diff --git a/services/web/app/coffee/Features/Editor/EditorController.coffee b/services/web/app/coffee/Features/Editor/EditorController.coffee
index a5dffc961f..19e9d98da5 100644
--- a/services/web/app/coffee/Features/Editor/EditorController.coffee
+++ b/services/web/app/coffee/Features/Editor/EditorController.coffee
@@ -163,7 +163,7 @@ module.exports = EditorController =
 		logger.log sl_req_id:sl_req_id, "sending new doc to project #{project_id}"
 		Metrics.inc "editor.add-doc"
 		ProjectEntityHandler.addDoc project_id, folder_id, docName, docLines, sl_req_id, (err, doc, folder_id)=>
-			EditorRealTimeController.emitToRoom(project_id, 'docCreated', folder_id, doc)
+			EditorRealTimeController.emitToRoom(project_id, 'reciveNewDoc', folder_id, doc)
 			callback(err, doc)
 
 	addFile: (project_id, folder_id, fileName, path, sl_req_id, callback = (error, file)->)->
diff --git a/services/web/app/coffee/Features/Editor/EditorHttpController.coffee b/services/web/app/coffee/Features/Editor/EditorHttpController.coffee
index 94daaf340f..33bd97633f 100644
--- a/services/web/app/coffee/Features/Editor/EditorHttpController.coffee
+++ b/services/web/app/coffee/Features/Editor/EditorHttpController.coffee
@@ -20,6 +20,7 @@ module.exports = EditorHttpController =
 				doc_id: doc._id
 			}
 
+
 	addDoc: (req, res, next) ->
 		project_id = req.params.Project_id
 		name = req.body.name
@@ -27,3 +28,11 @@ module.exports = EditorHttpController =
 		EditorController.addDoc project_id, parent_folder_id, name, [], (error, doc) ->
 			return next(error) if error?
 			res.json doc
+
+	addFolder: (req, res, next) ->
+		project_id = req.params.Project_id
+		name = req.body.name
+		parent_folder_id = req.body.parent_folder_id
+		EditorController.addFolder project_id, parent_folder_id, name, (error, doc) ->
+			return next(error) if error?
+			res.json doc
diff --git a/services/web/app/coffee/router.coffee b/services/web/app/coffee/router.coffee
index 965ff54fba..7f5439a3da 100644
--- a/services/web/app/coffee/router.coffee
+++ b/services/web/app/coffee/router.coffee
@@ -88,6 +88,7 @@ module.exports = class Router
 		app.get  '/Project/:Project_id/file/:File_id', SecurityManager.requestCanAccessProject, FileStoreController.getFile
 
 		app.post '/project/:Project_id/doc', SecurityManager.requestCanModifyProject, EditorHttpController.addDoc
+		app.post '/project/:Project_id/folder', SecurityManager.requestCanModifyProject, EditorHttpController.addFolder
 
 		app.post '/project/:Project_id/compile', SecurityManager.requestCanAccessProject, CompileController.compile
 		app.get  '/Project/:Project_id/output/output.pdf', SecurityManager.requestCanAccessProject, CompileController.downloadPdf
diff --git a/services/web/app/views/project/editor.jade b/services/web/app/views/project/editor.jade
index e2603473b0..5e7df86ffd 100644
--- a/services/web/app/views/project/editor.jade
+++ b/services/web/app/views/project/editor.jade
@@ -49,7 +49,12 @@ block content
 						tooltip-placement="bottom"
 					)
 						i.fa.fa-file
-					a(href, tooltip="New Folder", tooltip-placement="bottom")
+					a(
+						href,
+						ng-click="openNewFolderModal()",
+						tooltip="New Folder",
+						tooltip-placement="bottom"
+					)
 						i.fa.fa-folder
 					a(href, tooltip="Upload File", tooltip-placement="bottom")
 						i.fa.fa-upload
@@ -63,7 +68,7 @@ block content
 				ul.list-unstyled.file-tree-list
 					file-entity(
 						entity="entity",
-						ng-repeat="entity in rootFolder.children | orderBy:'name'"
+						ng-repeat="entity in rootFolder.children | orderBy:[orderByFoldersFirst, 'name']"
 					)
 			.ui-layout-center
 
