diff --git a/debian/gitlab.postinst b/debian/gitlab.postinst
index eacd940c02..3027588f27 100755
--- a/debian/gitlab.postinst
+++ b/debian/gitlab.postinst
@@ -50,6 +50,9 @@ cp ${gitlab_debian_conf_example} ${gitlab_debian_conf_private}
 test -f ${gitlab_debian_conf} && . ${gitlab_debian_conf}
 export DB RAILS_ENV
 
+# Required for embedded gems
+export GEM_HOME=/var/lib/gitlab/.gem
+
 # Read default values (we cannot do this before gitlab-debian.conf is exported
 # as we want to override variables set by gitlab-debian.conf in earlier gitlab
 # versions with gitlab-debian.defaults)