diff --git a/pkgs/compiler-pkgs/compiler-lib/compiler/commands/test.rkt b/pkgs/compiler-pkgs/compiler-lib/compiler/commands/test.rkt
index d71ae4e250..a71d110e52 100644
--- a/pkgs/compiler-pkgs/compiler-lib/compiler/commands/test.rkt
+++ b/pkgs/compiler-pkgs/compiler-lib/compiler/commands/test.rkt
@@ -43,7 +43,8 @@
   (define test-module (read (open-input-string (vector-ref argv 1))))
   (define d (read (open-input-string (vector-ref argv 2))))
 
-  (dynamic-require test-module d)
+  (parameterize ([current-command-line-arguments '#()])
+    (dynamic-require test-module d))
 
   (call-with-output-file*
    result-file
@@ -235,7 +236,8 @@
         (lambda (what get-default) (get-default))))
   (dynamic-require-elsewhere
    p d
-   #:timeout (or (lookup 'timeout
+   #:timeout (if default-timeout
+                 (lookup 'timeout
                          (lambda () default-timeout))
                  +inf.0)))
 
@@ -653,7 +655,7 @@
   (set-jobs! (string->number* "jobs" n exact-positive-integer?))]
  [("--timeout") seconds
   "Set default timeout to <seconds>"
-  (set-jobs! (string->number* "timeout" seconds real?))]
+  (set! default-timeout (string->number* "timeout" seconds real?))]
  [("--quiet-program" "-Q")
   "Quiet the program"
   (set! quiet-program? #t)]
diff --git a/pkgs/racket-pkgs/racket-doc/scribblings/raco/test.scrbl b/pkgs/racket-pkgs/racket-doc/scribblings/raco/test.scrbl
index a5c5e26d88..1f95c81492 100644
--- a/pkgs/racket-pkgs/racket-doc/scribblings/raco/test.scrbl
+++ b/pkgs/racket-pkgs/racket-doc/scribblings/raco/test.scrbl
@@ -79,7 +79,8 @@ The @exec{raco test} command accepts several flags:
 
  @item{@DFlag{timeout} @nonterm{seconds}
       --- Sets the default timeout (after which a test counts as failed)
-      to @nonterm{seconds}.}
+      to @nonterm{seconds}. Use @exec{+inf.0} to allow tests to run without
+      limit but allow @racket[timeout] sub-submodule configuration.}
 
  @item{@Flag{Q} or @DFlag{quiet-program}
        --- suppresses output from each test program.}
@@ -107,7 +108,8 @@ identifiers:
 
 @itemlist[
 
- @item{@racket[timeout] --- override the default timeout for the test}
+ @item{@racket[timeout] --- override the default timeout for the test,
+       when timeouts are enabled.}
 
 ]