@@ -102,7 +107,7 @@ block content
 					span(ng-click="select()")  {{ entity.name }}
 
 				ul.list-unstyled(ng-show="expanded")
-					file-entity(entity="child", ng-repeat="child in entity.children | orderBy:'name'")
+					file-entity(entity="child", ng-repeat="child in entity.children | orderBy:[orderByFoldersFirst, 'name']")
 
 	script(type='text/ng-template', id='newDocModalTemplate')
 		.modal-header
@@ -129,6 +134,31 @@ block content
 				span(ng-hide="state.inflight") Create
 				span(ng-show="state.inflight") Creating...
 
+	script(type='text/ng-template', id='newFolderModalTemplate')
+		.modal-header
+			h3 New File
+		.modal-body
+			form(novalidate, name="newFolderForm")
+				input.form-control(
+					type="text",
+					placeholder="Folder Name",
+					required,
+					ng-model="inputs.name",
+					ng-enter="create()",
+					focus-on="open"
+				)
+		.modal-footer
+			button.btn.btn-default(
+				ng-disabled="state.inflight"
+				ng-click="cancel()"
+			) Cancel
+			button.btn.btn-primary(
+				ng-disabled="newFolderForm.$invalid || state.inflight"
+				ng-click="create()"
+			)
+				span(ng-hide="state.inflight") Create
+				span(ng-show="state.inflight") Creating...
+
 	//- #loadingScreen
 	//- 	h3 Loading...
 	//- 	p#loadingMessage Loading editor
diff --git a/services/web/public/coffee/app/ide/file-tree/FileTreeManager.coffee b/services/web/public/coffee/app/ide/file-tree/FileTreeManager.coffee
index 4958fc1665..52acc80ecd 100644
--- a/services/web/public/coffee/app/ide/file-tree/FileTreeManager.coffee
+++ b/services/web/public/coffee/app/ide/file-tree/FileTreeManager.coffee
@@ -12,8 +12,7 @@ define [
 			@_bindToSocketEvents()
 
 		_bindToSocketEvents: () ->
-			@ide.socket.on "docCreated", (parent_folder_id, doc) =>
-				console.log "Doc created", parent_folder_id, doc
+			@ide.socket.on "reciveNewDoc", (parent_folder_id, doc) =>
 				parent_folder = @findEntityById(parent_folder_id) or @$scope.rootFolder
 				@$scope.$apply () ->
 					parent_folder.children.push {
@@ -22,6 +21,25 @@ define [
 						type: "doc"
 					}
 
+			@ide.socket.on "reciveNewFile", (parent_folder_id, file) =>
+				parent_folder = @findEntityById(parent_folder_id) or @$scope.rootFolder
+				@$scope.$apply () ->
+					parent_folder.children.push {
+						name: file.name
+						id:   file._id
+						type: "file"
+					}
+
+			@ide.socket.on "reciveNewFolder", (parent_folder_id, folder) =>
+				parent_folder = @findEntityById(parent_folder_id) or @$scope.rootFolder
+				@$scope.$apply () ->
+					parent_folder.children.push {
+						name: folder.name
+						id:   folder._id
+						type: "folder"
+						children: []
+					}
+
 		findEntityById: (id) ->
 			@_findEntityByIdInFolder @$scope.rootFolder, id
 
