diff --git a/CHANGELOG.md b/CHANGELOG.md
index 7e44aed9..8be9b575 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -31,6 +31,18 @@ Making a new release? Simply add the new header with the version and date undern
 
 ## Unreleased
 
+* Add VFS recording mode and non-recursive watch support to reduce OS file-watch handles during `atlas serve` startup on large projects
+* Enhance scripts-only mode to filter non-script files at the snapshot middleware, VFS event, and prefetch layers
+* Set `core.longpaths` git config during repository initialization for Windows long-path support
+
+<details>
+<summary>Full commit log</summary>
+
+- `2ea1d493` Enhance VFS watch functionality and introduce recording mode
+- `bfb5815f` Update TODO and enhance git configuration
+
+</details>
+
 ## [8.5.2] (March 3rd, 2026)
 
 * Fix `atlas init` to commit project files before adding agent submodules, producing cleaner git history
diff --git a/crates/memofs/src/in_memory_fs.rs b/crates/memofs/src/in_memory_fs.rs
index 9ac1041d..2ce1c658 100644
--- a/crates/memofs/src/in_memory_fs.rs
+++ b/crates/memofs/src/in_memory_fs.rs
@@ -241,7 +241,7 @@ impl VfsBackend for InMemoryFs {
         inner.event_receiver.clone()
     }
 
-    fn watch(&mut self, _path: &Path) -> io::Result<()> {
+    fn watch(&mut self, _path: &Path, _recursive: bool) -> io::Result<()> {
         Ok(())
     }
 
diff --git a/crates/memofs/src/lib.rs b/crates/memofs/src/lib.rs
index 3109d235..12ecd08e 100644
--- a/crates/memofs/src/lib.rs
+++ b/crates/memofs/src/lib.rs
@@ -22,7 +22,7 @@ mod noop_backend;
 mod snapshot;
 mod std_backend;
 
-use std::collections::HashMap;
+use std::collections::{HashMap, HashSet};
 use std::path::{Path, PathBuf};
 use std::sync::{Arc, Mutex, MutexGuard};
 use std::{io, str};
@@ -94,7 +94,7 @@ pub trait VfsBackend: sealed::Sealed + Send + 'static {
     fn remove_dir_all(&mut self, path: &Path) -> io::Result<()>;
 
     fn event_receiver(&self) -> crossbeam_channel::Receiver<VfsEvent>;
-    fn watch(&mut self, path: &Path) -> io::Result<()>;
+    fn watch(&mut self, path: &Path, recursive: bool) -> io::Result<()>;
     fn unwatch(&mut self, path: &Path) -> io::Result<()>;
 }
 
@@ -159,17 +159,28 @@ pub enum VfsEvent {
 struct VfsInner {
     backend: Box<dyn VfsBackend>,
     watch_enabled: bool,
+    watch_recursive: bool,
     prefetch_cache: Option<PrefetchCache>,
+    recorded_watch_paths: Option<HashSet<PathBuf>>,
 }
 
 impl VfsInner {
+    fn watch_or_record(&mut self, path: &Path) -> io::Result<()> {
+        if let Some(ref mut recorded) = self.recorded_watch_paths {
+            recorded.insert(path.to_path_buf());
+            Ok(())
+        } else {
+            self.backend.watch(path, self.watch_recursive)
+        }
+    }
+
     /// Read raw bytes from the prefetch cache or the backend.
     /// Removes the entry from the cache on hit to free memory.
     fn read_raw(&mut self, path: &Path) -> io::Result<Vec<u8>> {
         if let Some(cache) = &mut self.prefetch_cache {
             if let Some(contents) = cache.files.remove(path) {
-                if self.watch_enabled {
-                    self.backend.watch(path)?;
+                if self.watch_enabled && self.watch_recursive {
+                    self.watch_or_record(path)?;
                 }
                 return Ok(contents);
             }
@@ -177,8 +188,8 @@ impl VfsInner {
 
         let contents = self.backend.read(path)?;
 
-        if self.watch_enabled {
-            self.backend.watch(path)?;
+        if self.watch_enabled && self.watch_recursive {
+            self.watch_or_record(path)?;
         }
 
         Ok(contents)
@@ -220,7 +231,7 @@ impl VfsInner {
         if let Some(cache) = &mut self.prefetch_cache {
             if let Some(child_paths) = cache.children.remove(path) {
                 if self.watch_enabled {
-                    self.backend.watch(path)?;
+                    self.watch_or_record(path)?;
                 }
                 let inner = child_paths.into_iter().map(|p| Ok(DirEntry { path: p }));
                 return Ok(ReadDir {
@@ -232,7 +243,7 @@ impl VfsInner {
         let dir = self.backend.read_dir(path)?;
 
         if self.watch_enabled {
-            self.backend.watch(path)?;
+            self.watch_or_record(path)?;
         }
 
         Ok(dir)
@@ -345,7 +356,9 @@ impl Vfs {
         let lock = VfsInner {
             backend: Box::new(backend),
             watch_enabled: true,
+            watch_recursive: true,
             prefetch_cache: None,
+            recorded_watch_paths: None,
         };
 
