diff --git a/extensions/sql-database-projects/package.json b/extensions/sql-database-projects/package.json
index 7031fc5943..198bf34f36 100644
--- a/extensions/sql-database-projects/package.json
+++ b/extensions/sql-database-projects/package.json
@@ -59,6 +59,10 @@
           "sqlDatabaseProjects.autorestSqlVersion": {
             "type": "string",
             "description": "%sqlDatabaseProjects.autorestSqlVersion%"
+          },
+          "sqlDatabaseProjects.collapseProjectNodes": {
+            "type": "boolean",
+            "description": "%sqlDatabaseProjects.collapseProjectNodes%"
           }
         }
       }
diff --git a/extensions/sql-database-projects/package.nls.json b/extensions/sql-database-projects/package.nls.json
index 262a62f3a3..51dbbbe405 100644
--- a/extensions/sql-database-projects/package.nls.json
+++ b/extensions/sql-database-projects/package.nls.json
@@ -40,5 +40,6 @@
 	"sqlDatabaseProjects.netCoreDoNotAsk": "Whether to prompt the user to install .NET Core when not detected.",
 	"sqlDatabaseProjects.nodejsDoNotAsk": "Whether to prompt the user to install Node.js when not detected.",
 	"sqlDatabaseProjects.autorestSqlVersion": "Which version of Autorest.Sql to use from NPM.  Latest will be used if not set.",
+	"sqlDatabaseProjects.collapseProjectNodes": "Whether project nodes start collapsed",
 	"sqlDatabaseProjects.welcome": "No database projects currently open.\n[New Project](command:sqlDatabaseProjects.new)\n[Open Project](command:sqlDatabaseProjects.open)\n[Create Project From Database](command:sqlDatabaseProjects.importDatabase)"
 }
diff --git a/extensions/sql-database-projects/src/common/constants.ts b/extensions/sql-database-projects/src/common/constants.ts
index 501ad8e649..e97e82ed5e 100644
--- a/extensions/sql-database-projects/src/common/constants.ts
+++ b/extensions/sql-database-projects/src/common/constants.ts
@@ -605,3 +605,5 @@ export enum PublishTargetType {
 	docker = 'docker',
 	newAzureServer = 'newAzureServer'
 }
+
+export const CollapseProjectNodesKey = 'collapseProjectNodes';
diff --git a/extensions/sql-database-projects/src/models/tree/projectTreeItem.ts b/extensions/sql-database-projects/src/models/tree/projectTreeItem.ts
index 4e2c9f6e2c..f6d9965609 100644
--- a/extensions/sql-database-projects/src/models/tree/projectTreeItem.ts
+++ b/extensions/sql-database-projects/src/models/tree/projectTreeItem.ts
@@ -11,10 +11,11 @@ import * as fileTree from './fileFolderTreeItem';
 import { Project } from '../project';
 import * as utils from '../../common/utils';
 import { DatabaseReferencesTreeItem } from './databaseReferencesTreeItem';
-import { DatabaseProjectItemType, RelativeOuterPath, ExternalStreamingJob, sqlprojExtension } from '../../common/constants';
+import { DatabaseProjectItemType, RelativeOuterPath, ExternalStreamingJob, sqlprojExtension, CollapseProjectNodesKey } from '../../common/constants';
 import { IconPathHelper } from '../../common/iconHelper';
 import { FileProjectEntry } from '../projectEntry';
 import { EntryType } from 'sqldbproj';
+import { DBProjectConfigurationKey } from '../../tools/netcoreTool';
 
 /**
  * TreeNode root that represents an entire project
@@ -47,7 +48,8 @@ export class ProjectRootTreeItem extends BaseProjectTreeItem {
 	}
 
 	public get treeItem(): vscode.TreeItem {
-		const projectItem = new vscode.TreeItem(this.fileSystemUri, vscode.TreeItemCollapsibleState.Expanded);
+		const collapsibleState = vscode.workspace.getConfiguration(DBProjectConfigurationKey)[CollapseProjectNodesKey] ? vscode.TreeItemCollapsibleState.Collapsed : vscode.TreeItemCollapsibleState.Expanded;
+		const projectItem = new vscode.TreeItem(this.fileSystemUri, collapsibleState);
 		projectItem.contextValue = this.project.isSdkStyleProject ? DatabaseProjectItemType.project : DatabaseProjectItemType.legacyProject;
 		projectItem.iconPath = IconPathHelper.databaseProject;
 		projectItem.label = path.basename(this.projectUri.fsPath, sqlprojExtension);