diff --git a/src/Microsoft.SqlTools.Hosting/Hosting/Contracts/CapabilitiesRequest.cs b/src/Microsoft.SqlTools.Hosting/Hosting/Contracts/CapabilitiesRequest.cs
new file mode 100644
index 00000000..20cd0789
--- /dev/null
+++ b/src/Microsoft.SqlTools.Hosting/Hosting/Contracts/CapabilitiesRequest.cs
@@ -0,0 +1,29 @@
+//
+// Copyright (c) Microsoft. All rights reserved.
+// Licensed under the MIT license. See LICENSE file in the project root for full license information.
+//
+
+using Microsoft.SqlTools.Hosting.Protocol.Contracts;
+
+namespace Microsoft.SqlTools.Hosting.Contracts
+{
+    /// <summary>
+    /// Defines a message that is sent from the client to request
+    /// the version of the server.
+    /// </summary>
+    public class CapabilitiesRequest
+    {
+        public static readonly
+           RequestType<CapabilitiesRequest, CapabilitiesResult> Type =
+            RequestType<CapabilitiesRequest, CapabilitiesResult>.Create("capabilities/list");
+
+        public string HostName { get; set; }
+
+        public string HostVersion { get; set; }
+    }
+
+    public class CapabilitiesResult
+    {
+        public DmpServerCapabilities Capabilities { get; set; }
+    }    
+}
diff --git a/src/Microsoft.SqlTools.Hosting/Hosting/Contracts/ConnectionProviderOptions.cs b/src/Microsoft.SqlTools.Hosting/Hosting/Contracts/ConnectionProviderOptions.cs
new file mode 100644
index 00000000..066f0827
--- /dev/null
+++ b/src/Microsoft.SqlTools.Hosting/Hosting/Contracts/ConnectionProviderOptions.cs
@@ -0,0 +1,67 @@
+//
+// Copyright (c) Microsoft. All rights reserved.
+// Licensed under the MIT license. See LICENSE file in the project root for full license information.
+//
+
+namespace Microsoft.SqlTools.Hosting.Contracts
+{
+    /// <summary>
+    /// Defines the connection provider options that the DMP server
+    /// implements.  This includes metadata regarding supported connection
+    /// properties.
+    /// </summary>
+    public class ConnectionProviderOptions
+    {
+        public ConnectionOption[] Options { get; set; }
+    }
+
+    public class ConnectionOption
+    {
+        public static readonly string ValueTypeString = "string";
+        public static readonly string ValueTypeMultiString = "multistring";
+        public static readonly string ValueTypePassword = "password";
+        public static readonly string ValueTypeNumber = "number";
+        public static readonly string ValueTypeCategory = "category";
+        public static readonly string ValueTypeBoolean = "boolean";
+
+        public static readonly string SpecialValueServerName = "serverName";
+        public static readonly string SpecialValueDatabaseName = "databaseName";
+        public static readonly string SpecialValueAuthType = "authType";
+        public static readonly string SpecialValueUserName = "userName";
+        public static readonly string SpecialValuePasswordName = "password";
+
+        public string Name { get; set; }
+
+        public string DisplayName { get; set; }
+
+        /// <summary>
+        /// Type of the parameter.  Can be either string, number, or category.
+        /// </summary>
+        public string ValueType { get; set; }
+
+        public string DefaultValue { get; set; }
+
+        /// <summary>
+        /// Set of permitted values if ValueType is category.
+        /// </summary>
+        public string[] CategoryValues { get; set; }
+
+        /// <summary>
+        /// Determines if the parameter is one of the 'specical' known values.
+        /// Can be either Server Name, Database Name, Authentication Type,
+        /// User Name, or Password
+        /// </summary>
+        public string SpecialValueType { get; set; }
+
+        /// <summary>
+        /// Flag to indicate that this option is part of the connection identity
+        /// </summary>
+        public bool IsIdentity { get; set; }
+
+        /// <summary>
+        /// Flag to indicate that this option is required
+        /// </summary>
+        public bool IsRequired { get; set; }   
+    }
+}
+
diff --git a/src/Microsoft.SqlTools.Hosting/Hosting/Contracts/DmpServerCapabilities.cs b/src/Microsoft.SqlTools.Hosting/Hosting/Contracts/DmpServerCapabilities.cs
index d38efe0f..9b204021 100644
--- a/src/Microsoft.SqlTools.Hosting/Hosting/Contracts/DmpServerCapabilities.cs
+++ b/src/Microsoft.SqlTools.Hosting/Hosting/Contracts/DmpServerCapabilities.cs
@@ -5,11 +5,17 @@
 
