diff --git a/SETUP.md b/SETUP.md
index 695dd47..88bf565 100644
--- a/SETUP.md
+++ b/SETUP.md
@@ -79,7 +79,7 @@
 We fully support building on NixOS, and we provide a `shell.nix` file to make it easy. Just run `nix-shell` in the
 project root! This will drop you into a shell with all dependencies installed, and you can run `bazel ...` as usual.
 
-If you're using IntelliJ, you have to run IntelliJ _inside_ the Nix shell.
+You can also execute tools/bazel directly on a system with Nix installed, as our bazel wrapper automatically switches into the environment created by our `shell.nix`.
 
 ## IntelliJ
 
diff --git a/tools/bazel b/tools/bazel
index 7711189..4db2421 100755
--- a/tools/bazel
+++ b/tools/bazel
@@ -9,8 +9,24 @@
 # Jump into nix-shell if BAZEL_REAL is set to a /nix/store path and we aren't
 # inside our shell yet.
 if [[ "${BAZEL_REAL:-}" == /nix/store/* && -z "${MONOGON_NIXOS:-}" ]]; then
-  echo "BAZEL_REAL is pointing to a /nix/store path, overriding to nix-shell." >&2
+  echo "Detected Nix based bazel installation and we are not in a nix-shell, overriding to nix-shell." >&2
+  USE_NIX_SHELL=yes
+fi
 
+# If the wrapper is called directly we check if nix-shell is available
+# to automagically switch into the nix-shell. Otherwise complain and
+# exit.
+if [[ -z "${BAZEL_REAL:-}" ]]; then
+  if [[ -x $(command -v nix-shell) ]]; then
+    echo "BAZEL_REAL is not set and nix-shell is available, overriding to nix-shell" >&2
+    USE_NIX_SHELL=yes
+  else
+    echo "BAZEL_REAL is not set and nix-shell not available. Please check the setup guide." >&2
+    exit 1
+  fi
+fi
+
+if [[ -n "${USE_NIX_SHELL:-}" ]]; then
   # Jump to project root since bwrap hangs if we aren't there
   cd "${DIR}/../"
 
@@ -28,12 +44,6 @@
 BAZEL_ARGS="--noworkspace_rc --bazelrc ${DIR}/../.bazelrc.sandboxroot"
 
 prechecks() {
-  # Complain if script invoked directly.
-  if [[ -z "${BAZEL_REAL:-}" ]]; then
-    echo "BAZEL_REAL is not set - do not run directly, instead, use bazelisk" >&2
-    exit 1
-  fi
-
   # Recommend using Bazelisk instead of Bazel's "bazel.sh" wrapper.
   # Skip if we're inside the Nix shell (which uses a customized Bazel build).
   if [[ -z "${BAZELISK_SKIP_WRAPPER:-}" && -z "${MONOGON_NIXOS:-}" ]]; then