invalid-dropin.yaml.d/01-data.yml b/pkg/configfilearg/testdata/invalid-dropin.yaml.d/01-data.yml
new file mode 100644
index 000000000000..4bd4de28404f
--- /dev/null
+++ b/pkg/configfilearg/testdata/invalid-dropin.yaml.d/01-data.yml
@@ -0,0 +1 @@
+!invalid
diff --git a/pkg/configfilearg/testdata/invalid.yaml b/pkg/configfilearg/testdata/invalid.yaml
new file mode 100644
index 000000000000..4bd4de28404f
--- /dev/null
+++ b/pkg/configfilearg/testdata/invalid.yaml
@@ -0,0 +1 @@
+!invalid