@@ -96,7 +114,7 @@ define [
 			return null
 
 		createDocInCurrentFolder: (name, callback = (error, doc) ->) ->
-			# We'll wait for the socket.io 'createDoc' notification to actually
+			# We'll wait for the socket.io notification to actually
 			# add the doc for us.
 			parent_folder = @getCurrentFolder()
 			$.ajax {
@@ -110,7 +128,25 @@ define [
 				}
 				dataType: "json"
 				success: (doc) ->
-					console.log "Got doc from POST", doc
 					callback(null, doc)
 				failure: (error) -> callback(error)
 			}
+
+		createFolderInCurrentFolder: (name, callback = (error, doc) ->) ->
+			# We'll wait for the socket.io notification to actually
+			# add the folder for us.
+			parent_folder = @getCurrentFolder()
+			$.ajax {
+				url:  "/project/#{@ide.project_id}/folder"
+				type: "POST"
+				contentType: "application/json; charset=utf-8"
+				data: JSON.stringify {
+					name: name,
+					parent_folder_id: parent_folder?.id
+					_csrf: window.csrfToken
+				}
+				dataType: "json"
+				success: (folder) ->
+					callback(null, folder)
+				failure: (error) -> callback(error)
+			}
diff --git a/services/web/public/coffee/app/ide/file-tree/controllers/FileTreeController.coffee b/services/web/public/coffee/app/ide/file-tree/controllers/FileTreeController.coffee
index efdb769a77..f5bf3c889e 100644
--- a/services/web/public/coffee/app/ide/file-tree/controllers/FileTreeController.coffee
+++ b/services/web/public/coffee/app/ide/file-tree/controllers/FileTreeController.coffee
@@ -5,8 +5,18 @@ define [
 		$scope.openNewDocModal = () ->
 			$modal.open(
 				templateUrl: "newDocModalTemplate"
-				controller: "NewDocModalController"
+				controller:  "NewDocModalController"
 			)
+
+		$scope.openNewFolderModal = () ->
+			$modal.open(
+				templateUrl: "newFolderModalTemplate"
+				controller:  "NewFolderModalController"
+			)
+
+		$scope.orderByFoldersFirst = (entity) ->
+			return 0 if entity.type == "folder"
+			return 1
 	]
 
 	App.controller "NewDocModalController", [
@@ -28,6 +38,29 @@ define [
 					$scope.state.inflight = false
 					$modalInstance.close()
 
+			$scope.cancel = () ->
+				$modalInstance.dismiss('cancel')
+	]
+
+	App.controller "NewFolderModalController", [
+		"$scope", "ide", "$modalInstance", "$timeout",
+		($scope,   ide,   $modalInstance,   $timeout) ->
+			$scope.inputs = 
+				name: "name"
+			$scope.state =
+				inflight: false
+
+			$modalInstance.opened.then () ->
+				$timeout () ->
+					$scope.$broadcast "open"
+				, 700
+
+			$scope.create = () ->
+				$scope.state.inflight = true
+				ide.fileTreeManager.createFolderInCurrentFolder $scope.inputs.name, (error, doc) ->
+					$scope.state.inflight = false
+					$modalInstance.close()
+
 			$scope.cancel = () ->
 				$modalInstance.dismiss('cancel')
 	]
\ No newline at end of file
diff --git a/services/web/test/UnitTests/coffee/Editor/EditorHttpControllerTests.coffee b/services/web/test/UnitTests/coffee/Editor/EditorHttpControllerTests.coffee
index 3dc2d33a26..f2facd0876 100644
--- a/services/web/test/UnitTests/coffee/Editor/EditorHttpControllerTests.coffee
+++ b/services/web/test/UnitTests/coffee/Editor/EditorHttpControllerTests.coffee
@@ -68,3 +68,24 @@ describe "EditorHttpController", ->
 				.calledWith(@doc)
 				.should.equal true
 
+	describe "addFolder", ->
+		beforeEach ->
+			@folder = { "mock": "folder" }
+			@req.params =
+				Project_id: @project_id
+			@req.body =
+				name: @name = "folder-name"
+				parent_folder_id: @parent_folder_id
+			@EditorController.addFolder = sinon.stub().callsArgWith(3, null, @folder)
+			@EditorHttpController.addFolder @req, @res
+
+		it "should call EditorController.addFolder", ->
+			@EditorController.addFolder
+				.calledWith(@project_id, @parent_folder_id, @name)
+				.should.equal true
+
+		it "should send the folder back as JSON", ->
+			@res.json
+				.calledWith(@folder)
+				.should.equal true
+