diff --git a/src/snapshot_middleware/dir.rs b/src/snapshot_middleware/dir.rs
index b3c1a126..1a44d88a 100644
--- a/src/snapshot_middleware/dir.rs
+++ b/src/snapshot_middleware/dir.rs
@@ -4,12 +4,13 @@ use rbx_dom_weak::{RbxId, RbxTree};
 
 use crate::{
     snapshot::{InstanceMetadata, InstanceSnapshot},
-    vfs::{DirectorySnapshot, Vfs, VfsEntry, VfsFetcher, VfsSnapshot},
+    vfs::{DirectorySnapshot, FsResultExt, Vfs, VfsEntry, VfsFetcher, VfsSnapshot},
 };
 
 use super::{
     context::InstanceSnapshotContext,
     error::SnapshotError,
+    meta_file::DirectoryMetadata,
     middleware::{SnapshotFileResult, SnapshotInstanceResult, SnapshotMiddleware},
     snapshot_from_instance, snapshot_from_vfs,
 };
@@ -44,7 +45,9 @@ impl SnapshotMiddleware for SnapshotDir {
             .ok_or_else(|| SnapshotError::file_name_bad_unicode(entry.path()))?
             .to_string();
 
-        Ok(Some(InstanceSnapshot {
+        let meta_path = entry.path().join("init.meta.json");
+
+        let mut snapshot = InstanceSnapshot {
             snapshot_id: None,
             metadata: InstanceMetadata {
                 instigating_source: Some(entry.path().to_path_buf().into()),
@@ -55,7 +58,15 @@ impl SnapshotMiddleware for SnapshotDir {
             class_name: Cow::Borrowed("Folder"),
             properties: HashMap::new(),
             children: snapshot_children,
-        }))
+        };
+
+        if let Some(meta_entry) = vfs.get(meta_path).with_not_found()? {
+            let meta_contents = meta_entry.contents(vfs)?;
+            let mut metadata = DirectoryMetadata::from_slice(&meta_contents);
+            metadata.apply_all(&mut snapshot);
+        }
+
+        Ok(Some(snapshot))
     }
 
     fn from_instance(tree: &RbxTree, id: RbxId) -> SnapshotFileResult {
diff --git a/src/snapshot_middleware/lua.rs b/src/snapshot_middleware/lua.rs
index 8f3266d5..bd6c54b2 100644
--- a/src/snapshot_middleware/lua.rs
+++ b/src/snapshot_middleware/lua.rs
@@ -126,10 +126,17 @@ fn snapshot_init<F: VfsFetcher>(
     if let Some(init_entry) = vfs.get(init_path).with_not_found()? {
         if let Some(dir_snapshot) = SnapshotDir::from_vfs(context, vfs, folder_entry)? {
             if let Some(mut init_snapshot) = snapshot_lua_file(vfs, &init_entry)? {
+                if dir_snapshot.class_name != "Folder" {
+                    panic!(
+                        "init.lua, init.server.lua, and init.client.lua can \
+                         only be used if the instance produced by the parent \
+                         directory would be a Folder."
+                    );
+                }
+
                 init_snapshot.name = dir_snapshot.name;
                 init_snapshot.children = dir_snapshot.children;
-                // TODO: Metadata
-                // TODO: Validate directory class name is "Folder"
+                // TODO: Apply metadata from folder
 
                 return Ok(Some(init_snapshot));
             }
diff --git a/src/snapshot_middleware/meta_file.rs b/src/snapshot_middleware/meta_file.rs
index 9103dfc0..db8e1b40 100644
--- a/src/snapshot_middleware/meta_file.rs
+++ b/src/snapshot_middleware/meta_file.rs
@@ -1,4 +1,4 @@
-use std::collections::HashMap;
+use std::{borrow::Cow, collections::HashMap};
 
 use rbx_dom_weak::UnresolvedRbxValue;
 use rbx_reflection::try_resolve_value;
@@ -55,3 +55,65 @@ impl AdjacentMetadata {
     // TODO: Add method to allow selectively applying parts of metadata and
     // throwing errors if invalid parts are specified.
 }
+
+/// Represents metadata that affects the instance resulting from the containing
+/// folder.
+///
+/// This is always sourced from a file named init.meta.json.
+#[derive(Debug, Serialize, Deserialize)]
+#[serde(rename_all = "camelCase")]
+pub struct DirectoryMetadata {
+    #[serde(skip_serializing_if = "Option::is_none")]
+    pub ignore_unknown_instances: Option<bool>,
+
+    #[serde(default, skip_serializing_if = "HashMap::is_empty")]
+    pub properties: HashMap<String, UnresolvedRbxValue>,
+
+    #[serde(skip_serializing_if = "Option::is_none")]
+    pub class_name: Option<String>,
+}
+
+impl DirectoryMetadata {
+    pub fn from_slice(slice: &[u8]) -> Self {
+        serde_json::from_slice(slice)
+            // TODO: Turn into error type
+            .expect("init.meta.json file was malformed")
+    }
+
+    pub fn apply_all(&mut self, snapshot: &mut InstanceSnapshot) {
+        self.apply_ignore_unknown_instances(snapshot);
+        self.apply_class_name(snapshot);
+        self.apply_properties(snapshot);
+    }
+
+    fn apply_class_name(&mut self, snapshot: &mut InstanceSnapshot) {
+        if let Some(class_name) = self.class_name.take() {
+            if snapshot.class_name != "Folder" {
+                // TODO: Turn into error type
+                panic!("className in init.meta.json can only be specified if the affected directory would turn into a Folder instance.");
+            }
+
+            snapshot.class_name = Cow::Owned(class_name);
+        }
+    }
+
+    fn apply_ignore_unknown_instances(&mut self, snapshot: &mut InstanceSnapshot) {
+        if let Some(ignore) = self.ignore_unknown_instances.take() {
+            snapshot.metadata.ignore_unknown_instances = ignore;
+        }
+    }
+
+    fn apply_properties(&mut self, snapshot: &mut InstanceSnapshot) {
+        let class_name = &snapshot.class_name;
+
+        let source_properties = self.properties.drain().map(|(key, value)| {
+            try_resolve_value(class_name, &key, &value)
+                .map(|resolved| (key, resolved))
+                .expect("TODO: Handle rbx_reflection errors")
+        });
+
+        for (key, value) in source_properties {
+            snapshot.properties.insert(key, value);
+        }
+    }
+}