diff --git a/nixos/modules/installer/tools/nixos-install.sh b/nixos/modules/installer/tools/nixos-install.sh
index e7cf52f5e32..7247451a85d 100644
--- a/nixos/modules/installer/tools/nixos-install.sh
+++ b/nixos/modules/installer/tools/nixos-install.sh
@@ -188,6 +188,15 @@ nix-env --store "$mountPoint" "${extraBuildFlags[@]}" \
 mkdir -m 0755 -p "$mountPoint/etc"
 touch "$mountPoint/etc/NIXOS"
 
+# Create a bind mount for each of the mount points inside the target file
+# system. This preserves the validity of their absolute paths after changing
+# the root with `nixos-enter`.
+# Without this the bootloader installation may fail due to options that
+# contain paths referenced during evaluation, like initrd.secrets.
+mount --rbind --mkdir "$mountPoint" "$mountPoint$mountPoint"
+mount --make-rslave "$mountPoint$mountPoint"
+trap 'umount -R "$mountPoint$mountPoint" && rmdir "$mountPoint$mountPoint"' EXIT
+
 # Switch to the new system configuration.  This will install Grub with
 # a menu default pointing at the kernel/initrd/etc of the new
 # configuration.
diff --git a/nixos/modules/system/boot/loader/grub/install-grub.pl b/nixos/modules/system/boot/loader/grub/install-grub.pl
index 20d48cde4ca..205f1513fd9 100644
--- a/nixos/modules/system/boot/loader/grub/install-grub.pl
+++ b/nixos/modules/system/boot/loader/grub/install-grub.pl
@@ -442,7 +442,7 @@ sub copyToKernelsDir {
 }
 
 sub addEntry {
-    my ($name, $path, $options) = @_;
+    my ($name, $path, $options, $current) = @_;
     return unless -e "$path/kernel" && -e "$path/initrd";
 
     my $kernel = copyToKernelsDir(Cwd::abs_path("$path/kernel"));
@@ -458,7 +458,14 @@ sub addEntry {
         # Make sure initrd is not world readable (won't work if /boot is FAT)
         umask 0137;
         my $initrdSecretsPathTemp = File::Temp::mktemp("$initrdSecretsPath.XXXXXXXX");
-        system("$path/append-initrd-secrets", $initrdSecretsPathTemp) == 0 or die "failed to create initrd secrets: $!\n";
+        if (system("$path/append-initrd-secrets", $initrdSecretsPathTemp) != 0) {
+          if ($current) {
+              die "failed to create initrd secrets $!\n";
+          } else {
+              say STDERR "warning: failed to create initrd secrets for \"$name\", an older generation";
+              say STDERR "note: this is normal after having removed or renamed a file in `boot.initrd.secrets`";
+          }
+        }
         # Check whether any secrets were actually added
         if (-e $initrdSecretsPathTemp && ! -z _) {
             rename $initrdSecretsPathTemp, $initrdSecretsPath or die "failed to move initrd secrets into place: $!\n";
@@ -491,7 +498,7 @@ sub addEntry {
         }
         $conf .= "\n";
     } else {
-        $conf .= "menuentry \"$name\" " . ($options||"") . " {\n";
+        $conf .= "menuentry \"$name\" " . $options . " {\n";
         if ($saveDefault) {
             $conf .= "  savedefault\n";
         }
@@ -511,7 +518,7 @@ sub addEntry {
 # Add default entries.
 $conf .= "$extraEntries\n" if $extraEntriesBeforeNixOS;
 
-addEntry("@distroName@ - Default", $defaultConfig, $entryOptions);
+addEntry("@distroName@ - Default", $defaultConfig, $entryOptions, 1);
 
 $conf .= "$extraEntries\n" unless $extraEntriesBeforeNixOS;
 
