diff --git a/azure-pipelines.yml b/azure-pipelines.yml
index 9bae94ec..8a2971a5 100644
--- a/azure-pipelines.yml
+++ b/azure-pipelines.yml
@@ -65,12 +65,8 @@ steps:
   name: test_prepare
 
 - powershell: |
-    $domain = Get-WmiObject -Class Win32_NetworkAdapterConfiguration |
-      Select -ExpandProperty DNSDomain |
-      Select -First 1
     Write-Host 'Writing compose config to disk'
     $content = @"
-    AZURE_DOMAIN=$domain
     VOLUME_ROOT=$ENV:TempVolumeRoot
     "@
     $Utf8NoBomEncoding = New-Object System.Text.UTF8Encoding $False
diff --git a/docker-compose.yml b/docker-compose.yml
index 392f1597..ec0f38b0 100644
--- a/docker-compose.yml
+++ b/docker-compose.yml
@@ -2,26 +2,30 @@ version: '3'
 
 services:
   puppet:
-    hostname: puppet
+    hostname: puppet.local
     image: puppet/puppetserver
     ports:
       - 8140:8140
     environment:
+      # necessary to set certname and server in puppet.conf, required by
+      # puppetserver ca cli application
+      - PUPPETSERVER_HOSTNAME=puppet.local
       # DNS_ALT_NAMES must be set before starting the stack the first time,
       # and must list all the names under which the puppetserver can be
-      # reached. 'puppet' must be one of them, otherwise puppetdb won't be
+      # reached. 'puppet.local' must be one of them, otherwise puppetdb won't be
       # able to get a cert. Add other names as a comma-separated list
-      - DNS_ALT_NAMES=puppet,${DNS_ALT_NAMES:-}
+      - DNS_ALT_NAMES=puppet,puppet.local,${DNS_ALT_NAMES:-}
       - PUPPERWARE_ANALYTICS_ENABLED=${PUPPERWARE_ANALYTICS_ENABLED:-true}
-      - PUPPETDB_SERVER_URLS=https://puppetdb:8081
+      - PUPPETDB_SERVER_URLS=https://puppetdb.local:8081
     volumes:
       - ${VOLUME_ROOT:-.}/volumes/code:/etc/puppetlabs/code/
       - ${VOLUME_ROOT:-.}/volumes/puppet:/etc/puppetlabs/puppet/
       - ${VOLUME_ROOT:-.}/volumes/serverdata:/opt/puppetlabs/server/data/puppetserver/
+    dns_search: '.local'
     networks:
       default:
         aliases:
-         - puppet.${AZURE_DOMAIN:-}
+         - puppet.local
 
   postgres:
     image: postgres:9.6
@@ -34,14 +38,20 @@ services:
     volumes:
       - ${VOLUME_ROOT:-.}/volumes/puppetdb-postgres/data:/var/lib/postgresql/data
       - ./postgres-custom:/docker-entrypoint-initdb.d
+    dns_search: '.local'
+    networks:
+      default:
+        aliases:
+         - postgres.local
 
   puppetdb:
-    hostname: puppetdb
+    hostname: puppetdb.local
     image: puppet/puppetdb
     environment:
       - PUPPERWARE_ANALYTICS_ENABLED=${PUPPERWARE_ANALYTICS_ENABLED:-true}
       # This name is an FQDN so the short name puppet doesn't collide outside compose network
-      - PUPPETSERVER_HOSTNAME=puppet.${AZURE_DOMAIN:-}
+      - PUPPETSERVER_HOSTNAME=puppet.local
+      - PUPPETDB_DATABASE_CONNECTION="//postgres.local:5432/puppetdb"
       - PUPPETDB_PASSWORD=puppetdb
       - PUPPETDB_USER=puppetdb
     ports:
@@ -52,3 +62,8 @@ services:
       - puppet
     volumes:
       - ${VOLUME_ROOT:-.}/volumes/puppetdb/ssl:/etc/puppetlabs/puppet/ssl/
+    dns_search: '.local'
+    networks:
+      default:
+        aliases:
+         - puppetdb.local
diff --git a/gem/lib/pupperware/spec_helper.rb b/gem/lib/pupperware/spec_helper.rb
index 6f1387c2..b00baab1 100644
--- a/gem/lib/pupperware/spec_helper.rb
+++ b/gem/lib/pupperware/spec_helper.rb
@@ -225,11 +225,10 @@ def wait_on_puppetserver_status(seconds = 180)
     end
   end
 
+  # agent_name is the fully qualified name of the node
   def clean_certificate(agent_name)
-    result = run_command('docker-compose --no-ansi exec -T puppet facter domain')
-    domain = result[:stdout].chomp
-    STDOUT.puts "cleaning cert for #{agent_name}.#{domain}"
-    result = run_command("docker-compose --no-ansi exec -T puppet puppetserver ca clean --certname #{agent_name}.#{domain}")
+    STDOUT.puts "cleaning cert for #{agent_name}"
+    result = run_command("docker-compose --no-ansi exec -T puppet puppetserver ca clean --certname #{agent_name}")
     return result[:status].exitstatus
   end
 
@@ -245,11 +244,10 @@ def run_agent(agent_name, network, server = get_container_hostname(get_service_c
     return result[:status].exitstatus
   end
 
+  # agent_name is the fully qualified name of the node
   def check_report(agent_name)
     pdb_uri = URI::join(get_service_base_uri('puppetdb', 8080), '/pdb/query/v4')
-    result = run_command("docker-compose --no-ansi exec -T puppet facter domain")
-    domain = result[:stdout].chomp
-    body = "{ \"query\": \"nodes { certname = \\\"#{agent_name}.#{domain}\\\" } \" }"
+    body = "{ \"query\": \"nodes { certname = \\\"#{agent_name}\\\" } \" }"
 
     return retry_block_up_to_timeout(120) do
       Net::HTTP.start(pdb_uri.hostname, pdb_uri.port) do |http|
diff --git a/spec/dockerfile_spec.rb b/spec/dockerfile_spec.rb
index b9c91999..edfdc664 100644
--- a/spec/dockerfile_spec.rb
+++ b/spec/dockerfile_spec.rb
@@ -14,7 +14,9 @@
   ]
 
   before(:all) do
-    @test_agent = "puppet_test#{Random.rand(1000)}"
+    # append .local to make sure Docker DNS resolver is used
+    # rather than appending a search domain due to resolv.conf
+    @test_agent = "puppet_test#{Random.rand(1000)}.local"
     @timestamps = []
     status = run_command('docker-compose --no-ansi version')[:status]
     if status.exitstatus != 0