Difference between _JAVA_OPTIONS, JAVA_TOOL_OPTIONS and JAVA_OPTS

You have pretty much nailed it except that these options are picked up even if you start JVM in-process via a library call.

The fact that _JAVA_OPTIONS is not documented suggests that it is not recommended to use this variable, and I’ve actually seen people abuse it by setting it in their ~/.bashrc. However, if you want to get to the bottom of this problem, you can check the source of Oracle HotSpot VM (e.g. in OpenJDK7).

You should also remember that there is no guarantee other VMs have or will continue to have support for undocumented variables.

UPDATE 2015-08-04: To save five minutes for folks coming from search engines, _JAVA_OPTIONS trumps command-line arguments, which in turn trump JAVA_TOOL_OPTIONS.

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