diff --git a/README.adoc b/README.adoc
index 7fd3c7e..1fe1ba6 100644
--- a/README.adoc
+++ b/README.adoc
@@ -143,8 +143,16 @@ ruby_bundle(
 # You can specify more than one bundle in the WORKSPACE file
 ruby_bundle(
     name = "bundle_app_shopping",
-    gemfile = "//apps/shopping:Gemfile",
-    gemfile_lock = "//apps/shopping:Gemfile.lock",
+    gemfile = "//:apps/shopping/Gemfile",
+    gemfile_lock = "//:apps/shopping/Gemfile.lock",
+)
+
+# You can also install from Gemfile using `gemspec`.
+ruby_bundle(
+    name = "bundle_gemspec",
+    srcs = ["//:lib/my_gem/my_gem.gemspec"],
+    gemfile = "//:lib/my_gem/Gemfile",
+    gemfile_lock = "//:lib/my_gem/Gemfile.lock",
 )
 ----
 
@@ -477,6 +485,7 @@ ruby_bundle(
     bundler_version = "2.1.4",
     includes = {},
     excludes = {},
+    srcs = [],
     vendor_cache = False,
     ruby_sdk = "@org_ruby_lang_ruby_toolchain",
     ruby_interpreter = "@org_ruby_lang_ruby_toolchain//:ruby",
@@ -497,12 +506,17 @@ A unique name for this rule.
 The `Gemfile` which Bundler runs with.
 
 |`gemfile_lock` a|
-`Label, required`
+`Label, optional`
 
 The `Gemfile.lock` which Bundler runs with.
 
 NOTE: This rule never updates the `Gemfile.lock`. It is your responsibility to generate/update `Gemfile.lock`
 
+|`srcs` a|
+`List of Labels, optional`
+
+List of additional files required for Bundler to install gems. This could usually include `*.gemspec` files.
+
 |`vendor_cache` a|
 `Bool, optional`
 
@@ -529,10 +543,6 @@ List of glob patterns per gem to be excluded from the library. Keys are the name
 |===
 
 
-==== Limitations
-
-Installing using a `Gemfile` that uses the `gemspec` keyword is not currently supported.
-
 ==== Conventions
 
 `ruby_bundle` creates several targets that can be used downstream. In the examples below we assume that your `ruby_bundle` has a name `app_bundle`:
diff --git a/ruby/private/bundle/create_bundle_build_file.rb b/ruby/private/bundle/create_bundle_build_file.rb
index bc0b784..e832310 100755
--- a/ruby/private/bundle/create_bundle_build_file.rb
+++ b/ruby/private/bundle/create_bundle_build_file.rb
@@ -60,24 +60,28 @@
 
 # For ordinary gems, this path is like 'lib/ruby/3.0.0/gems/rspec-3.10.0'.
 # For gems with native extension installed via prebuilt packages, the last part of this path can
-# contain an OS-specific suffix like 'grpc-1.38.0-universal-darwin' or 'grpc-1.38.0-x86_64-linux' 
+# contain an OS-specific suffix like 'grpc-1.38.0-universal-darwin' or 'grpc-1.38.0-x86_64-linux'
 # instead of 'grpc-1.38.0'.
-# 
-# Since OS platform is unlikely to change between Bazel builds on the same machine, 
+#
+# Since OS platform is unlikely to change between Bazel builds on the same machine,
 # `#{gem_name}-#{gem_version}*` would be sufficient to narrow down matches to at most one.
+#
+# Library path differs across implementations as `lib/ruby` on MRI and `lib/jruby` on JRuby.
 GEM_PATH = ->(ruby_version, gem_name, gem_version) do
-  Dir.glob("lib/ruby/#{ruby_version}/gems/#{gem_name}-#{gem_version}*").first
+  Dir.glob("lib/#{RbConfig::CONFIG['RUBY_INSTALL_NAME']}/#{ruby_version}/gems/#{gem_name}-#{gem_version}*").first
 end
 
