diff --git a/CHANGELOG.md b/CHANGELOG.md
index d7782a5c..b5a07828 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -31,6 +31,10 @@ Making a new release? Simply add the new header with the version and date undern
 
 ## Unreleased
 
+* Fixed a bug where `$path` in an instance description couldn't reference an init script directly (i.e init.luau, init.sever.luau, etc). ([#1285])
+
+[#1285]: https://github.com/rojo-rbx/rojo/pull/1285
+
 ## [7.7.1] (October 1st, 2026)
 
 * Fixed `$path` values that point outside the project folder failing to match `syncRule`s on Windows, which broke `rojo sourcemap` with a "could not be turned into a Roblox Instance" error. ([#1290])
diff --git a/rojo-test/build-test-snapshots/end_to_end__tests__build__init_from_path.snap b/rojo-test/build-test-snapshots/end_to_end__tests__build__init_from_path.snap
new file mode 100644
index 00000000..7f446250
--- /dev/null
+++ b/rojo-test/build-test-snapshots/end_to_end__tests__build__init_from_path.snap
@@ -0,0 +1,18 @@
+---
+source: tests/tests/build.rs
+expression: contents
+---
+<roblox version="4">
+  <Item class="Folder" referent="0">
+    <Properties>
+      <string name="Name">init_from_path</string>
+    </Properties>
+    <Item class="ModuleScript" referent="1">
+      <Properties>
+        <string name="Name">folder</string>
+        <string name="Source"><![CDATA[-- init.luau
+]]></string>
+      </Properties>
+    </Item>
+  </Item>
+</roblox>
diff --git a/rojo-test/build-tests/init_from_path/default.project.json b/rojo-test/build-tests/init_from_path/default.project.json
new file mode 100644
index 00000000..aecd9d65
--- /dev/null
+++ b/rojo-test/build-tests/init_from_path/default.project.json
@@ -0,0 +1,9 @@
+{
+  "name": "init_from_path",
+  "tree": {
+    "$className": "Folder",
+    "folder": {
+      "$path": "folder/init.luau"
+    }
+  }
+}
\ No newline at end of file
diff --git a/rojo-test/build-tests/init_from_path/folder/ignore_me.luau b/rojo-test/build-tests/init_from_path/folder/ignore_me.luau
new file mode 100644
index 00000000..0b5801fc
--- /dev/null
+++ b/rojo-test/build-tests/init_from_path/folder/ignore_me.luau
@@ -0,0 +1 @@
+-- ignore_me.luau
diff --git a/rojo-test/build-tests/init_from_path/folder/init.luau b/rojo-test/build-tests/init_from_path/folder/init.luau
new file mode 100644
index 00000000..bbc821f4
--- /dev/null
+++ b/rojo-test/build-tests/init_from_path/folder/init.luau
@@ -0,0 +1 @@
+-- init.luau
diff --git a/src/snapshot_middleware/dir.rs b/src/snapshot_middleware/dir.rs
index b9f62743..2ff0b6bf 100644
--- a/src/snapshot_middleware/dir.rs
+++ b/src/snapshot_middleware/dir.rs
@@ -51,7 +51,7 @@ pub fn snapshot_dir_no_meta(
     for entry in vfs.read_dir(path)? {
         let entry = entry?;
 
-        if !passes_filter_rules(&entry) {
+        if !passes_filter_rules(&entry) || is_init_file(entry.path()).unwrap() {
             continue;
         }
 
@@ -221,6 +221,21 @@ pub fn syncback_dir_no_meta<'sync>(
     })
 }
 
+fn is_init_file(path: &Path) -> anyhow::Result<bool> {
+    let file_name = path
+        .file_name()
+        .and_then(|n| n.to_str())
+        .with_context(|| format!("file name of {} is invalid", path.display()))?;
+
+    match file_name {
+        "init.server.luau" | "init.server.lua" | "init.client.luau" | "init.client.lua"
+        | "init.plugin.luau" | "init.plugin.lua" | "init.luau" | "init.lua" | "init.csv" => {
+            Ok(true)
+        }
+        _ => Ok(false),
+    }
+}
+
 #[cfg(test)]
 mod test {
     use super::*;
diff --git a/src/snapshot_middleware/mod.rs b/src/snapshot_middleware/mod.rs
index fadce5f6..b2c6faaf 100644
--- a/src/snapshot_middleware/mod.rs
+++ b/src/snapshot_middleware/mod.rs
@@ -72,32 +72,18 @@ pub fn snapshot_from_vfs(
         None => return Ok(None),
     };
 
-    if meta.is_dir() {
-        let (middleware, dir_name, init_path) = get_dir_middleware(vfs, path)?;
-        // TODO: Support user defined init paths
-        // If and when we do, make sure to go support it in
-        // `Project::set_file_name`, as right now it special-cases
-        // `default.project.json` as an `init` path.
-        match middleware {
-            Middleware::Dir => middleware.snapshot(context, vfs, path, dir_name),
-            _ => middleware.snapshot(context, vfs, &init_path, dir_name),
-        }
-    } else {
-        let file_name = path
-            .file_name()
-            .and_then(|n| n.to_str())
-            .with_context(|| format!("file name of {} is invalid", path.display()))?;
+    if !meta.is_dir() {
+        return snapshot_from_path(context, vfs, path);
+    }
 
-        // TODO: Is this even necessary anymore?
-        match file_name {
-            "init.server.luau" | "init.server.lua" | "init.client.luau" | "init.client.lua"
-            | "init.plugin.luau" | "init.plugin.lua" | "init.luau" | "init.lua" | "init.csv" => {
-                return Ok(None)
-            }
-            _ => {}
-        }
-
-        snapshot_from_path(context, vfs, path)
+    let (middleware, dir_name, init_path) = get_dir_middleware(vfs, path)?;
+    // TODO: Support user defined init paths
+    // If and when we do, make sure to go support it in
+    // `Project::set_file_name`, as right now it special-cases
+    // `default.project.json` as an `init` path.
+    match middleware {
+        Middleware::Dir => middleware.snapshot(context, vfs, path, dir_name),
+        _ => middleware.snapshot(context, vfs, &init_path, dir_name),
     }
 }
 
diff --git a/tests/tests/build.rs b/tests/tests/build.rs
index c7873050..56315e42 100644
--- a/tests/tests/build.rs
+++ b/tests/tests/build.rs
@@ -66,6 +66,7 @@ gen_build_tests! {
     no_name_project,
     no_name_top_level_project,
     plugin_init,
+    init_from_path,
 }
 
 fn run_build_test(test_name: &str) {