diff --git a/doc/api/cluster.markdown b/doc/api/cluster.markdown
index 9a6e51ff6f..e4c2111f04 100644
--- a/doc/api/cluster.markdown
+++ b/doc/api/cluster.markdown
@@ -250,7 +250,7 @@ See [child_process event: 'exit'](child_process.html#child_process_event_exit).
 
 ## Event: 'setup'
 
-Emitted the first time that `.setupMaster()` is called.
+Emitted every time `.setupMaster()` is called with a `settings` argument.
 
 ## cluster.setupMaster([settings])
 
@@ -266,23 +266,26 @@ the settings will be present in `cluster.settings`.
 
 Note that:
 
-* Only the first call to `.setupMaster()` has any effect, subsequent calls are
-  ignored
-* That because of the above, the *only* attribute of a worker that may be
-  customized per-worker is the `env` passed to `.fork()`
-* `.fork()` calls `.setupMaster()` internally to establish the defaults, so to
-  have any effect, `.setupMaster()` must be called *before* any calls to
-  `.fork()`
+* any settings changes only affect future calls to `.fork()` and have no
+  effect on workers that are already running
+* The *only* attribute of a worker that cannot be set via `.setupMaster()` is
+  the `env` passed to `.fork()`
+* the defaults above apply to the first call only, the defaults for later
+  calls is the current value at the time of `cluster.setupMaster()` is called
 
 Example:
 
-    var cluster = require("cluster");
+    var cluster = require('cluster');
+    cluster.setupMaster({
+      exec: 'worker.js',
+      args: ['--use', 'https'],
+      silent: true
+    });
+    cluster.fork(); // https worker
     cluster.setupMaster({
-      exec : "worker.js",
-      args : ["--use", "https"],
-      silent : true
+      args: ['--use', 'http']
     });
-    cluster.fork();
+    cluster.fork(); // http worker
 
 This can only be called from the master process.
 
diff --git a/lib/cluster.js b/lib/cluster.js
index 269040ae01..e5d3533da3 100644
--- a/lib/cluster.js
+++ b/lib/cluster.js
@@ -239,14 +239,13 @@ function masterInit() {
 
   var initialized = false;
   cluster.setupMaster = function(options) {
-    if (initialized === true) return;
-    initialized = true;
     var settings = {
       args: process.argv.slice(2),
       exec: process.argv[1],
       execArgv: process.execArgv,
       silent: false
     };
+    settings = util._extend(settings, cluster.settings);
     settings = util._extend(settings, options || {});
     // Tell V8 to write profile data for each process to a separate file.
     // Without --logfile=v8-%p.log, everything ends up in a single, unusable
@@ -257,10 +256,15 @@ function masterInit() {
     {
       settings.execArgv = settings.execArgv.concat(['--logfile=v8-%p.log']);
     }
+    cluster.settings = settings;
+    if (initialized === true)
+      return options && process.nextTick(function() {
+        cluster.emit('setup');
+      });
+    initialized = true;
     schedulingPolicy = cluster.schedulingPolicy;  // Freeze policy.
     assert(schedulingPolicy === SCHED_NONE || schedulingPolicy === SCHED_RR,
            'Bad cluster.schedulingPolicy: ' + schedulingPolicy);
-    cluster.settings = settings;
 