         Self {
@@ -388,6 +401,36 @@ impl Vfs {
         inner.watch_enabled = enabled;
     }
 
+    /// Sets whether new watches use recursive or non-recursive mode.
+    ///
+    /// When false, each `backend.watch()` call only watches the specific
+    /// directory -- not its children. This allows selective watching where
+    /// only directories actually traversed during snapshot get OS handles.
+    pub fn set_watch_recursive(&self, recursive: bool) {
+        let mut inner = self.inner.lock().unwrap();
+        inner.watch_recursive = recursive;
+    }
+
+    /// Begin recording mode: `read`/`read_dir` calls record touched paths
+    /// into an internal set instead of calling `backend.watch()`.
+    pub fn start_watch_recording(&self) {
+        let mut inner = self.inner.lock().unwrap();
+        inner.recorded_watch_paths = Some(HashSet::new());
+    }
+
+    /// End recording mode and return the set of paths that were touched.
+    pub fn take_recorded_paths(&self) -> Option<HashSet<PathBuf>> {
+        let mut inner = self.inner.lock().unwrap();
+        inner.recorded_watch_paths.take()
+    }
+
+    /// Explicitly watch a path using the current `watch_recursive` setting.
+    pub fn watch<P: AsRef<Path>>(&self, path: P) -> io::Result<()> {
+        let mut inner = self.inner.lock().unwrap();
+        let recursive = inner.watch_recursive;
+        inner.backend.watch(path.as_ref(), recursive)
+    }
+
     /// Read a file from the VFS, or the underlying backend if it isn't
     /// resident.
     ///
@@ -767,6 +810,50 @@ mod test {
         assert_eq!(vfs.read("test").unwrap().as_slice(), b"data");
     }
 
+    #[test]
+    fn recording_mode_collects_read_dir_paths() {
+        let mut imfs = InMemoryFs::new();
+        imfs.load_snapshot(
+            "/root",
+            VfsSnapshot::dir(HashMap::from([
+                ("child.txt", VfsSnapshot::file("hello")),
+                (
+                    "subdir",
+                    VfsSnapshot::dir(HashMap::from([("nested.txt", VfsSnapshot::file("world"))])),
+                ),
+            ])),
+        )
+        .unwrap();
+
+        let vfs = Vfs::new(imfs);
+        vfs.start_watch_recording();
+
+        let _ = vfs.read_dir("/root").unwrap();
+        let _ = vfs.read_dir("/root/subdir").unwrap();
+        let _ = vfs.read("/root/child.txt").unwrap();
+
+        let recorded = vfs.take_recorded_paths().unwrap();
+        assert!(recorded.contains(&PathBuf::from("/root")));
+        assert!(recorded.contains(&PathBuf::from("/root/subdir")));
+        assert!(recorded.contains(&PathBuf::from("/root/child.txt")));
+    }
+
+    #[test]
+    fn recording_mode_returns_none_when_not_started() {
+        let imfs = InMemoryFs::new();
+        let vfs = Vfs::new(imfs);
+        assert!(vfs.take_recorded_paths().is_none());
+    }
+
+    #[test]
+    fn recording_mode_cleared_after_take() {
+        let imfs = InMemoryFs::new();
+        let vfs = Vfs::new(imfs);
+        vfs.start_watch_recording();
+        let _ = vfs.take_recorded_paths();
+        assert!(vfs.take_recorded_paths().is_none());
+    }
+
     #[test]
     fn prefetch_cache_watch_registered_on_cache_hit() {
         let contents = "hello world".to_string();
@@ -779,7 +866,6 @@ mod test {
         cache_files.insert(file_path.clone(), contents.as_bytes().to_vec());
         vfs.set_prefetch_cache(PrefetchCache {
             files: cache_files,
-            canonical: HashMap::new(),
             is_file: HashMap::new(),
             children: HashMap::new(),
         });
@@ -825,7 +911,6 @@ mod test {
         let vfs = Arc::new(Vfs::new(StdBackend::new_for_testing()));
         vfs.set_prefetch_cache(PrefetchCache {
             files: cache_files,
-            canonical: HashMap::new(),
             is_file: HashMap::new(),
             children: HashMap::new(),
         });
diff --git a/crates/memofs/src/noop_backend.rs b/crates/memofs/src/noop_backend.rs
index 98b86d1a..90ac01c3 100644
--- a/crates/memofs/src/noop_backend.rs
+++ b/crates/memofs/src/noop_backend.rs
@@ -54,7 +54,7 @@ impl VfsBackend for NoopBackend {
         crossbeam_channel::never()
     }
 