 # For ordinary gems, this path is like 'lib/ruby/3.0.0/specifications/rspec-3.10.0.gemspec'.
 # For gems with native extension installed via prebuilt packages, the last part of this path can
-# contain an OS-specific suffix like 'grpc-1.38.0-universal-darwin.gemspec' or 
+# contain an OS-specific suffix like 'grpc-1.38.0-universal-darwin.gemspec' or
 # 'grpc-1.38.0-x86_64-linux.gemspec' instead of 'grpc-1.38.0.gemspec'.
 #
 # Since OS platform is unlikely to change between Bazel builds on the same machine,
 # `#{gem_name}-#{gem_version}*.gemspec` would be sufficient to narrow down matches to at most one.
+#
+# Library path differs across implementations as `lib/ruby` on MRI and `lib/jruby` on JRuby.
 SPEC_PATH = ->(ruby_version, gem_name, gem_version) do
-  Dir.glob("lib/ruby/#{ruby_version}/specifications/#{gem_name}-#{gem_version}*.gemspec").first
+  Dir.glob("lib/#{RbConfig::CONFIG['RUBY_INSTALL_NAME']}/#{ruby_version}/specifications/#{gem_name}-#{gem_version}*.gemspec").first
 end
 
 require 'bundler'
@@ -247,6 +251,9 @@ def remove_bundler_version!
   end
 
   def register_gem(spec, template_out, bundle_lib_paths, bundle_binaries)
+    # Do not register local gems
+    return if spec.source.path?
+
     gem_path = GEM_PATH[ruby_version, spec.name, spec.version]
     spec_path = SPEC_PATH[ruby_version, spec.name, spec.version]
     base_dir = "lib/ruby/#{ruby_version}"
diff --git a/ruby/private/bundle/def.bzl b/ruby/private/bundle/def.bzl
index 1e1243b..e368bd4 100644
--- a/ruby/private/bundle/def.bzl
+++ b/ruby/private/bundle/def.bzl
@@ -114,16 +114,20 @@ def install_bundler(runtime_ctx, bundler_version):
     )
 
 def bundle_install(runtime_ctx, previous_result):
+    cwd = runtime_ctx.ctx.path(".")
+    bundler_args = [
+        "install",
+        "--binstubs={}".format(cwd.get_child(BUNDLE_BIN_PATH)),
+        "--path={}".format(cwd.get_child(BUNDLE_PATH)),
+        "--standalone",
+        "--gemfile={}".format(runtime_ctx.ctx.attr.gemfile.name),
+    ]
+    if runtime_ctx.ctx.attr.gemfile_lock:
+        bundler_args += ["--deployment", "--frozen"]
+
     result = run_bundler(
         runtime_ctx,
-        [
-            "install",
-            "--binstubs={}".format(BUNDLE_BIN_PATH),
-            "--path={}".format(BUNDLE_PATH),
-            "--deployment",
-            "--standalone",
-            "--frozen",
-        ],
+        bundler_args,
         previous_result,
     )
 
@@ -133,6 +137,11 @@ def bundle_install(runtime_ctx, previous_result):
         return result
 
 def generate_bundle_build_file(runtime_ctx, previous_result):
+    if runtime_ctx.ctx.attr.gemfile_lock:
+        gemfile_lock = runtime_ctx.ctx.attr.gemfile_lock.name
+    else:
+        gemfile_lock = "{}.lock".format(runtime_ctx.ctx.attr.gemfile.name)
+
     # Create the BUILD file to expose the gems to the WORKSPACE
     # USAGE: ./create_bundle_build_file.rb BUILD.bazel Gemfile.lock repo-name [excludes-json] workspace-name
     args = [
@@ -142,7 +151,7 @@ def generate_bundle_build_file(runtime_ctx, previous_result):
         "bundler/lib",
         SCRIPT_BUILD_FILE_GENERATOR,  # The template used to created bundle file
         "BUILD.bazel",  # Bazel build file (can be empty)
-        "Gemfile.lock",  # Gemfile.lock where we list all direct and transitive dependencies
+        gemfile_lock,  # Gemfile.lock where we list all direct and transitive dependencies
         runtime_ctx.ctx.name,  # Name of the target
         repr(runtime_ctx.ctx.attr.includes),
         repr(runtime_ctx.ctx.attr.excludes),
@@ -154,8 +163,9 @@ def generate_bundle_build_file(runtime_ctx, previous_result):
         fail("build file generation failed: %s%s" % (result.stdout, result.stderr))
 
