diff --git a/libmamba/include/mamba/api/configuration_impl.hpp b/libmamba/include/mamba/api/configuration_impl.hpp
index 365205b800..45e82424be 100644
--- a/libmamba/include/mamba/api/configuration_impl.hpp
+++ b/libmamba/include/mamba/api/configuration_impl.hpp
@@ -83,7 +83,7 @@ namespace mamba
         {
             static std::vector<std::string> default_value(const std::vector<T>& init)
             {
-                return std::vector<std::string>(init.size(), "default");
+                return std::vector<std::string>(std::max<size_t>(1, init.size()), "default");
             };
 
             static void merge(
diff --git a/libmamba/src/core/context.cpp b/libmamba/src/core/context.cpp
index e436c59f97..b0b1310f47 100644
--- a/libmamba/src/core/context.cpp
+++ b/libmamba/src/core/context.cpp
@@ -181,7 +181,7 @@ namespace mamba
         prefix_params.root_prefix = detail::get_root_prefix();
         prefix_params.conda_prefix = prefix_params.root_prefix;
 
-        envs_dirs = { prefix_params.root_prefix / "envs" };
+        envs_dirs = {};
         pkgs_dirs = { prefix_params.root_prefix / "pkgs",
                       fs::u8path("~") / ".mamba" / "pkgs"
 #ifdef _WIN32
diff --git a/micromamba/tests/test_create.py b/micromamba/tests/test_create.py
index 56b0089c4d..562f744f3d 100644
--- a/micromamba/tests/test_create.py
+++ b/micromamba/tests/test_create.py
@@ -253,6 +253,7 @@ def test_env_logging_overhead_regression(tmp_home, tmp_root_prefix, tmp_path):
     "similar_non_canonical,non_canonical_position",
     ((False, None), (True, "append"), (True, "prepend")),
 )
+@pytest.mark.parametrize("root_prefix_env_exists", (False, True))
 def test_target_prefix(
     tmp_home,
     tmp_root_prefix,
@@ -266,6 +267,7 @@ def test_target_prefix(
     current_target_prefix_fallback,
     similar_non_canonical,
     non_canonical_position,
+    root_prefix_env_exists,
 ):
     cmd = []
 
@@ -277,6 +279,11 @@ def test_target_prefix(
     else:
         root_prefix = Path(os.environ["MAMBA_ROOT_PREFIX"])
 
+    # TODO: Remove this call to `os.makedirs` once
+    # https://github.com/mamba-org/mamba/issues/3790 is fixed
+    if root_prefix_env_exists:
+        os.makedirs(Path(os.environ["MAMBA_ROOT_PREFIX"]) / "envs", exist_ok=True)
+
     env_prefix = tmp_path / "myenv"
 
     if target_is_root:
@@ -661,6 +668,93 @@ def test_create_envs_dirs(tmp_root_prefix: Path, tmp_path: Path):
     assert (tmp_path / env_name / "conda-meta" / "history").exists()
 
 
+@pytest.mark.parametrize("set_in_conda_envs_dirs", (False, True))
+@pytest.mark.parametrize("set_in_condarc", (False, True))
+@pytest.mark.parametrize("cli_root_prefix", (False, True))
+@pytest.mark.parametrize("check_config_only", (False, True))
+def test_root_prefix_precedence(
+    tmp_path,
+    tmp_home,
+    monkeypatch,
+    set_in_condarc,
+    set_in_conda_envs_dirs,
+    cli_root_prefix,
+    check_config_only,
+):
+    """
+    Test for root prefix precedence
+
+    Environments can be created in several places depending, in this order:
+      - 1. in the folder of `CONDA_ENVS_DIRS` if it is set
+      - 2. in the folder of `envs_dirs` if set in the rc file
+      - 3. the root prefix given by the user's command (e.g. specified via the `-r` option)
+      - 4. the usual root prefix (set generally by `MAMBA_ROOT_PREFIX`)
+    """
+
+    # Given by `CONDA_ENVS_DIRS`
+    conda_envs_dirs = tmp_path / "conda_envs_dirs" / "envs"
+    # Given by `envs_dirs` in the rc file
+    condarc_envs_dirs = tmp_path / "condarc_envs_dirs" / "envs"
+    # Given via the CLI
+    cli_provided_root = tmp_path / "cliroot"
+    cli_provided_root_envs = cli_provided_root / "envs"
+    # Given by `MAMBA_ROOT_PREFIX`
+    mamba_root_prefix = tmp_path / "envroot"
+    mamba_root_prefix_envs = mamba_root_prefix / "envs"
+
+    env_name = "foo"
+    monkeypatch.setenv("MAMBA_ROOT_PREFIX", str(mamba_root_prefix))
+    if set_in_conda_envs_dirs:
+        monkeypatch.setenv("CONDA_ENVS_DIRS", str(conda_envs_dirs))
+
+    with open(tmp_home / ".condarc", "w+") as f:
+        if set_in_condarc:
+            f.write(f"envs_dirs: [{str(condarc_envs_dirs)}]")
+
+    # TODO: Remove this call to `os.makedirs` once
+    # https://github.com/mamba-org/mamba/issues/3790 is fixed
+    for envs_folder in (condarc_envs_dirs, conda_envs_dirs, cli_provided_root, mamba_root_prefix):
+        os.makedirs(envs_folder, exist_ok=True)
+
+    cmd = ["-n", env_name, "--rc-file", tmp_home / ".condarc"]
+
+    if check_config_only:
+        cmd += ["--print-config-only", "--debug"]
+
+    if cli_root_prefix:
+        cmd += ["-r", cli_provided_root]
+
+    res = helpers.create(*cmd, no_rc=False)
+
+    def assert_env_exists(prefix_path):
+        assert Path(prefix_path / env_name).exists()
+
+    if check_config_only:
+        expected_envs_dirs = []
+        if set_in_conda_envs_dirs:
+            expected_envs_dirs.append(str(conda_envs_dirs))
+        if set_in_condarc:
+            expected_envs_dirs.append(str(condarc_envs_dirs))
+        if cli_root_prefix:
+            expected_envs_dirs.append(str(cli_provided_root_envs))
+        else:
+            expected_envs_dirs.append(str(mamba_root_prefix_envs))
+
+        effective_envs_dirs = res["envs_dirs"]
+        assert effective_envs_dirs == expected_envs_dirs
+
+    # Otherwise, we check that `foo` has been created in the directory
+    # based on precedence given above.
+    elif set_in_conda_envs_dirs:
+        assert_env_exists(conda_envs_dirs)
+    elif set_in_condarc:
+        assert_env_exists(condarc_envs_dirs)
+    elif cli_root_prefix:
+        assert_env_exists(cli_provided_root_envs)
+    else:
+        assert_env_exists(mamba_root_prefix_envs)
+
+
 @pytest.mark.skipif(
     helpers.dry_run_tests is helpers.DryRun.ULTRA_DRY,
     reason="Running only ultra-dry tests",