diff --git a/.gitignore b/.gitignore
index 74d9ca99..efb00cf9 100644
--- a/.gitignore
+++ b/.gitignore
@@ -33,6 +33,7 @@ testdata/migrations/schema.sql
 vendor/
 .env
 .release-env
+.vscode/
 
 # test data
 cockroach-data/
diff --git a/connection.go b/connection.go
index f8b81d31..ecb3e87c 100644
--- a/connection.go
+++ b/connection.go
@@ -2,6 +2,7 @@ package pop
 
 import (
 	"context"
+	"database/sql"
 	"errors"
 	"fmt"
 	"sync/atomic"
@@ -185,21 +186,26 @@ func (c *Connection) Rollback(fn func(tx *Connection)) error {
 
 // NewTransaction starts a new transaction on the connection
 func (c *Connection) NewTransaction() (*Connection, error) {
+	return c.NewTransactionContextOptions(c.Context(), nil)
+}
+
+// NewTransactionContext starts a new transaction on the connection using the provided context
+func (c *Connection) NewTransactionContext(ctx context.Context) (*Connection, error) {
+	return c.NewTransactionContextOptions(ctx, nil)
+}
+
+// NewTransactionContextOptions starts a new transaction on the connection using the provided context and transaction options
+func (c *Connection) NewTransactionContextOptions(ctx context.Context, options *sql.TxOptions) (*Connection, error) {
 	var cn *Connection
 	if c.TX == nil {
-		tx, err := c.Store.Transaction()
+		tx, err := c.Store.TransactionContextOptions(ctx, options)
 		if err != nil {
 			return cn, fmt.Errorf("couldn't start a new transaction: %w", err)
 		}
-		var store store = tx
 
-		// Rewrap the store if it was a context store
-		if cs, ok := c.Store.(contextStore); ok {
-			store = contextStore{store: store, ctx: cs.ctx}
-		}
 		cn = &Connection{
 			ID:      randx.String(30),
-			Store:   store,
+			Store:   contextStore{store: tx, ctx: ctx},
 			Dialect: c.Dialect,
 			TX:      tx,
 		}
diff --git a/connection_test.go b/connection_test.go
index dfdb9756..a923a281 100644
--- a/connection_test.go
+++ b/connection_test.go
@@ -1,8 +1,10 @@
+//go:build sqlite
 // +build sqlite
 
 package pop
 
 import (
+	"context"
 	"testing"
 
 	"github.com/stretchr/testify/require"
@@ -52,3 +54,46 @@ func Test_Connection_Open_BadDriver(t *testing.T) {
 	err = c.Open()
 	r.Error(err)
 }
+
+func Test_Connection_Transaction(t *testing.T) {
+	r := require.New(t)
+	ctx := context.WithValue(context.Background(), "test", "test")
+
+	c, err := NewConnection(&ConnectionDetails{
+		URL: "sqlite://file::memory:?_fk=true",
+	})
+	r.NoError(err)
+	r.NoError(c.Open())
+	c = c.WithContext(ctx)
+
+	t.Run("func=NewTransaction", func(t *testing.T) {
+		r := require.New(t)
+		tx, err := c.NewTransaction()
+		r.NoError(err)
+
+		// has transaction and context
+		r.NotNil(tx.TX)
+		r.Nil(c.TX)
+		r.Equal(ctx, tx.Context())
+
+		// does not start a new transaction
+		ntx, err := tx.NewTransaction()
+		r.Equal(tx, ntx)
+
+		r.NoError(tx.TX.Rollback())
+	})
+
+	t.Run("func=NewTransactionContext", func(t *testing.T) {
+		r := require.New(t)
+		nctx := context.WithValue(ctx, "nested", "test")
+		tx, err := c.NewTransactionContext(nctx)
+		r.NoError(err)
+
+		// has transaction and context
+		r.NotNil(tx.TX)
+		r.Nil(c.TX)
+		r.Equal(nctx, tx.Context())
+
+		r.NoError(tx.TX.Rollback())
+	})
+}
diff --git a/dialect_sqlite.go b/dialect_sqlite.go
index d8400a50..35647c3b 100644
--- a/dialect_sqlite.go
+++ b/dialect_sqlite.go
@@ -182,22 +182,32 @@ func (m *sqlite) locker(l *sync.Mutex, fn func() error) error {
 }
 