     process.on('internalMessage', function(message) {
       if (message.cmd !== 'NODE_DEBUG_ENABLED') return;
diff --git a/test/simple/test-cluster-setup-master-cumulative.js b/test/simple/test-cluster-setup-master-cumulative.js
new file mode 100644
index 0000000000..2f69cd3689
--- /dev/null
+++ b/test/simple/test-cluster-setup-master-cumulative.js
@@ -0,0 +1,62 @@
+// Copyright Joyent, Inc. and other Node contributors.
+//
+// Permission is hereby granted, free of charge, to any person obtaining a
+// copy of this software and associated documentation files (the
+// "Software"), to deal in the Software without restriction, including
+// without limitation the rights to use, copy, modify, merge, publish,
+// distribute, sublicense, and/or sell copies of the Software, and to permit
+// persons to whom the Software is furnished to do so, subject to the
+// following conditions:
+//
+// The above copyright notice and this permission notice shall be included
+// in all copies or substantial portions of the Software.
+//
+// THE SOFTWARE IS PROVIDED "AS IS", WITHOUT WARRANTY OF ANY KIND, EXPRESS
+// OR IMPLIED, INCLUDING BUT NOT LIMITED TO THE WARRANTIES OF
+// MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT. IN
+// NO EVENT SHALL THE AUTHORS OR COPYRIGHT HOLDERS BE LIABLE FOR ANY CLAIM,
+// DAMAGES OR OTHER LIABILITY, WHETHER IN AN ACTION OF CONTRACT, TORT OR
+// OTHERWISE, ARISING FROM, OUT OF OR IN CONNECTION WITH THE SOFTWARE OR THE
+// USE OR OTHER DEALINGS IN THE SOFTWARE.
+
+
+var common = require('../common');
+var assert = require('assert');
+var cluster = require('cluster');
+
+assert(cluster.isMaster);
+
+assert.deepEqual(cluster.settings, {},
+                 'cluster.settings should not be initialized until needed');
+
+cluster.setupMaster();
+assert.deepEqual(cluster.settings, {
+  args: process.argv.slice(2),
+  exec: process.argv[1],
+  execArgv: process.execArgv,
+  silent: false,
+});
+console.log('ok sets defaults');
+
+cluster.setupMaster({ exec: 'overridden' });
+assert.strictEqual(cluster.settings.exec, 'overridden');
+console.log('ok overrids defaults');
+
+cluster.setupMaster({ args: ['foo', 'bar'] });
+assert.strictEqual(cluster.settings.exec, 'overridden');
+assert.deepEqual(cluster.settings.args, ['foo', 'bar']);
+
+cluster.setupMaster({ execArgv: ['baz', 'bang'] });
+assert.strictEqual(cluster.settings.exec, 'overridden');
+assert.deepEqual(cluster.settings.args, ['foo', 'bar']);
+assert.deepEqual(cluster.settings.execArgv, ['baz', 'bang']);
+console.log('ok preserves unchanged settings on repeated calls');
+
+cluster.setupMaster();
+assert.deepEqual(cluster.settings, {
+  args: ['foo', 'bar'],
+  exec: 'overridden',
+  execArgv: ['baz', 'bang'],
+  silent: false,
+});
+console.log('ok preserves current settings');
diff --git a/test/simple/test-cluster-setup-master-multiple.js b/test/simple/test-cluster-setup-master-multiple.js
new file mode 100644
index 0000000000..21756b9c0c
--- /dev/null
+++ b/test/simple/test-cluster-setup-master-multiple.js
@@ -0,0 +1,71 @@
+// Copyright Joyent, Inc. and other Node contributors.
+//
+// Permission is hereby granted, free of charge, to any person obtaining a
+// copy of this software and associated documentation files (the
+// "Software"), to deal in the Software without restriction, including
+// without limitation the rights to use, copy, modify, merge, publish,
+// distribute, sublicense, and/or sell copies of the Software, and to permit
+// persons to whom the Software is furnished to do so, subject to the
+// following conditions:
+//
+// The above copyright notice and this permission notice shall be included
+// in all copies or substantial portions of the Software.
+//
+// THE SOFTWARE IS PROVIDED "AS IS", WITHOUT WARRANTY OF ANY KIND, EXPRESS
+// OR IMPLIED, INCLUDING BUT NOT LIMITED TO THE WARRANTIES OF
+// MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT. IN
+// NO EVENT SHALL THE AUTHORS OR COPYRIGHT HOLDERS BE LIABLE FOR ANY CLAIM,
+// DAMAGES OR OTHER LIABILITY, WHETHER IN AN ACTION OF CONTRACT, TORT OR
+// OTHERWISE, ARISING FROM, OUT OF OR IN CONNECTION WITH THE SOFTWARE OR THE
+// USE OR OTHER DEALINGS IN THE SOFTWARE.
+
+
+var common = require('../common');
+var assert = require('assert');
+var cluster = require('cluster');
+
+assert(cluster.isMaster);
+
+// The cluster.settings object is cloned even though the current implementation
+// makes that unecessary. This is to make the test less fragile if the
+// implementation ever changes such that cluster.settings is mutated instead of
+// replaced.
+function cheapClone(obj) {
+  return JSON.parse(JSON.stringify(obj));
+}
+
+var configs = [];
+
+// Capture changes
+cluster.on('setup', function() {
+  console.log('"setup" emitted', cluster.settings);
+  configs.push(cheapClone(cluster.settings));
+});
+
+var execs = [
+  'node-next',
+  'node-next-2',
+  'node-next-3',
+];
+
+process.on('exit', function assertTests() {
+  // Tests that "setup" is emitted for every call to setupMaster
+  assert.strictEqual(configs.length, execs.length);
+
+  assert.strictEqual(configs[0].exec, execs[0]);
+  assert.strictEqual(configs[1].exec, execs[1]);
+  assert.strictEqual(configs[2].exec, execs[2]);
+});
+
+// Make changes to cluster settings
+execs.forEach(function(v, i) {
+  setTimeout(function() {
+    cluster.setupMaster({ exec: v });
+  }, i * 100);
+});
+
+// cluster emits 'setup' asynchronously, so we must stay alive long
+// enough for that to happen
+setTimeout(function() {
+  console.log('cluster setup complete');
+}, (execs.length + 1) * 100);