How to run docker-compose inside docker in docker which runs inside gitlab-runner container?

In order to have docker-compose, you need to install it for image docker, which is of version 18.09.6, build 481bc77 at the time of writing.

Since docker-compose version 1.24.0, you also need the following dependencies for docker-compose to be installed on alpine:

apk add py-pip python3-dev libffi-dev openssl-dev gcc libc-dev make

Here is a sample .gitlab-ci.yml:

image: docker:stable

stages:
    - deploy

services:
  - docker:dind

before_script:
  - apk update
  - apk add py-pip python3-dev libffi-dev openssl-dev gcc libc-dev make
  - pip install docker-compose

deploy_app:
    stage: deploy
    script:
        - docker-compose down
        - docker-compose up -d

if you are using dind it means docker is working OK, now you just have to install docker-compose that is just simple python package and you can do it in before_script

.gitlab-ci.yml

image: docker:latest

services:
  - docker:dind

variables:
  DOCKER_DRIVER: overlay2

stages:
- test

before_script:
  - apk add --no-cache py-pip
  - pip install docker-compose
  - docker info
  - docker login -u gitlab-ci-token -p $CI_JOB_TOKEN docker.registry.com

test:
  stage: test
  script:

    - cp .env.sample .env # copy environement variable
    - docker-compose up -d
    # run some test here