diff --git a/changelog/fragments/helm-overrides-template.yaml b/changelog/fragments/helm-overrides-template.yaml
new file mode 100644
index 00000000000..9a2cd4adee0
--- /dev/null
+++ b/changelog/fragments/helm-overrides-template.yaml
@@ -0,0 +1,6 @@
+# entries is a list of entries to include in
+# release notes and/or the migration guide
+entries:
+  - description: >
+      For helm-based operators, support go `text/template` expansion of override values
+    kind: addition
diff --git a/go.mod b/go.mod
index fafd3f49965..5a771785064 100644
--- a/go.mod
+++ b/go.mod
@@ -6,6 +6,7 @@ require (
 	github.com/blang/semver/v4 v4.0.0
 	github.com/fatih/structtag v1.1.0
 	github.com/go-logr/logr v0.4.0
+	github.com/go-task/slim-sprig v0.0.0-20210107165309-348f09dbbbc0
 	github.com/iancoleman/strcase v0.0.0-20191112232945-16388991a334
 	github.com/kr/text v0.2.0
 	github.com/markbates/inflect v1.0.4
diff --git a/go.sum b/go.sum
index 5e52c8fc55d..103a2751a6d 100644
--- a/go.sum
+++ b/go.sum
@@ -409,6 +409,7 @@ github.com/go-sql-driver/mysql v1.4.1/go.mod h1:zAC/RDZ24gD3HViQzih4MyKcchzm+sOG
 github.com/go-sql-driver/mysql v1.5.0 h1:ozyZYNQW3x3HtqT1jira07DN2PArx2v7/mN66gGcHOs=
 github.com/go-sql-driver/mysql v1.5.0/go.mod h1:DCzpHaOWr8IXmIStZouvnhqoel9Qv2LBy8hT2VhHyBg=
 github.com/go-stack/stack v1.8.0/go.mod h1:v0f6uXyyMGvRgIKkXu+yp6POWl0qKG85gN/melR3HDY=
+github.com/go-task/slim-sprig v0.0.0-20210107165309-348f09dbbbc0 h1:p104kn46Q8WdvHunIJ9dAyjPVtrBPhSr3KT2yUst43I=
 github.com/go-task/slim-sprig v0.0.0-20210107165309-348f09dbbbc0/go.mod h1:fyg7847qk6SyHyPtNmDHnmrv/HOrqktSC+C9fM+CJOE=
 github.com/gobuffalo/envy v1.6.5/go.mod h1:N+GkhhZ/93bGZc6ZKhJLP6+m+tCNPKwgSpH9kaifseQ=
 github.com/gobuffalo/envy v1.7.0/go.mod h1:n7DRkBerg/aorDM8kbduw5dN3oXGswK5liaSCx4T5NI=
diff --git a/internal/helm/watches/watches.go b/internal/helm/watches/watches.go
index c02413abb32..5f2b7d617cc 100644
--- a/internal/helm/watches/watches.go
+++ b/internal/helm/watches/watches.go
@@ -15,12 +15,15 @@
 package watches
 
 import (
+	"bytes"
 	"errors"
 	"fmt"
 	"io"
 	"io/ioutil"
 	"os"
+	"text/template"
 
+	sprig "github.com/go-task/slim-sprig"
 	"helm.sh/helm/v3/pkg/chartutil"
 	"k8s.io/apimachinery/pkg/runtime/schema"
 	"sigs.k8s.io/yaml"
@@ -110,21 +113,34 @@ func LoadReader(reader io.Reader) ([]Watch, error) {
 			trueVal := true
 			w.WatchDependentResources = &trueVal
 		}
-		w.OverrideValues = expandOverrideEnvs(w.OverrideValues)
+		w.OverrideValues, err = expandOverrideValues(w.OverrideValues)
+		if err != nil {
+			return nil, fmt.Errorf("failed to expand override values: %v", err)
+		}
 		watches[i] = w
 	}
 	return watches, nil
 }
 
-func expandOverrideEnvs(in map[string]string) map[string]string {
+func expandOverrideValues(in map[string]string) (map[string]string, error) {
 	if in == nil {
-		return nil
+		return nil, nil
 	}
 	out := make(map[string]string)
 	for k, v := range in {
-		out[k] = os.ExpandEnv(v)
+		envV := os.ExpandEnv(v)
+
+		v := &bytes.Buffer{}
+		tmplV, err := template.New(k).Funcs(sprig.TxtFuncMap()).Parse(envV)
+		if err != nil {
+			return nil, fmt.Errorf("invalid template string %q: %v", envV, err)
+		}
+		if err := tmplV.Execute(v, nil); err != nil {
+			return nil, fmt.Errorf("failed to execute template %q: %v", envV, err)
+		}
+		out[k] = v.String()
 	}
-	return out
+	return out, nil
 }
 
 func verifyGVK(gvk schema.GroupVersionKind) error {
diff --git a/internal/helm/watches/watches_test.go b/internal/helm/watches/watches_test.go
index cdea650c4ee..7f543f39105 100644
--- a/internal/helm/watches/watches_test.go
+++ b/internal/helm/watches/watches_test.go
@@ -55,7 +55,7 @@ func TestLoadReader(t *testing.T) {
 			expectErr: false,
 		},
 		{
-			name: "valid with override expansion",
+			name: "valid with override env expansion",
 			data: `---
 - group: mygroup
   version: v1alpha1
@@ -76,6 +76,48 @@ func TestLoadReader(t *testing.T) {
 			},
 			expectErr: false,
 		},
+		{
+			name: "valid with override template expansion",
+			data: `---
+- group: mygroup
+  version: v1alpha1
+  kind: MyKind
+  chart: ../../../internal/plugins/helm/v1/chartutil/testdata/test-chart
+  watchDependentResources: false
+  overrideValues:
+    repo: '{{ ("$MY_IMAGE" | split ":")._0 }}'
+    tag: '{{ ("$MY_IMAGE" | split ":")._1 }}'
+`,
+			env: map[string]string{"MY_IMAGE": "quay.io/operator-framework/helm-operator:latest"},
+			expectWatches: []Watch{
+				{
+					GroupVersionKind:        schema.GroupVersionKind{Group: "mygroup", Version: "v1alpha1", Kind: "MyKind"},
+					ChartDir:                "../../../internal/plugins/helm/v1/chartutil/testdata/test-chart",
+					WatchDependentResources: &falseVal,
+					OverrideValues: map[string]string{
+						"repo": "quay.io/operator-framework/helm-operator",
+						"tag":  "latest",
+					},
+				},
+			},
+			expectErr: false,
+		},
+
+		{
+			name: "invalid with override template expansion",
+			data: `---
+- group: mygroup
+  version: v1alpha1
+  kind: MyKind
+  chart: ../../../internal/plugins/helm/v1/chartutil/testdata/test-chart
+  watchDependentResources: false
+  overrideValues:
+    repo: '{{ ("$MY_IMAGE" | split ":")._0 }}'
+    tag: '{{ ("$MY_IMAGE" | split ":")._1'
+`,
+			env:       map[string]string{"MY_IMAGE": "quay.io/operator-framework/helm-operator:latest"},
+			expectErr: true,
+		},
 		{
 			name: "multiple gvk",
 			data: `---