 def _ruby_bundle_impl(ctx):
-    ctx.symlink(ctx.attr.gemfile, "Gemfile")
-    ctx.symlink(ctx.attr.gemfile_lock, "Gemfile.lock")
+    ctx.symlink(ctx.attr.gemfile, ctx.attr.gemfile.name)
+    if ctx.attr.gemfile_lock:
+        ctx.symlink(ctx.attr.gemfile_lock, ctx.attr.gemfile_lock.name)
     if ctx.attr.vendor_cache:
         ctx.symlink(
             ctx.path(str(ctx.path(ctx.attr.gemfile).dirname) + "/vendor"),
@@ -163,6 +173,8 @@ def _ruby_bundle_impl(ctx):
         )
     ctx.symlink(ctx.attr._create_bundle_build_file, SCRIPT_BUILD_FILE_GENERATOR)
     ctx.symlink(ctx.attr._install_bundler, SCRIPT_INSTALL_GEM)
+    for src in ctx.attr.srcs:
+        ctx.symlink(src, src.name)
 
     bundler_version = ctx.attr.bundler_version
 
diff --git a/ruby/private/constants.bzl b/ruby/private/constants.bzl
index d615ea6..a76f8f3 100644
--- a/ruby/private/constants.bzl
+++ b/ruby/private/constants.bzl
@@ -79,6 +79,9 @@ BUNDLE_ATTRS = {
     "gemfile_lock": attr.label(
         allow_single_file = True,
     ),
+    "srcs": attr.label_list(
+        allow_files = True,
+    ),
     "vendor_cache": attr.bool(
         doc = "Symlink the vendor directory into the Bazel build space, this allows Bundler to access vendored Gems",
     ),
diff --git a/ruby/private/toolchains/repository_context.bzl b/ruby/private/toolchains/repository_context.bzl
index b151531..221a4ac 100644
--- a/ruby/private/toolchains/repository_context.bzl
+++ b/ruby/private/toolchains/repository_context.bzl
@@ -45,6 +45,8 @@ def ruby_repository_context(repository_ctx, interpreter_path):
     rel_interpreter_path = str(interpreter_path)
     if rel_interpreter_path.startswith("/"):
         rel_interpreter_path = rel_interpreter_path[1:]
+    elif rel_interpreter_path.startswith("C:/"):
+        rel_interpreter_path = rel_interpreter_path[3:]
 
     return struct(
         # Location of the interpreter
diff --git a/ruby/private/toolchains/ruby_runtime.bzl b/ruby/private/toolchains/ruby_runtime.bzl
index 048084f..d3ec3ed 100644
--- a/ruby/private/toolchains/ruby_runtime.bzl
+++ b/ruby/private/toolchains/ruby_runtime.bzl
@@ -32,6 +32,8 @@ def _relativate(path):
     # TODO(yugui) support windows
     if path.startswith("/"):
         return path[1:]
+    elif path.startswith("C:/"):
+        return path[3:]
     else:
         return path
 
@@ -44,6 +46,19 @@ def _list_libdirs(ruby):
 
 def _install_dirs(ctx, ruby, *names):
     paths = sorted([ruby.rbconfig(ruby, name) for name in names])
+
+    # JRuby reports some of the directories as nulls.
+    paths = [path for path in paths if path]
+
+    # Sometimes we end up with the same directory multiple times
+    # so make sure paths are unique by converting it to set.
+    # For example, this is what we have on Fedora 34:
+    # $ ruby -rrbconfig -e "p RbConfig::CONFIG['rubyhdrdir']"
+    # "/usr/include"
+    # $ ruby -rrbconfig -e "p RbConfig::CONFIG['rubyarchhdrdir']"
+    # "/usr/include"
+    paths = depset(paths).to_list()
+
     rel_paths = [_relativate(path) for path in paths]
     for i, (path, rel_path) in enumerate(zip(paths, rel_paths)):
         if not _is_subpath(path, paths[:i]):