-    fn watch(&mut self, _path: &Path) -> io::Result<()> {
+    fn watch(&mut self, _path: &Path, _recursive: bool) -> io::Result<()> {
         Err(io::Error::other("NoopBackend doesn't do anything"))
     }
 
diff --git a/crates/memofs/src/std_backend.rs b/crates/memofs/src/std_backend.rs
index 49f55539..f3c2c145 100644
--- a/crates/memofs/src/std_backend.rs
+++ b/crates/memofs/src/std_backend.rs
@@ -58,6 +58,7 @@ pub struct StdBackend {
     debouncer: Debouncer<notify::RecommendedWatcher, RecommendedCache>,
     watcher_receiver: Receiver<VfsEvent>,
     watches: HashSet<PathBuf>,
+    recursive_watches: HashSet<PathBuf>,
     /// Receiver for critical errors from the watcher thread.
     /// Callers should poll this to detect when watching becomes unreliable.
     critical_error_receiver: Receiver<WatcherCriticalError>,
@@ -113,6 +114,7 @@ impl StdBackend {
             debouncer,
             watcher_receiver: event_rx,
             watches: HashSet::new(),
+            recursive_watches: HashSet::new(),
             critical_error_receiver: error_rx,
         }
     }
@@ -328,26 +330,47 @@ impl VfsBackend for StdBackend {
         self.watcher_receiver.clone()
     }
 
-    fn watch(&mut self, path: &Path) -> io::Result<()> {
-        if self.watches.contains(path)
-            || path
-                .ancestors()
-                .any(|ancestor| self.watches.contains(ancestor))
+    fn watch(&mut self, path: &Path, recursive: bool) -> io::Result<()> {
+        if self.watches.contains(path) {
+            if !recursive || self.recursive_watches.contains(path) {
+                return Ok(());
+            }
+            // Upgrade: path was watched non-recursively, now needs recursive.
+            // Fall through to re-issue the watch with RecursiveMode::Recursive.
+        }
+        if path
+            .ancestors()
+            .skip(1)
+            .any(|ancestor| self.recursive_watches.contains(ancestor))
         {
-            Ok(())
+            return Ok(());
+        }
+
+        let mode = if recursive {
+            RecursiveMode::Recursive
         } else {
-            // Only add to watches AFTER the watch succeeds
-            // This prevents a failed watch from permanently marking the path as "watched"
-            match self.debouncer.watch(path, RecursiveMode::Recursive) {
-                Ok(()) => {
-                    log::debug!("Watching path: {}", path.display());
-                    self.watches.insert(path.to_path_buf());
-                    Ok(())
-                }
-                Err(err) => {
-                    log::warn!("Failed to watch path {}: {:?}", path.display(), err);
-                    Err(io::Error::other(format!("{:?}", err)))
+            RecursiveMode::NonRecursive
+        };
+        match self.debouncer.watch(path, mode) {
+            Ok(()) => {
+                log::debug!(
+                    "Watching path ({}): {}",
+                    if recursive {
+                        "recursive"
+                    } else {
+                        "non-recursive"
+                    },
+                    path.display()
+                );
+                self.watches.insert(path.to_path_buf());
+                if recursive {
+                    self.recursive_watches.insert(path.to_path_buf());
                 }
+                Ok(())
+            }
+            Err(err) => {
+                log::warn!("Failed to watch path {}: {:?}", path.display(), err);
+                Err(io::Error::other(format!("{:?}", err)))
             }
         }
     }
@@ -366,6 +389,7 @@ impl VfsBackend for StdBackend {
                     );
                 }
                 self.watches.remove(path);
+                self.recursive_watches.remove(path);
                 Ok(())
             }
             Err(err) => {
@@ -382,6 +406,7 @@ impl VfsBackend for StdBackend {
                         path.display()
                     );
                     self.watches.remove(path);
+                    self.recursive_watches.remove(path);
                     Ok(())
                 } else {
                     log::warn!("Failed to unwatch path {}: {:?}", path.display(), err);
@@ -414,17 +439,17 @@ mod tests {
         let mut backend = StdBackend::new_for_testing();
 
         // Watch should succeed and add to internal set
-        assert!(backend.watch(&file_path).is_ok());
+        assert!(backend.watch(&file_path, true).is_ok());
 
         // Watching again should be a no-op (already watched)
-        assert!(backend.watch(&file_path).is_ok());
+        assert!(backend.watch(&file_path, true).is_ok());
 
         // Watch a non-existent path - behavior varies by platform
         // On some systems, watching a non-existent file might succeed
         // because notify watches the parent directory. We just verify
         // that calling watch doesn't panic or corrupt state.
         let nonexistent = dir.path().join("nonexistent.txt");
-        let _ = backend.watch(&nonexistent); // Result varies by platform
+        let _ = backend.watch(&nonexistent, true); // Result varies by platform
     }
 
     #[test]
@@ -451,13 +476,13 @@ mod tests {
         let mut backend = StdBackend::new_for_testing();
 
         // Watch the file
-        assert!(backend.watch(&file_path).is_ok());
+        assert!(backend.watch(&file_path, true).is_ok());
 
         // Unwatch should succeed
         assert!(backend.unwatch(&file_path).is_ok());
 
         // Should be able to watch again after unwatch
-        assert!(backend.watch(&file_path).is_ok());
+        assert!(backend.watch(&file_path, true).is_ok());
     }
 
     #[test]
@@ -471,10 +496,43 @@ mod tests {
         let mut backend = StdBackend::new_for_testing();
 
         // Watch the parent directory
-        assert!(backend.watch(&subdir).is_ok());
+        assert!(backend.watch(&subdir, true).is_ok());
 