 func (m *sqlite) CreateDB() error {
-	_, err := os.Stat(m.ConnectionDetails.Database)
+	durl := m.ConnectionDetails.Database
+
+	// Checking whether the url specifies in-memory mode
+	// as specified in https://github.com/mattn/go-sqlite3#faq
+	if strings.Contains(durl, ":memory:") || strings.Contains(durl, "mode=memory") {
+		log(logging.Info, "in memory db selected, no database file created.")
+
+		return nil
+	}
+
+	_, err := os.Stat(durl)
 	if err == nil {
-		return fmt.Errorf("could not create SQLite database '%s'; database exists", m.ConnectionDetails.Database)
+		return fmt.Errorf("could not create SQLite database '%s'; database exists", durl)
 	}
-	dir := filepath.Dir(m.ConnectionDetails.Database)
+	dir := filepath.Dir(durl)
 	err = os.MkdirAll(dir, 0766)
 	if err != nil {
-		return fmt.Errorf("could not create SQLite database '%s': %w", m.ConnectionDetails.Database, err)
+		return fmt.Errorf("could not create SQLite database '%s': %w", durl, err)
 	}
-	f, err := os.Create(m.ConnectionDetails.Database)
+	f, err := os.Create(durl)
 	if err != nil {
-		return fmt.Errorf("could not create SQLite database '%s': %w", m.ConnectionDetails.Database, err)
+		return fmt.Errorf("could not create SQLite database '%s': %w", durl, err)
 	}
 	_ = f.Close()
 
-	log(logging.Info, "created database '%s'", m.ConnectionDetails.Database)
+	log(logging.Info, "created database '%s'", durl)
 	return nil
 }
 
diff --git a/dialect_sqlite_test.go b/dialect_sqlite_test.go
index 83a0294a..ac5db21a 100644
--- a/dialect_sqlite_test.go
+++ b/dialect_sqlite_test.go
@@ -1,3 +1,4 @@
+//go:build sqlite
 // +build sqlite
 
 package pop
@@ -144,18 +145,51 @@ func Test_ConnectionDetails_FinalizeOSPath(t *testing.T) {
 
 func TestSqlite_CreateDB(t *testing.T) {
 	r := require.New(t)
-	dir := t.TempDir()
-	p := filepath.Join(dir, "testdb.sqlite")
-	cd := &ConnectionDetails{
-		Dialect:  "sqlite",
-		Database: p,
-	}
+
+	cd := &ConnectionDetails{Dialect: "sqlite"}
 	dialect, err := newSQLite(cd)
 	r.NoError(err)
-	r.NoError(dialect.CreateDB())
 
-	// Creating DB twice should produce an error
-	r.EqualError(dialect.CreateDB(), fmt.Sprintf("could not create SQLite database '%s'; database exists", p))
+	t.Run("CreateFile", func(t *testing.T) {
+		dir := t.TempDir()
+		cd.Database = filepath.Join(dir, "testdb.sqlite")
+
+		r.NoError(dialect.CreateDB())
+		r.FileExists(cd.Database)
+	})
+
+	t.Run("MemoryDB_tag", func(t *testing.T) {
+		dir := t.TempDir()
+		cd.Database = filepath.Join(dir, "file::memory:?cache=shared")
+
+		r.NoError(dialect.CreateDB())
+		r.NoFileExists(cd.Database)
+	})
+
+	t.Run("MemoryDB_only", func(t *testing.T) {
+		dir := t.TempDir()
+		cd.Database = filepath.Join(dir, ":memory:")
+
+		r.NoError(dialect.CreateDB())
+		r.NoFileExists(cd.Database)
+	})
+
+	t.Run("MemoryDB_param", func(t *testing.T) {
+		dir := t.TempDir()
+		cd.Database = filepath.Join(dir, "file:foobar?mode=memory&cache=shared")
+
+		r.NoError(dialect.CreateDB())
+		r.NoFileExists(cd.Database)
+	})
+
+	t.Run("CreateFile_ExistingDB", func(t *testing.T) {
+		dir := t.TempDir()
+		cd.Database = filepath.Join(dir, "testdb.sqlite")
+
+		r.NoError(dialect.CreateDB())
+		r.EqualError(dialect.CreateDB(), fmt.Sprintf("could not create SQLite database '%s'; database exists", cd.Database))
+	})
+
 }
 
 func TestSqlite_NewDriver(t *testing.T) {