diff --git a/CHANGES.md b/CHANGES.md
index fb20f846..7c0d422f 100644
--- a/CHANGES.md
+++ b/CHANGES.md
@@ -12,6 +12,10 @@ details.
 
 - Add initial OCaml 5.3 support (#487, @NathanReb, @hhugo, @nojb)
 
+- Initialise OCaml 5.3's lexer with the `keywords` setting from `OCAMLPARAM` to
+  allow the standalone ppx driver to process old packages using `effect` as an
+  identifier (#535, @dra27)
+
 ### Other changes
 
 - Fix `deriving_inline` round-trip check so that it works with 5.01 <-> 5.02
diff --git a/astlib/keyword.ml b/astlib/keyword.ml
index 4e03a18b..e2beb24a 100644
--- a/astlib/keyword.ml
+++ b/astlib/keyword.ml
@@ -57,3 +57,27 @@ let is_keyword = function
   | "lsr" -> true
   | "asr" -> true
   | _ -> false
+
+let apply_keyword_edition () =
+  match Sys.getenv "OCAMLPARAM" with
+  | s ->
+      let items =
+        if String.equal s "" then []
+        else
+          (* cf. Compenv.parse_args *)
+          match s.[0] with
+          | (':' | '|' | ';' | ' ' | ',') as c ->
+              List.tl (String.split_on_char c s)
+          | _ -> String.split_on_char ',' s
+      in
+      let fold_settings acc item =
+        let len = String.length item in
+        if len >= 9 && String.sub item 0 9 = "keywords=" then
+          Some (String.sub item 9 (len - 9))
+        else acc
+      in
+      let keyword_edition = List.fold_left fold_settings None items in
+      (*IF_AT_LEAST 503 let () = if Option.is_some keyword_edition then Clflags.keyword_edition := keyword_edition in*)
+      (*IF_NOT_AT_LEAST 503 let () = ignore keyword_edition in*)
+      ()
+  | exception Not_found -> ()
diff --git a/astlib/keyword.mli b/astlib/keyword.mli
index 36c490f6..a7977796 100644
--- a/astlib/keyword.mli
+++ b/astlib/keyword.mli
@@ -1,2 +1,6 @@
 val is_keyword : string -> bool
 (** Check if a string is an OCaml keyword. *)
+
+val apply_keyword_edition : unit -> unit
+(** Processes any keywords= sections from the OCAMLPARAM environment variable
+    and initialises the compiler's lexer with the correct keyword set. *)
diff --git a/src/driver.ml b/src/driver.ml
index 5d91a6b4..ac20acf0 100644
--- a/src/driver.ml
+++ b/src/driver.ml
@@ -1417,6 +1417,7 @@ let get_args ?(standalone_args = standalone_args) () =
 let standalone_main () =
   let usage = Printf.sprintf "%s [extra_args] [<files>]" exe_name in
   let args = get_args () in
+  Astlib.Keyword.apply_keyword_edition ();
   Arg.parse (Arg.align args) set_input usage;
   interpret_mask ();
   if !request_print_transformations then (