         // Watching a file inside should be a no-op (covered by parent)
-        assert!(backend.watch(&file_path).is_ok());
+        assert!(backend.watch(&file_path, true).is_ok());
+    }
+
+    #[test]
+    fn non_recursive_watch_upgrades_to_recursive() {
+        let dir = tempdir().unwrap();
+        let subdir = dir.path().join("subdir");
+        fs_err::create_dir(&subdir).unwrap();
+        let child = subdir.join("child.txt");
+        fs_err::write(&child, "content").unwrap();
+
+        let mut backend = StdBackend::new_for_testing();
+
+        // Watch non-recursively first
+        assert!(backend.watch(&subdir, false).is_ok());
+        assert!(backend.watches.contains(subdir.as_path()));
+        assert!(!backend.recursive_watches.contains(subdir.as_path()));
+
+        // Child should NOT be covered (parent is non-recursive)
+        assert!(!subdir
+            .ancestors()
+            .skip(1)
+            .any(|a| backend.recursive_watches.contains(a)));
+
+        // Upgrade to recursive
+        assert!(backend.watch(&subdir, true).is_ok());
+        assert!(backend.recursive_watches.contains(subdir.as_path()));
+
+        // Now a child path should be recognized as covered by the recursive ancestor
+        assert!(child
+            .ancestors()
+            .skip(1)
+            .any(|a| backend.recursive_watches.contains(a)));
+        assert!(backend.watch(&child, true).is_ok());
     }
 
     #[test]
@@ -504,12 +562,12 @@ mod tests {
 
         // Rapidly cycle watch/unwatch to stress test state consistency
         for _ in 0..10 {
-            assert!(backend.watch(&file_path).is_ok());
+            assert!(backend.watch(&file_path, true).is_ok());
             assert!(backend.unwatch(&file_path).is_ok());
         }
 
         // Final watch should still work
-        assert!(backend.watch(&file_path).is_ok());
+        assert!(backend.watch(&file_path, true).is_ok());
     }
 
     #[test]
@@ -522,7 +580,7 @@ mod tests {
         let event_rx = backend.event_receiver();
 
         // Watch the directory (more reliable than watching the file directly)
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
 
         // Give the watcher time to start
         std::thread::sleep(Duration::from_millis(100));
@@ -597,7 +655,7 @@ mod tests {
 
         let mut backend = StdBackend::new_for_testing();
         let event_rx = backend.event_receiver();
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
         std::thread::sleep(Duration::from_millis(100));
 
         // Rapid modifications - 20 writes in quick succession
@@ -635,7 +693,7 @@ mod tests {
 
         let mut backend = StdBackend::new_for_testing();
         let event_rx = backend.event_receiver();
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
         std::thread::sleep(Duration::from_millis(100));
 
         // 10 cycles of create/delete
@@ -670,7 +728,7 @@ mod tests {
         let dir = tempdir().unwrap();
         let mut backend = StdBackend::new_for_testing();
         let event_rx = backend.event_receiver();
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
         std::thread::sleep(Duration::from_millis(100));
 
         // Create 20 files rapidly
@@ -722,7 +780,7 @@ mod tests {
 
         let mut backend = StdBackend::new_for_testing();
         let event_rx = backend.event_receiver();
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
         std::thread::sleep(Duration::from_millis(100));
 
         // Rename the file
@@ -758,7 +816,7 @@ mod tests {
 
         let mut backend = StdBackend::new_for_testing();
         let event_rx = backend.event_receiver();
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
         std::thread::sleep(Duration::from_millis(100));
 
         // Chain of renames
@@ -781,7 +839,7 @@ mod tests {
         let dir = tempdir().unwrap();
         let mut backend = StdBackend::new_for_testing();
         let event_rx = backend.event_receiver();
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
         std::thread::sleep(Duration::from_millis(100));
 
         // Create nested structure
@@ -826,7 +884,7 @@ mod tests {
 
         let mut backend = StdBackend::new_for_testing();
         let event_rx = backend.event_receiver();
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
         std::thread::sleep(Duration::from_millis(100));
 
         // 100 writes with no delay
@@ -863,7 +921,7 @@ mod tests {
         let dir = tempdir().unwrap();
         let mut backend = StdBackend::new_for_testing();
         let event_rx = backend.event_receiver();
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
         std::thread::sleep(Duration::from_millis(100));
 
         let files: Vec<_> = (0..5)
@@ -915,7 +973,7 @@ mod tests {
 
         let mut backend = StdBackend::new_for_testing();
         let event_rx = backend.event_receiver();
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
         std::thread::sleep(Duration::from_millis(100));
 
         // Simulate multiple undo/redo cycles
@@ -969,7 +1027,7 @@ mod tests {
         let dir = tempdir().unwrap();
         let mut backend = StdBackend::new_for_testing();
         let event_rx = backend.event_receiver();
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
         std::thread::sleep(Duration::from_millis(100));
 
         // Rapidly create subdirectories with files
@@ -1005,7 +1063,7 @@ mod tests {
 
         let mut backend = StdBackend::new_for_testing();
         let event_rx = backend.event_receiver();
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
         std::thread::sleep(Duration::from_millis(100));
 
