--- a/src/share/vm/services/memoryPool.cpp	Tue Feb 16 02:16:09 2021 +0000
+++ b/src/share/vm/services/memoryPool.cpp	Tue Feb 02 17:44:14 2021 +0300
@@ -1,5 +1,5 @@
 /*
- * Copyright (c) 2003, 2014, Oracle and/or its affiliates. All rights reserved.
+ * Copyright (c) 2003, 2021, Oracle and/or its affiliates. All rights reserved.
  * DO NOT ALTER OR REMOVE COPYRIGHT NOTICES OR THIS FILE HEADER.
  *
  * This code is free software; you can redistribute it and/or modify it
@@ -273,8 +273,8 @@
 }
 
 size_t MetaspacePool::calculate_max_size() const {
-  return FLAG_IS_CMDLINE(MaxMetaspaceSize) ? MaxMetaspaceSize :
-                                             MemoryUsage::undefined_size();
+  return !FLAG_IS_DEFAULT(MaxMetaspaceSize) ? MaxMetaspaceSize :
+                                              MemoryUsage::undefined_size();
 }
 
 CompressedKlassSpacePool::CompressedKlassSpacePool() :

--- /dev/null	Thu Jan 01 00:00:00 1970 +0000
+++ b/test/runtime/Metaspace/MaxMetaspaceSizeEnvVarTest.java	Tue Feb 02 17:44:14 2021 +0300
@@ -0,0 +1,120 @@
+/*
+ * Copyright (c) 2021, Oracle and/or its affiliates. All rights reserved.
+ * DO NOT ALTER OR REMOVE COPYRIGHT NOTICES OR THIS FILE HEADER.
+ *
+ * This code is free software; you can redistribute it and/or modify it
+ * under the terms of the GNU General Public License version 2 only, as
+ * published by the Free Software Foundation.
+ *
+ * This code is distributed in the hope that it will be useful, but WITHOUT
+ * ANY WARRANTY; without even the implied warranty of MERCHANTABILITY or
+ * FITNESS FOR A PARTICULAR PURPOSE.  See the GNU General Public License
+ * version 2 for more details (a copy is included in the LICENSE file that
+ * accompanied this code).
+ *
+ * You should have received a copy of the GNU General Public License version
+ * 2 along with this work; if not, write to the Free Software Foundation,
+ * Inc., 51 Franklin St, Fifth Floor, Boston, MA 02110-1301 USA.
+ *
+ * Please contact Oracle, 500 Oracle Parkway, Redwood Shores, CA 94065 USA
+ * or visit www.oracle.com if you need additional information or have any
+ * questions.
+ */
+
+/*
+ * @test
+ * @bug 8260349
+ * @summary test that setting via the env-var and options file shows up as expected
+ * @library /testlibrary
+ * @run driver MaxMetaspaceSizeEnvVarTest
+ */
+
+import java.io.PrintWriter;
+import java.lang.management.ManagementFactory;
+import java.lang.management.MemoryPoolMXBean;
+import java.util.NoSuchElementException;
+
+import com.oracle.java.testlibrary.ProcessTools;
+import com.oracle.java.testlibrary.OutputAnalyzer;
+
+public class MaxMetaspaceSizeEnvVarTest {
+
+    // This is the test class we exec, passing the MaxMetaspaceSize flag
+    // by different mechanisms.
+    static class Main {
+        public static void main(String[] args) throws Exception {
+            long expected = Long.parseLong(args[0]);
+            MemoryPoolMXBean metaspaceMemoryPool =
+                ManagementFactory.getPlatformMXBeans(MemoryPoolMXBean.class)
+                .stream()
+                .filter(pool -> "Metaspace".equals(pool.getName()))
+                .findFirst()
+                .orElseThrow(() -> new NoSuchElementException("No value present"));
+            long max = metaspaceMemoryPool.getUsage().getMax();
+            System.out.println("Metaspace max usage is " + max);
+            if (max != expected) {
+                throw new RuntimeException("Metaspace max " + max +
+                                           " != " + expected);
+            }
+        }
+    }
+
+    static void report(String msg) {
+        System.out.println(msg);
+        System.err.println(msg);
+    }
+
+    public static void main(String... args) throws Exception {
+        final String max = String.valueOf(9 * 1024 * 1024); // 9 MB
+        final String flagRaw = "MaxMetaspaceSize=" + max;
+        final String flag = "-XX:" + flagRaw;
+        final String main = "MaxMetaspaceSizeEnvVarTest$Main";
+
+        ProcessBuilder pb = null;
+        OutputAnalyzer output = null;
+
+        int test = 1;
+        report("Test " + test + ": flag not set");
+
+        Main.main(new String[] { "-1" });  // -1 == undefined size
+        report("------ end Test " + test);
+        test++;
+
+        report("Test " + test + ": normal command-line flag");
+        pb = ProcessTools.createJavaProcessBuilder(flag, main, max);
+        output = new OutputAnalyzer(pb.start());
+        output.shouldHaveExitValue(0);
+        output.reportDiagnosticSummary();
+        report("------ end Test " + test);
+        test++;
+
+        String[] envVars = {
+            "_JAVA_OPTIONS",
+            "JAVA_TOOL_OPTIONS"
+        };
+
+        for (String envVar :  envVars) {
+            report("Test " + test + ": " + envVar + " env-var");
+            pb = ProcessTools.createJavaProcessBuilder(main, max);
+            pb.environment().put(envVar, flag);
+            output = new OutputAnalyzer(pb.start());
+            output.shouldHaveExitValue(0);
+            output.reportDiagnosticSummary();
+            report("------ end Test " + test);
+            test++;
+        }
+
+        report("Test " + test + ": .hotspotrc file");
+        final String rcFile = ".hotspotrc";
+        final String rcFileFlag = "-XX:Flags=" + rcFile;
+
+        PrintWriter pw = new PrintWriter(rcFile);
+        pw.println(flagRaw);
+        pw.close();
+        pb = ProcessTools.createJavaProcessBuilder(rcFileFlag, main, max);
+        output = new OutputAnalyzer(pb.start());
+        output.shouldHaveExitValue(0);
+        output.reportDiagnosticSummary();
+        report("------ end Test " + test);
+    }
+}