diff --git a/cmd/root.go b/cmd/root.go
index a8cc188cab..0423099836 100644
--- a/cmd/root.go
+++ b/cmd/root.go
@@ -130,6 +130,9 @@ the latest stable version will be downloaded from the repository.`,
 					}
 				}
 				teleCommand = fmt.Sprintf("%s %s", cmd.CommandPath(), componentSpec)
+				if tag != "" {
+					fmt.Fprintln(os.Stderr, color.YellowString("--tag/-T is Deprecated in TiUP and moved to playground, it is suggested to use `tiup playground --tag` instead"))
+				}
 				return exec.RunComponent(env, tag, componentSpec, binPath, transparentParams)
 			}
 			return cmd.Help()
@@ -146,7 +149,7 @@ the latest stable version will be downloaded from the repository.`,
 	rootCmd.PersistentFlags().BoolVarP(&repoOpts.SkipVersionCheck, "skip-version-check", "", false, "Skip the strict version check, by default a version must be a valid SemVer string")
 	rootCmd.Flags().StringVarP(&binary, "binary", "B", "", "Print binary path of a specific version of a component `<component>[:version]`\n"+
 		"and the latest version installed will be selected if no version specified")
-	rootCmd.Flags().StringVarP(&tag, "tag", "T", "", "Specify a tag for component instance")
+	rootCmd.Flags().StringVarP(&tag, "tag", "T", "", "[Deprecated] Specify a tag for component instance")
 	rootCmd.Flags().StringVar(&binPath, "binpath", "", "Specify the binary path of component instance")
 	// Some components will define themself -h flag, eg:
 	// $ tiup dumpling -h ${host}.
diff --git a/components/playground/env.go b/components/playground/env.go
index c312b596bf..9e84d8f584 100644
--- a/components/playground/env.go
+++ b/components/playground/env.go
@@ -18,7 +18,6 @@ import (
 	"path/filepath"
 
 	"github.com/pingcap/errors"
-	"github.com/pingcap/tiup/pkg/localdata"
 )
 
 // targetTag find the target playground we want to send the command.
@@ -28,17 +27,13 @@ import (
 // 1. tiup playground
 // 2. tiup playground display
 func targetTag() (port int, err error) {
-	myTag := os.Getenv(localdata.EnvTag)
-	dir := os.Getenv(localdata.EnvNameInstanceDataDir)
-	dir = filepath.Dir(dir)
-
-	port, err = loadPort(filepath.Join(dir, myTag))
+	port, err = loadPort(dataDir)
 	if err == nil {
 		return port, nil
 	}
 	err = nil
 
-	_ = filepath.Walk(dir, func(path string, info os.FileInfo, err error) error {
+	_ = filepath.Walk(filepath.Dir(dataDir), func(path string, info os.FileInfo, err error) error {
 		if port != 0 {
 			return filepath.SkipDir
 		}
diff --git a/components/playground/main.go b/components/playground/main.go
index b59bc9773d..73850f5f27 100644
--- a/components/playground/main.go
+++ b/components/playground/main.go
@@ -18,6 +18,7 @@ import (
 	"database/sql"
 	"encoding/json"
 	"fmt"
+	"math"
 	"net/http"
 	_ "net/http/pprof"
 	"os"
@@ -71,6 +72,9 @@ var (
 	teleReport       *telemetry.Report
 	playgroundReport *telemetry.PlaygroundReport
 	options          = &BootOptions{}
+	tag              string
+	tiupDataDir      string
+	dataDir          string
 )
 
 const (
@@ -154,6 +158,32 @@ Examples:
 		Args: func(cmd *cobra.Command, args []string) error {
 			return nil
 		},
+		PersistentPreRunE: func(cmd *cobra.Command, args []string) error {
+			tiupDataDir = os.Getenv(localdata.EnvNameInstanceDataDir)
+			tiupHome := os.Getenv(localdata.EnvNameHome)
+			if tiupHome == "" {
+				tiupHome, _ = getAbsolutePath(filepath.Join("~", localdata.ProfileDirName))
+			}
+			if tiupDataDir == "" {
+				if tag == "" {
+					dataDir = filepath.Join(tiupHome, localdata.DataParentDir, base62Tag())
+				} else {
+					dataDir = filepath.Join(tiupHome, localdata.DataParentDir, tag)
+				}
+				if dataDir == "" {
+					return errors.Errorf("cannot read environment variable %s nor %s", localdata.EnvNameInstanceDataDir, localdata.EnvNameHome)
+				}
+				err := os.MkdirAll(dataDir, os.ModePerm)
+				if err != nil {
+					return err
+				}
+			} else {
+				dataDir = tiupDataDir
+			}
+			instanceName := dataDir[strings.LastIndex(dataDir, "/")+1:]
+			fmt.Printf("\033]0;TiUP Playground: %s\a", instanceName)
+			return nil
+		},
 		RunE: func(cmd *cobra.Command, args []string) error {
 			teleReport = new(telemetry.Report)
 			playgroundReport = new(telemetry.PlaygroundReport)
@@ -178,11 +208,6 @@ Examples:
 				return err
 			}
 