         // Create empty file
@@ -1041,7 +1099,7 @@ mod tests {
 
         let mut backend = StdBackend::new_for_testing();
         let event_rx = backend.event_receiver();
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
         std::thread::sleep(Duration::from_millis(100));
 
         fs_err::write(&file_path, "-- long name test").unwrap();
@@ -1067,7 +1125,7 @@ mod tests {
 
         let mut backend = StdBackend::new_for_testing();
         let event_rx = backend.event_receiver();
-        assert!(backend.watch(dir.path()).is_ok());
+        assert!(backend.watch(dir.path(), true).is_ok());
         std::thread::sleep(Duration::from_millis(100));
 
         for name in &special_files {
diff --git a/src/change_processor.rs b/src/change_processor.rs
index fbe41b20..4d3b05db 100644
--- a/src/change_processor.rs
+++ b/src/change_processor.rs
@@ -16,7 +16,7 @@ use crate::{
     snapshot::{
         apply_patch_set, compute_patch_set, AppliedPatchSet, InstigatingSource, PatchSet, RojoTree,
     },
-    snapshot_middleware::{snapshot_from_vfs, snapshot_project_node},
+    snapshot_middleware::{is_script_relevant_path, snapshot_from_vfs, snapshot_project_node},
     syncback::{
         dedup_suffix::{compute_cleanup_action, parse_dedup_suffix, DedupCleanupAction},
         deduplicate_name, name_needs_slugify, slugify_name, strip_script_suffix,
@@ -92,6 +92,7 @@ impl ChangeProcessor {
         project_file_path: PathBuf,
         critical_error_receiver: Option<Receiver<memofs::WatcherCriticalError>>,
         git_repo_root: Option<PathBuf>,
+        sync_scripts_only: bool,
     ) -> Self {
         let (shutdown_sender, shutdown_receiver) = crossbeam_channel::bounded(1);
         let vfs_receiver = vfs.event_receiver();
@@ -109,6 +110,7 @@ impl ChangeProcessor {
             project_file_path,
             ref_path_index,
             git_repo_root,
+            sync_scripts_only,
         };
 
         let job_thread = jod_thread::Builder::new()
@@ -268,6 +270,9 @@ struct JobThreadContext {
     /// Git repository root, if the project is in a git repo.
     /// Used for auto-staging Source writes.
     git_repo_root: Option<PathBuf>,
+
+    /// When true, only script-related VFS events are processed.
+    sync_scripts_only: bool,
 }
 
 impl JobThreadContext {
@@ -723,6 +728,24 @@ impl JobThreadContext {
             }
         }
 
+        if self.sync_scripts_only {
+            if let Some(ref path) = event_path {
+                if path.is_file() {
+                    let not_in_tree = {
+                        let tree = self.tree.lock().unwrap();
+                        tree.get_ids_at_path(path).is_empty()
+                    };
+                    if not_in_tree && !is_script_relevant_path(path) {
+                        log::trace!(
+                            "VFS event SKIPPED (scripts-only, non-script file): {}",
+                            self.display_path(path)
+                        );
+                        return Vec::new();
+                    }
+                }
+            }
+        }
+
         // For a given VFS event, we might have many changes to different parts
         // of the tree. Calculate and apply all of these changes.
         let applied_patches = match event {
@@ -890,7 +913,8 @@ impl JobThreadContext {
         use crate::snapshot::InstanceContext;
 
         let start = Instant::now();
-        let instance_context = InstanceContext::new();
+        let mut instance_context = InstanceContext::new();
+        instance_context.sync_scripts_only = self.sync_scripts_only;
 
         let snapshot =
             match snapshot_from_vfs(&instance_context, &self.vfs, &self.project_file_path) {
diff --git a/src/serve_session.rs b/src/serve_session.rs
index 1ef4628d..60306ad0 100644
--- a/src/serve_session.rs
+++ b/src/serve_session.rs
@@ -19,7 +19,7 @@ use crate::{
         apply_patch_set, compute_patch_set, AppliedPatchSet, InstanceContext, InstanceSnapshot,
         PatchSet, RojoTree,
     },
-    snapshot_middleware::snapshot_from_vfs,
+    snapshot_middleware::{is_script_relevant_path, snapshot_from_vfs},
 };
 
 /// Set to `true` to validate on plugin connect (useful for testing, do not enable on production).
@@ -131,7 +131,7 @@ pub struct ServeSession {
 
 /// Collect all filesystem paths reachable from the project tree's `$path`
 /// entries, then read file contents in parallel.
-fn prefetch_project_files(project: &Project) -> io::Result<PrefetchCache> {
+fn prefetch_project_files(project: &Project, sync_scripts_only: bool) -> io::Result<PrefetchCache> {
     use rayon::prelude::*;
     use std::collections::HashMap;
     use walkdir::WalkDir;
@@ -200,6 +200,7 @@ fn prefetch_project_files(project: &Project) -> io::Result<PrefetchCache> {
     let file_data: Vec<_> = entries
         .par_iter()
         .filter(|e| e.file_type().is_file())
+        .filter(|e| !sync_scripts_only || is_script_relevant_path(e.path()))
         .filter_map(|e| {
             let path = e.path().to_path_buf();
             std::fs::read(&path).ok().map(|c| (path, c))
@@ -266,10 +267,11 @@ impl ServeSession {
         log::trace!("Starting new ServeSession at path {}", start_path.display());
 
