diff --git a/src/Umbraco.Web.UI.Client/src/views/documenttypes/create.controller.js b/src/Umbraco.Web.UI.Client/src/views/documenttypes/create.controller.js
index 9e4a804010..4e734b76a6 100644
--- a/src/Umbraco.Web.UI.Client/src/views/documenttypes/create.controller.js
+++ b/src/Umbraco.Web.UI.Client/src/views/documenttypes/create.controller.js
@@ -9,6 +9,7 @@
 function DocumentTypesCreateController($scope, $location, navigationService, contentTypeResource, formHelper, appState, notificationsService, localizationService) {
 
     $scope.model = {
+        allowCreateFolder: $scope.dialogOptions.currentNode.parentId === null || $scope.dialogOptions.currentNode.nodeType === "container",
         folderName: "",
         creatingFolder: false,
     };
@@ -18,21 +19,28 @@ function DocumentTypesCreateController($scope, $location, navigationService, con
 
     $scope.showCreateFolder = function() {
         $scope.model.creatingFolder = true;
-    }
+    };
 
-    $scope.createContainer = function () {
-        if (formHelper.submitForm({
-            scope: $scope,
-            formCtrl: this.createFolderForm,
-            statusMessage: localizeCreateFolder
-        })) {
-            contentTypeResource.createContainer(node.id, $scope.model.folderName).then(function (folderId) {
+    $scope.createContainer = function() {
+
+        if (formHelper.submitForm({scope: $scope, formCtrl: this.createFolderForm, statusMessage: localizeCreateFolder})) {
+
+            contentTypeResource.createContainer(node.id, $scope.model.folderName).then(function(folderId) {
 
                 navigationService.hideMenu();
-                var currPath = node.path ? node.path : "-1";
-                navigationService.syncTree({ tree: "documenttypes", path: currPath + "," + folderId, forceReload: true, activate: true });
 
-                formHelper.resetForm({ scope: $scope });
+                var currPath = node.path ? node.path : "-1";
+
+                navigationService.syncTree({
+                    tree: "documenttypes",
+                    path: currPath + "," + folderId,
+                    forceReload: true,
+                    activate: true
+                });
+
+                formHelper.resetForm({
+                    scope: $scope
+                });
 
                 var section = appState.getSectionState("currentSection");
 
@@ -47,22 +55,22 @@ function DocumentTypesCreateController($scope, $location, navigationService, con
                     }
                 }
             });
-        };
-    }
+        }
+    };
 
     $scope.createDocType = function() {
         $location.search('create', null);
         $location.search('notemplate', null);
         $location.path("/settings/documenttypes/edit/" + node.id).search("create", "true");
         navigationService.hideMenu();
-    }
+    };
 
     $scope.createComponent = function() {
-      $location.search('create', null);
-      $location.search('notemplate', null);
-      $location.path("/settings/documenttypes/edit/" + node.id).search("create", "true").search("notemplate", "true");
-      navigationService.hideMenu();
-    }
+        $location.search('create', null);
+        $location.search('notemplate', null);
+        $location.path("/settings/documenttypes/edit/" + node.id).search("create", "true").search("notemplate", "true");
+        navigationService.hideMenu();
+    };
 }
 
 angular.module('umbraco').controller("Umbraco.Editors.DocumentTypes.CreateController", DocumentTypesCreateController);
diff --git a/src/Umbraco.Web.UI.Client/src/views/documenttypes/create.html b/src/Umbraco.Web.UI.Client/src/views/documenttypes/create.html
index 35b718f7a4..f837e7292b 100644
--- a/src/Umbraco.Web.UI.Client/src/views/documenttypes/create.html
+++ b/src/Umbraco.Web.UI.Client/src/views/documenttypes/create.html
@@ -20,7 +20,7 @@
                 <span class="menu-label"><localize key="create_documentTypeWithoutTemplate"></localize></span>
               </a>
             </li>
-            <li>
+            <li ng-if="model.allowCreateFolder">
                 <a href="" ng-click="showCreateFolder()">
                     <i class="large icon-folder"></i>
                     <span class="menu-label"><localize key="general_folder"></localize></span>