-			dataDir := os.Getenv(localdata.EnvNameInstanceDataDir)
-			if dataDir == "" {
-				return errors.Errorf("cannot read environment variable %s", localdata.EnvNameInstanceDataDir)
-			}
-
 			port, err := utils.GetFreePort("0.0.0.0", 9527)
 			if err != nil {
 				return err
@@ -223,6 +248,7 @@ Examples:
 				if atomic.LoadUint32(&booted) == 0 {
 					cancel()
 					time.AfterFunc(time.Second, func() {
+						removeData()
 						os.Exit(0)
 					})
 					return
@@ -233,6 +259,7 @@ Examples:
 				sig = (<-sc).(syscall.Signal)
 				atomic.StoreInt32(&p.curSig, int32(syscall.SIGKILL))
 				if sig == syscall.SIGINT {
+					removeData()
 					p.terminate(syscall.SIGKILL)
 				}
 			}()
@@ -298,6 +325,7 @@ If you'd like to use a TiDB version other than %s, cancel and retry with the fol
 	defaultOptions := &BootOptions{}
 
 	rootCmd.Flags().String(mode, defaultMode, "TiUP playground mode: 'tidb', 'tikv-slim'")
+	rootCmd.Flags().StringVarP(&tag, "tag", "T", "", "Specify a tag for playground")
 	rootCmd.Flags().Bool(withoutMonitor, false, "Don't start prometheus and grafana component")
 	rootCmd.Flags().Bool(withMonitor, true, "Start prometheus and grafana component")
 	_ = rootCmd.Flags().MarkDeprecated(withMonitor, "Please use --without-monitor to control whether to disable monitor.")
@@ -341,6 +369,19 @@ If you'd like to use a TiDB version other than %s, cancel and retry with the fol
 	return rootCmd.Execute()
 }
 
+func base62Tag() string {
+	const base = 62
+	const sets = "0123456789ABCDEFGHIJKLMNOPQRSTUVWXYZabcdefghijklmnopqrstuvwxyz"
+	b := make([]byte, 0)
+	num := time.Now().UnixNano() / int64(time.Millisecond)
+	for num > 0 {
+		r := math.Mod(float64(num), float64(base))
+		num /= base
+		b = append([]byte{sets[int(r)]}, b...)
+	}
+	return string(b)
+}
+
 func populateOpt(flagSet *pflag.FlagSet) (err error) {
 	var modeVal string
 	if modeVal, err = flagSet.GetString(mode); err != nil {
@@ -613,9 +654,6 @@ func newEtcdClient(endpoint string) (*clientv3.Client, error) {
 }
 
 func main() {
-	dataDir := os.Getenv(localdata.EnvNameInstanceDataDir)
-	instanceName := dataDir[strings.LastIndex(dataDir, "/")+1:]
-	fmt.Printf("\033]0;TiUP Playground: %s\a", instanceName)
 	start := time.Now()
 	code := 0
 	err := execute()
@@ -672,3 +710,10 @@ func main() {
 		os.Exit(code)
 	}
 }
+
+func removeData() {
+	// remove if not set tag when run at standalone mode
+	if tiupDataDir == "" && tag == "" {
+		os.RemoveAll(dataDir)
+	}
+}
diff --git a/pkg/exec/run.go b/pkg/exec/run.go
index 4470e18b8b..0d196148ac 100644
--- a/pkg/exec/run.go
+++ b/pkg/exec/run.go
@@ -217,17 +217,24 @@ func PrepareCommand(p *PrepareCommandParams) (*exec.Cmd, error) {
 		return nil, err
 	}
 
+	tiupWd, err := os.Getwd()
+	if err != nil {
+		return nil, err
+	}
+
 	envs := []string{
 		fmt.Sprintf("%s=%s", localdata.EnvNameHome, profile.Root()),
 		fmt.Sprintf("%s=%s", localdata.EnvNameUserInputVersion, p.Version.String()),
 		fmt.Sprintf("%s=%s", localdata.EnvNameTiUPVersion, version.NewTiUPVersion().SemVer()),
-		fmt.Sprintf("%s=%s", localdata.EnvNameInstanceDataDir, p.InstanceDir),
 		fmt.Sprintf("%s=%s", localdata.EnvNameComponentDataDir, sd),
 		fmt.Sprintf("%s=%s", localdata.EnvNameComponentInstallDir, installPath),
 		fmt.Sprintf("%s=%s", localdata.EnvNameTelemetryStatus, teleMeta.Status),
 		fmt.Sprintf("%s=%s", localdata.EnvNameTelemetryUUID, teleMeta.UUID),
 		fmt.Sprintf("%s=%s", localdata.EnvNameTelemetrySecret, teleMeta.Secret),
+		// to be removed in TiUP 2.0
+		fmt.Sprintf("%s=%s", localdata.EnvNameWorkDir, tiupWd),
 		fmt.Sprintf("%s=%s", localdata.EnvTag, p.Tag),
+		fmt.Sprintf("%s=%s", localdata.EnvNameInstanceDataDir, p.InstanceDir),
 	}
 	envs = append(envs, os.Environ()...)
 	envs = append(envs, p.EnvVariables...)
diff --git a/pkg/localdata/constant.go b/pkg/localdata/constant.go
index 4ea3dac28f..eb843658d9 100644
--- a/pkg/localdata/constant.go
+++ b/pkg/localdata/constant.go
@@ -54,6 +54,9 @@ const (
 	// EnvNameComponentInstallDir represents the install directory of specific component
 	EnvNameComponentInstallDir = "TIUP_COMPONENT_INSTALL_DIR"
 
+	// EnvNameWorkDir represents the work directory of TiUP where user type the command `tiup xxx`
+	EnvNameWorkDir = "TIUP_WORK_DIR"
+
 	// EnvNameUserInputVersion represents the version user specified when running a component by `tiup component:version`
 	EnvNameUserInputVersion = "TIUP_USER_INPUT_VERSION"