         let root_project = Project::load_initial_project(vfs, start_path)?;
+        let sync_scripts_only = root_project.sync_scripts_only.unwrap_or(false);
 
         if std::env::var("ATLAS_SEQUENTIAL").is_err() {
             let prefetch_start = Instant::now();
-            match prefetch_project_files(&root_project) {
+            match prefetch_project_files(&root_project, sync_scripts_only) {
                 Ok(cache) => {
                     log::debug!(
                         "Prefetch total: {} files in {:.1?}",
@@ -286,7 +288,25 @@ impl ServeSession {
 
         let mut tree = RojoTree::new(InstanceSnapshot::new());
         let root_id = tree.get_root_id();
-        let instance_context = InstanceContext::new();
+        let mut instance_context = InstanceContext::new();
+        instance_context.sync_scripts_only = sync_scripts_only;
+
+        let watch_start = Instant::now();
+        let mut path_roots = Vec::new();
+        collect_path_roots(
+            &root_project.tree,
+            root_project.folder_location(),
+            &mut path_roots,
+        );
+        let _ = vfs.watch(root_project.folder_location());
+        for root in &path_roots {
+            let _ = vfs.watch(root);
+        }
+        log::debug!(
+            "Set up {} recursive watches in {:.1?}",
+            path_roots.len() + 1,
+            watch_start.elapsed(),
+        );
 
         let snap_start = Instant::now();
         log::trace!("Generating snapshot of instances from VFS");
@@ -356,6 +376,7 @@ impl ServeSession {
             root_project.file_location.clone(),
             critical_error_receiver,
             git_repo_root.clone(),
+            root_project.sync_scripts_only.unwrap_or(false),
         );
 
         Ok(Self {
@@ -526,7 +547,8 @@ impl ServeSession {
     pub fn check_tree_freshness(&self) -> TreeFreshnessReport {
         let start = Instant::now();
         let start_path: &Path = &self.root_project.file_location;
-        let instance_context = InstanceContext::new();
+        let mut instance_context = InstanceContext::new();
+        instance_context.sync_scripts_only = self.sync_scripts_only();
 
         let snapshot = match snapshot_from_vfs(&instance_context, &self.vfs, start_path) {
             Ok(s) => s,
@@ -589,7 +611,8 @@ impl ServeSession {
 
         let start = Instant::now();
         let start_path: &Path = &self.root_project.file_location;
-        let instance_context = InstanceContext::new();
+        let mut instance_context = InstanceContext::new();
+        instance_context.sync_scripts_only = self.sync_scripts_only();
 
         let snapshot = match snapshot_from_vfs(&instance_context, &self.vfs, start_path) {
             Ok(s) => s,
diff --git a/src/snapshot/metadata.rs b/src/snapshot/metadata.rs
index 82612f30..9fb96cce 100644
--- a/src/snapshot/metadata.rs
+++ b/src/snapshot/metadata.rs
@@ -155,6 +155,8 @@ pub struct InstanceContext {
     pub path_ignore_rules: Arc<Vec<PathIgnoreRule>>,
     #[serde(skip_serializing_if = "Vec::is_empty")]
     pub sync_rules: Vec<SyncRule>,
+    #[serde(skip)]
+    pub sync_scripts_only: bool,
 }
 
 impl InstanceContext {
@@ -162,6 +164,7 @@ impl InstanceContext {
         Self {
             path_ignore_rules: Arc::new(Vec::new()),
             sync_rules: Vec::new(),
+            sync_scripts_only: false,
         }
     }
 
diff --git a/src/snapshot_middleware/mod.rs b/src/snapshot_middleware/mod.rs
index f8ca439e..077e7f12 100644
--- a/src/snapshot_middleware/mod.rs
+++ b/src/snapshot_middleware/mod.rs
@@ -79,6 +79,13 @@ pub fn snapshot_from_vfs(
         // If and when we do, make sure to go support it in
         // `Project::set_file_name`, as right now it special-cases
         // `default.project.json5` as an `init` path.
+        if context.sync_scripts_only
+            && !middleware.is_script()
+            && middleware != Middleware::Dir
+            && middleware != Middleware::Project
+        {
+            return Ok(None);
+        }
         match middleware {
             Middleware::Dir => middleware.snapshot(context, vfs, path, dir_name),
             _ => middleware.snapshot(context, vfs, &init_path, dir_name),
@@ -168,11 +175,23 @@ fn snapshot_from_path(
     // name is needed (e.g. for names with special chars), it comes from the
     // `name` field in adjacent .meta.json / .model.json files.
     if let Some(rule) = context.get_user_sync_rule(path) {
+        if context.sync_scripts_only
+            && !rule.middleware.is_script()
+            && rule.middleware != Middleware::Project
+        {
+            return Ok(None);
+        }
         let name = rule.file_name_for_path(path)?;
         return rule.middleware.snapshot(context, vfs, path, name);
     } else {
         for rule in default_sync_rules() {
             if rule.matches(path) {
+                if context.sync_scripts_only
+                    && !rule.middleware.is_script()
+                    && rule.middleware != Middleware::Project
+                {
+                    return Ok(None);
+                }
                 let name = rule.file_name_for_path(path)?;
                 return rule.middleware.snapshot(context, vfs, path, name);
             }
@@ -319,6 +338,27 @@ impl Middleware {
         }
     }
 
