diff --git a/e2e/__projects__/basic/components/TemplateString.vue b/e2e/__projects__/basic/components/TemplateString.vue
new file mode 100644
index 00000000..7454d234
--- /dev/null
+++ b/e2e/__projects__/basic/components/TemplateString.vue
@@ -0,0 +1,21 @@
+<template>
+  <div
+    :data-sth="
+      gql`
+        query {
+          id
+        }
+      `
+    "
+  />
+</template>
+
+<script lang="ts">
+export default {
+  methods: {
+    gql([str]) {
+      return str
+    }
+  }
+}
+</script>
diff --git a/e2e/__projects__/basic/package.json b/e2e/__projects__/basic/package.json
index 0ed65a1a..d6cbbcb1 100644
--- a/e2e/__projects__/basic/package.json
+++ b/e2e/__projects__/basic/package.json
@@ -38,6 +38,13 @@
       "vue-jest": {
         "pug": {
           "basedir": "./"
+        },
+        "templateCompiler": {
+          "transpileOptions": {
+            "transforms": {
+              "dangerousTaggedTemplateString": true
+            }
+          }
         }
       }
     }
diff --git a/e2e/__projects__/basic/test.js b/e2e/__projects__/basic/test.js
index 20adeb87..51a5bc2b 100644
--- a/e2e/__projects__/basic/test.js
+++ b/e2e/__projects__/basic/test.js
@@ -1,5 +1,6 @@
 import { mount } from '@vue/test-utils'
 import TypeScript from './components/TypeScript.vue'
+import TemplateString from './components/TemplateString.vue'
 import { resolve } from 'path'
 import { readFileSync } from 'fs'
 import jestVue from 'vue-jest'
@@ -81,6 +82,15 @@ test('processes .vue files with lang set to typescript', () => {
   expect(wrapper.element.tagName).toBe('DIV')
 })
 
+test('processes .vue files with template strings in the template', () => {
+  const wrapper = mount(TemplateString)
+  expect(wrapper.attributes('data-sth')).toBe(`
+      query {
+        id
+      }
+    `)
+})
+
 test('processes functional components', () => {
   const clickSpy = jest.fn()
   const wrapper = mount(FunctionalSFC, {
diff --git a/lib/process.js b/lib/process.js
index bdd00e37..1a462dc5 100644
--- a/lib/process.js
+++ b/lib/process.js
@@ -57,16 +57,21 @@ function processTemplate(template, filename, config) {
     template.content = loadSrc(template.src, filename)
   }
 
+  const userTemplateCompilerOptions = vueJestConfig.templateCompiler || {}
   const result = compilerUtils.compileTemplate({
     source: template.content,
     compiler: VueTemplateCompiler,
     filename: filename,
-    compilerOptions: {
-      optimize: false
-    },
     isFunctional: template.attrs.functional,
     preprocessLang: template.lang,
-    preprocessOptions: vueJestConfig[template.lang]
+    preprocessOptions: vueJestConfig[template.lang],
+    ...userTemplateCompilerOptions,
+    compilerOptions: {
+      optimize: false,
+      ...userTemplateCompilerOptions.compilerOptions
+    },
+    transformAssetUrls: { ...userTemplateCompilerOptions.transformAssetUrls },
+    transpileOptions: { ...userTemplateCompilerOptions.transpileOptions }
   })
 
   logResultErrors(result)