@@ -536,7 +543,7 @@ foreach my $link (@links) {
         my $linkname = basename($link);
         $entryName = "($linkname - $date - $version)";
     }
-    addEntry("@distroName@ - $entryName", $link);
+    addEntry("@distroName@ - $entryName", $link, "", 1);
 }
 
 my $grubBootPath = $grubBoot->path;
@@ -568,7 +575,7 @@ sub addProfile {
             -e "$link/nixos-version"
             ? readFile("$link/nixos-version")
             : basename((glob(dirname(Cwd::abs_path("$link/kernel")) . "/lib/modules/*"))[0]);
-        addEntry("@distroName@ - Configuration " . nrFromGen($link) . " ($date - $version)", $link, $subEntryOptions);
+        addEntry("@distroName@ - Configuration " . nrFromGen($link) . " ($date - $version)", $link, $subEntryOptions, 0);
     }
 
     $conf .= "}\n" if $grubVersion == 2;
diff --git a/nixos/tests/installer.nix b/nixos/tests/installer.nix
index 0884b0436f8..f5455267b28 100644
--- a/nixos/tests/installer.nix
+++ b/nixos/tests/installer.nix
@@ -51,7 +51,7 @@ let
           boot.loader.systemd-boot.enable = true;
         ''}
 
-        boot.initrd.secrets."/etc/secret" = /etc/nixos/secret;
+        boot.initrd.secrets."/etc/secret" = ./secret;
 
         users.users.alice = {
           isNormalUser = true;
@@ -150,8 +150,7 @@ let
           )
 
       with subtest("Shutdown system after installation"):
-          machine.succeed("umount /mnt/boot || true")
-          machine.succeed("umount /mnt")
+          machine.succeed("umount -R /mnt")
           machine.succeed("sync")
           machine.shutdown()
 
@@ -672,6 +671,55 @@ in {
     '';
   };
 
+  # Full disk encryption (root, kernel and initrd encrypted) using GRUB, GPT/UEFI,
+  # LVM-on-LUKS and a keyfile in initrd.secrets to enter the passphrase once
+  fullDiskEncryption = makeInstallerTest "fullDiskEncryption" {
+    createPartitions = ''
+      machine.succeed(
+          "flock /dev/vda parted --script /dev/vda -- mklabel gpt"
+          + " mkpart ESP fat32 1M 100MiB"  # /boot/efi
+          + " set 1 boot on"
+          + " mkpart primary ext2 1024MiB -1MiB",  # LUKS
+          "udevadm settle",
+          "modprobe dm_mod dm_crypt",
+          "dd if=/dev/random of=luks.key bs=256 count=1",
+          "echo -n supersecret | cryptsetup luksFormat -q --pbkdf-force-iterations 1000 --type luks1 /dev/vda2 -",
+          "echo -n supersecret | cryptsetup luksAddKey -q --pbkdf-force-iterations 1000 --key-file - /dev/vda2 luks.key",
+          "echo -n supersecret | cryptsetup luksOpen --key-file - /dev/vda2 crypt",
+          "pvcreate /dev/mapper/crypt",
+          "vgcreate crypt /dev/mapper/crypt",
+          "lvcreate -L 100M -n swap crypt",
+          "lvcreate -l '100%FREE' -n nixos crypt",
+          "mkfs.vfat -n efi /dev/vda1",
+          "mkfs.ext4 -L nixos /dev/crypt/nixos",
+          "mkswap -L swap /dev/crypt/swap",
+          "mount LABEL=nixos /mnt",
+          "mkdir -p /mnt/{etc/nixos,boot/efi}",
+          "mount LABEL=efi /mnt/boot/efi",
+          "swapon -L swap",
+          "mv luks.key /mnt/etc/nixos/"
+      )
+    '';
+    bootLoader = "grub";
+    grubUseEfi = true;
+    extraConfig = ''
+      boot.loader.grub.enableCryptodisk = true;
+      boot.loader.efi.efiSysMountPoint = "/boot/efi";
+
+      boot.initrd.secrets."/luks.key" = ./luks.key;
+      boot.initrd.luks.devices.crypt =
+        { device  = "/dev/vda2";
+          keyFile = "/luks.key";
+        };
+    '';
+    enableOCR = true;
+    preBootCommands = ''
+      machine.start()
+      machine.wait_for_text("Enter passphrase for")
+      machine.send_chars("supersecret\n")
+    '';
+  };
+
   swraid = makeInstallerTest "swraid" {
     createPartitions = ''
       machine.succeed(