diff --git a/src/common/filesystembase.cpp b/src/common/filesystembase.cpp
index 3fc067944..ffc7bca4f 100644
--- a/src/common/filesystembase.cpp
+++ b/src/common/filesystembase.cpp
@@ -480,6 +480,11 @@ bool FileSystem::isLnkFile(const QString &filename)
     return filename.endsWith(QLatin1String(".lnk"));
 }
 
+bool FileSystem::isExcludeFile(const QString &filename)
+{
+    return filename.endsWith(QLatin1String(".sync-exclude.lst"));
+}
+
 bool FileSystem::isJunction(const QString &filename)
 {
 #ifdef Q_OS_WIN
diff --git a/src/common/filesystembase.h b/src/common/filesystembase.h
index 0259fb6c7..b15cb4fa1 100644
--- a/src/common/filesystembase.h
+++ b/src/common/filesystembase.h
@@ -153,6 +153,11 @@ namespace FileSystem {
      */
     bool OCSYNC_EXPORT isLnkFile(const QString &filename);
 
+    /**
+     * Returns whether the file is an exclude file (contains patterns to exclude from sync)
+     */
+    bool OCSYNC_EXPORT isExcludeFile(const QString &filename);
+
     /**
      * Returns whether the file is a junction (windows only)
      */
diff --git a/src/libsync/discovery.cpp b/src/libsync/discovery.cpp
index 5b0873bdd..530f67a51 100644
--- a/src/libsync/discovery.cpp
+++ b/src/libsync/discovery.cpp
@@ -521,7 +521,8 @@ void ProcessDirectoryJob::processFileAnalyzeRemoteInfo(
         if (!localEntry.isValid()
             && item->_type == ItemTypeFile
             && opts._vfs->mode() != Vfs::Off
-            && _pinState != PinState::AlwaysLocal) {
+            && _pinState != PinState::AlwaysLocal
+            && !FileSystem::isExcludeFile(item->_file)) {
             item->_type = ItemTypeVirtualFile;
             if (isVfsWithSuffix())
                 addVirtualFileSuffix(tmp_path._original);
diff --git a/src/libsync/vfs/cfapi/vfs_cfapi.cpp b/src/libsync/vfs/cfapi/vfs_cfapi.cpp
index 9a8e81353..5db9c5d03 100644
--- a/src/libsync/vfs/cfapi/vfs_cfapi.cpp
+++ b/src/libsync/vfs/cfapi/vfs_cfapi.cpp
@@ -187,6 +187,8 @@ bool VfsCfApi::statTypeVirtualFile(csync_file_stat_t *stat, void *statData)
 
     const auto isWindowsShortcut = !isDirectory && FileSystem::isLnkFile(stat->path);
 
+    const auto isExcludeFile = !isDirectory && FileSystem::isExcludeFile(stat->path);
+
     // It's a dir with a reparse point due to the placeholder info (hence the cloud tag)
     // if we don't remove the reparse point flag the discovery will end up thinking
     // it is a file... let's prevent it
@@ -198,7 +200,7 @@ bool VfsCfApi::statTypeVirtualFile(csync_file_stat_t *stat, void *statData)
     } else if (isSparseFile && isPinned) {
         stat->type = ItemTypeVirtualFileDownload;
         return true;
-    } else if (!isSparseFile && isUnpinned && !isWindowsShortcut){
+    } else if (!isSparseFile && isUnpinned && !isWindowsShortcut && !isExcludeFile) {
         stat->type = ItemTypeVirtualFileDehydration;
         return true;
     } else if (isSparseFile) {