diff --git a/hyde/plugin.py b/hyde/plugin.py
index 01153c1..ad8a7d0 100644
--- a/hyde/plugin.py
+++ b/hyde/plugin.py
@@ -8,11 +8,12 @@ from hyde import loader
 
 from hyde.exceptions import HydeException
 from hyde.fs import File
-from hyde.util import getLoggerWithNullHandler, first_match
+from hyde.util import getLoggerWithNullHandler, first_match, discover_executable
 from hyde.model import Expando
 
 from functools import partial
 
+import os
 import re
 import subprocess
 import traceback
@@ -255,6 +256,13 @@ class CLTransformer(Plugin):
             raise self.template.exception_class(
                     self.executable_not_found_message)
 
+        # Honour the PATH environment variable.
+        if not os.path.isabs(app_path):
+            app_path = discover_executable(app_path)
+            if app_path is None:
+                raise self.template.exception_class(
+                        self.executable_not_found_message)
+
         app = File(app_path)
 
         if not app.exists:
diff --git a/hyde/util.py b/hyde/util.py
index eff646e..0aced1b 100644
--- a/hyde/util.py
+++ b/hyde/util.py
@@ -2,6 +2,7 @@
 Module for python 2.6 compatibility.
 """
 import logging
+import os
 import sys
 from itertools import ifilter, izip, tee
 
@@ -122,3 +123,14 @@ def first_match(predicate, iterable):
         if predicate(item):
             return item
     return None
+
+def discover_executable(name):
+    """
+    Finds an executable in the path list provided by the PATH
+    environment variable.
+    """
+    for path in os.environ['PATH'].split(os.pathsep):
+        full_name = os.path.join(path, name)
+        if os.path.exists(full_name):
+            return full_name
+    return None