+    /// Returns whether this middleware produces a script instance
+    /// (Script, LocalScript, or ModuleScript).
+    #[inline]
+    pub fn is_script(&self) -> bool {
+        matches!(
+            self,
+            Self::ServerScript
+                | Self::ClientScript
+                | Self::ModuleScript
+                | Self::PluginScript
+                | Self::LocalScript
+                | Self::LegacyScript
+                | Self::ServerScriptDir
+                | Self::ClientScriptDir
+                | Self::ModuleScriptDir
+                | Self::PluginScriptDir
+                | Self::LocalScriptDir
+                | Self::LegacyScriptDir
+        )
+    }
+
     /// Returns whether this particular middleware would become a directory.
     #[inline]
     pub fn is_dir(&self) -> bool {
@@ -454,3 +494,231 @@ pub fn default_sync_rules() -> &'static [SyncRule] {
         ]
     })
 }
+
+/// Returns whether a filesystem path is relevant in scripts-only mode.
+///
+/// Matches script files (`.luau`, `.lua`), meta files (`.meta.json5`,
+/// `.meta.json`), and project files (`.project.json5`, `.project.json`).
+pub fn is_script_relevant_path(path: &Path) -> bool {
+    let name = match path.file_name().and_then(|n| n.to_str()) {
+        Some(n) => n.to_lowercase(),
+        None => return false,
+    };
+    name.ends_with(".luau")
+        || name.ends_with(".lua")
+        || name.ends_with(".meta.json5")
+        || name.ends_with(".meta.json")
+        || name.ends_with(".project.json5")
+        || name.ends_with(".project.json")
+}
+
+#[cfg(test)]
+mod test {
+    use super::*;
+    use std::collections::HashMap;
+
+    use memofs::{InMemoryFs, VfsSnapshot};
+
+    #[test]
+    fn is_script_covers_all_script_types() {
+        assert!(Middleware::ServerScript.is_script());
+        assert!(Middleware::ClientScript.is_script());
+        assert!(Middleware::ModuleScript.is_script());
+        assert!(Middleware::PluginScript.is_script());
+        assert!(Middleware::LocalScript.is_script());
+        assert!(Middleware::LegacyScript.is_script());
+        assert!(Middleware::ServerScriptDir.is_script());
+        assert!(Middleware::ClientScriptDir.is_script());
+        assert!(Middleware::ModuleScriptDir.is_script());
+        assert!(Middleware::PluginScriptDir.is_script());
+        assert!(Middleware::LocalScriptDir.is_script());
+        assert!(Middleware::LegacyScriptDir.is_script());
+    }
+
+    #[test]
+    fn is_script_excludes_non_scripts() {
+        assert!(!Middleware::Dir.is_script());
+        assert!(!Middleware::Project.is_script());
+        assert!(!Middleware::Csv.is_script());
+        assert!(!Middleware::JsonModel.is_script());
+        assert!(!Middleware::Json.is_script());
+        assert!(!Middleware::Rbxm.is_script());
+        assert!(!Middleware::Rbxmx.is_script());
+        assert!(!Middleware::Toml.is_script());
+        assert!(!Middleware::Text.is_script());
+        assert!(!Middleware::Yaml.is_script());
+        assert!(!Middleware::Ignore.is_script());
+        assert!(!Middleware::CsvDir.is_script());
+    }
+
+    #[test]
+    fn scripts_only_skips_non_script_file() {
+        let mut imfs = InMemoryFs::new();
+        imfs.load_snapshot(
+            "/project",
+            VfsSnapshot::dir(HashMap::from([
+                ("data.json5", VfsSnapshot::file("{}")),
+                ("script.server.luau", VfsSnapshot::file("print('hi')")),
+            ])),
+        )
+        .unwrap();
+
+        let vfs = Vfs::new(imfs);
+        let mut context = InstanceContext::new();
+        context.sync_scripts_only = true;
+
+        let json_result =
+            snapshot_from_vfs(&context, &vfs, Path::new("/project/data.json5")).unwrap();
+        assert!(json_result.is_none());
+
+        let script_result =
+            snapshot_from_vfs(&context, &vfs, Path::new("/project/script.server.luau")).unwrap();
+        assert!(script_result.is_some());
+        assert_eq!(script_result.unwrap().class_name.as_str(), "Script");
+    }
+
+    #[test]
+    fn scripts_only_preserves_directories() {
+        let mut imfs = InMemoryFs::new();
+        imfs.load_snapshot(
+            "/project",
+            VfsSnapshot::dir(HashMap::from([(
+                "models",
+                VfsSnapshot::dir(HashMap::from([(
+                    "part.rbxm",
+                    VfsSnapshot::file(b"\x00".as_ref()),
+                )])),
+            )])),
+        )
+        .unwrap();
+
+        let vfs = Vfs::new(imfs);
+        let mut context = InstanceContext::new();
+        context.sync_scripts_only = true;
+
+        let result = snapshot_from_vfs(&context, &vfs, Path::new("/project/models")).unwrap();
