diff --git a/clang-tools-extra/clangd/ClangdLSPServer.cpp b/clang-tools-extra/clangd/ClangdLSPServer.cpp
--- a/clang-tools-extra/clangd/ClangdLSPServer.cpp
+++ b/clang-tools-extra/clangd/ClangdLSPServer.cpp
@@ -459,6 +459,9 @@
          "no longer supported. Migrate to standard semanticTokens request");
   }
 
+  // Must be initialized before creating a ClangdServer object!
+  Opts.LineFoldingOnly = Params.capabilities.LineFoldingOnly;
+
   if (Params.rootUri && *Params.rootUri)
     Opts.WorkspaceRoot = std::string(Params.rootUri->file());
   else if (Params.rootPath && !Params.rootPath->empty())
@@ -514,7 +517,6 @@
       Params.capabilities.HierarchicalDocumentSymbol;
   SupportFileStatus = Params.initializationOptions.FileStatus;
   HoverContentFormat = Params.capabilities.HoverContentFormat;
-  Opts.LineFoldingOnly = Params.capabilities.LineFoldingOnly;
   SupportsOffsetsInSignatureHelp = Params.capabilities.OffsetsInSignatureHelp;
   if (Params.capabilities.WorkDoneProgress)
     BackgroundIndexProgressState = BackgroundIndexProgress::Empty;
diff --git a/clang-tools-extra/clangd/test/folding-range.test b/clang-tools-extra/clangd/test/folding-range.test
new file mode 100644
--- /dev/null
+++ b/clang-tools-extra/clangd/test/folding-range.test
@@ -0,0 +1,24 @@
+# RUN: clangd -lit-test < %s | FileCheck -strict-whitespace %s
+void f() {
+
+}
+---
+{"jsonrpc":"2.0","id":0,"method":"initialize","params":{"processId":123,"rootPath":"clangd","capabilities":{"textDocument": {"foldingRange": {"lineFoldingOnly": true}}},"trace":"off"}}
+---
+{"jsonrpc":"2.0","method":"textDocument/didOpen","params":{"textDocument":{"languageId":"cpp","text":"void f() {\n\n}\n","uri":"test:///foo.cpp","version":1}}}
+---
+{"id":1,"jsonrpc":"2.0","method":"textDocument/foldingRange","params":{"textDocument":{"uri":"test:///foo.cpp"}}}
+# CHECK:      "id": 1,
+# CHECK-NEXT: "jsonrpc": "2.0",
+# CHECK-NEXT: "result": [
+# CHECK-NEXT:   {
+# CHECK-NEXT:     "endLine": 1,
+# CHECK-NEXT:     "kind": "region", 
+# CHECK-NEXT:     "startCharacter": 10,
+# CHECK-NEXT:     "startLine": 0
+# CHECK-NEXT:   }
+# CHECK-NEXT: ]
+---
+{"jsonrpc":"2.0","id":5,"method":"shutdown"}
+---
+{"jsonrpc":"2.0","method":"exit"}