+        assert!(result.is_some());
+        let snapshot = result.unwrap();
+        assert_eq!(snapshot.class_name.as_str(), "Folder");
+        assert!(snapshot.children.is_empty());
+    }
+
+    #[test]
+    fn scripts_only_allows_project_files() {
+        let mut imfs = InMemoryFs::new();
+        imfs.load_snapshot(
+            "/nested.project.json5",
+            VfsSnapshot::file(r#"{"name": "Nested", "tree": {"$className": "Folder"}}"#),
+        )
+        .unwrap();
+
+        let vfs = Vfs::new(imfs);
+        let mut context = InstanceContext::new();
+        context.sync_scripts_only = true;
+
+        let result = snapshot_from_vfs(&context, &vfs, Path::new("/nested.project.json5")).unwrap();
+        assert!(result.is_some());
+    }
+
+    #[test]
+    fn normal_mode_includes_all_files() {
+        let mut imfs = InMemoryFs::new();
+        imfs.load_snapshot(
+            "/project",
+            VfsSnapshot::dir(HashMap::from([
+                ("data.json5", VfsSnapshot::file("{}")),
+                ("script.server.luau", VfsSnapshot::file("print('hi')")),
+            ])),
+        )
+        .unwrap();
+
+        let vfs = Vfs::new(imfs);
+        let context = InstanceContext::new();
+
+        let json_result =
+            snapshot_from_vfs(&context, &vfs, Path::new("/project/data.json5")).unwrap();
+        assert!(json_result.is_some());
+
+        let script_result =
+            snapshot_from_vfs(&context, &vfs, Path::new("/project/script.server.luau")).unwrap();
+        assert!(script_result.is_some());
+    }
+
+    #[test]
+    fn is_script_relevant_path_accepts_scripts_and_meta() {
+        assert!(is_script_relevant_path(Path::new("/src/main.luau")));
+        assert!(is_script_relevant_path(Path::new("/src/init.server.luau")));
+        assert!(is_script_relevant_path(Path::new("/src/old.lua")));
+        assert!(is_script_relevant_path(Path::new("/src/old.server.lua")));
+        assert!(is_script_relevant_path(Path::new("/src/file.meta.json5")));
+        assert!(is_script_relevant_path(Path::new("/src/file.meta.json")));
+        assert!(is_script_relevant_path(Path::new("/nested.project.json5")));
+        assert!(is_script_relevant_path(Path::new("/nested.project.json")));
+    }
+
+    #[test]
+    fn is_script_relevant_path_rejects_non_scripts() {
+        assert!(!is_script_relevant_path(Path::new("/src/data.json5")));
+        assert!(!is_script_relevant_path(Path::new("/src/model.rbxm")));
+        assert!(!is_script_relevant_path(Path::new("/src/notes.txt")));
+        assert!(!is_script_relevant_path(Path::new("/src/table.csv")));
+        assert!(!is_script_relevant_path(Path::new("/src/config.toml")));
+        assert!(!is_script_relevant_path(Path::new("/src/data.yaml")));
+        assert!(!is_script_relevant_path(Path::new("/src/model.rbxmx")));
+        assert!(!is_script_relevant_path(Path::new("/src")));
+        assert!(!is_script_relevant_path(Path::new("/src/no_ext")));
+    }
+
+    #[test]
+    fn scripts_only_filters_csv_dir() {
+        let mut imfs = InMemoryFs::new();
+        imfs.load_snapshot(
+            "/project",
+            VfsSnapshot::dir(HashMap::from([(
+                "localization",
+                VfsSnapshot::dir(HashMap::from([(
+                    "init.csv",
+                    VfsSnapshot::file("Key,Source,Example\nkey1,Hello,Hello"),
+                )])),
+            )])),
+        )
+        .unwrap();
+
+        let vfs = Vfs::new(imfs);
+        let mut context = InstanceContext::new();
+        context.sync_scripts_only = true;
+
+        let result = snapshot_from_vfs(&context, &vfs, Path::new("/project/localization")).unwrap();
+        assert!(
+            result.is_none(),
+            "CsvDir should be filtered in scripts-only mode"
+        );
+    }
+
+    #[test]
+    fn scripts_only_preserves_script_dir() {
+        let mut imfs = InMemoryFs::new();
+        imfs.load_snapshot(
+            "/project",
+            VfsSnapshot::dir(HashMap::from([(
+                "MyScript",
+                VfsSnapshot::dir(HashMap::from([(
+                    "init.server.luau",
+                    VfsSnapshot::file("print('hello')"),
+                )])),
+            )])),
+        )
+        .unwrap();
+
+        let vfs = Vfs::new(imfs);
+        let mut context = InstanceContext::new();
+        context.sync_scripts_only = true;
+
+        let result = snapshot_from_vfs(&context, &vfs, Path::new("/project/MyScript")).unwrap();
+        assert!(
+            result.is_some(),
+            "Script dir should pass through in scripts-only mode"
+        );
+        assert_eq!(result.unwrap().class_name.as_str(), "Script");
+    }
+}