 namespace Microsoft.SqlTools.Hosting.Contracts
 {
+    /// <summary>
+    /// Defines the DMP server capabilities
+    /// </summary>
     public class DmpServerCapabilities
     {
-        public string ProviderName { get; set; 
-        }
-        public bool? HoverProvider { get; set; }
+        public string ProtocolVersion { get; set; }
+
+        public string ProviderName { get; set; }
+
+        public string ProviderDisplayName { get; set; }
+
+        public ConnectionProviderOptions ConnectionProvider { get; set; }
     }
 }
-
diff --git a/src/Microsoft.SqlTools.ServiceLayer/ServiceHost.cs b/src/Microsoft.SqlTools.ServiceLayer/ServiceHost.cs
index 1bddc4cb..615f648f 100644
--- a/src/Microsoft.SqlTools.ServiceLayer/ServiceHost.cs
+++ b/src/Microsoft.SqlTools.ServiceLayer/ServiceHost.cs
@@ -62,8 +62,9 @@ namespace Microsoft.SqlTools.ServiceLayer.Hosting
         public void InitializeRequestHandlers()
         {
             // Register the requests that this service host will handle
-            this.SetRequestHandler(InitializeRequest.Type, this.HandleInitializeRequest);
-            this.SetRequestHandler(ShutdownRequest.Type, this.HandleShutdownRequest);
+            this.SetRequestHandler(InitializeRequest.Type, HandleInitializeRequest);
+            this.SetRequestHandler(CapabilitiesRequest.Type, HandleCapabilitiesRequest);
+            this.SetRequestHandler(ShutdownRequest.Type, HandleShutdownRequest);
             this.SetRequestHandler(VersionRequest.Type, HandleVersionRequest);
         }
 
@@ -171,6 +172,140 @@ namespace Microsoft.SqlTools.ServiceLayer.Hosting
                 });
         }
 
+        internal async Task HandleCapabilitiesRequest(
+            CapabilitiesRequest initializeParams, 
+            RequestContext<CapabilitiesResult> requestContext)            
+        {
+            await requestContext.SendResult(
+                new CapabilitiesResult
+                {
+                    Capabilities = new DmpServerCapabilities
+                    {
+                        ProtocolVersion = "1.0",
+                        ProviderName = "MSSQL",
+                        ProviderDisplayName = "Microsoft SQL Server",
+                        ConnectionProvider = ServiceHost.BuildConnectionProviderOptions()                      
+                    }
+                }
+            );            
+        }
+
+        private static ConnectionProviderOptions BuildConnectionProviderOptions()
+        {
+            return new ConnectionProviderOptions
+            {
+                Options = new ConnectionOption[]
+                {
+                    new ConnectionOption
+                    {
+                        Name = "Server Name",
+                        ValueType = ConnectionOption.ValueTypeString,
+                        SpecialValueType = ConnectionOption.SpecialValueServerName,
+                        IsIdentity = true,
+                        IsRequired = true
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Initial Catalog",
+                        DisplayName = "Database Name",
+                        ValueType = ConnectionOption.ValueTypeString,
+                        SpecialValueType = ConnectionOption.SpecialValueDatabaseName,
+                        IsIdentity = true,
+                        IsRequired = true
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Auth Type",
+                        ValueType = ConnectionOption.ValueTypeCategory,
+                        SpecialValueType = ConnectionOption.SpecialValueAuthType,
+                        CategoryValues = new string[] { "SQL Login", "Integrated Auth" },
+                        IsIdentity = true,
+                        IsRequired = true
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Username",
+                        ValueType = ConnectionOption.ValueTypeString,
+                        SpecialValueType = ConnectionOption.SpecialValueUserName,
+                        IsIdentity = true,
+                        IsRequired = true
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Password",
+                        DisplayName = "Database Name",
+                        ValueType = ConnectionOption.ValueTypePassword,
+                        SpecialValueType = ConnectionOption.SpecialValuePasswordName,
+                        IsIdentity = true,
+                        IsRequired = true
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Application Intent",
+                        ValueType = ConnectionOption.ValueTypeCategory,
+                        CategoryValues = new string[] { "ReadWrite", "ReadOnly" }
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Asynchronous Processing",
+                        ValueType = ConnectionOption.ValueTypeBoolean
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Connect Timeout",
+                        ValueType = ConnectionOption.ValueTypeNumber,
+                        DefaultValue = "15"
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Current Language",
+                        ValueType = ConnectionOption.ValueTypeString
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Column Encrytion Setting",
+                        ValueType = ConnectionOption.ValueTypeCategory,
+                        CategoryValues = new string[] { "Disabled", "Enabled" }
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Encrypt",
+                        ValueType = ConnectionOption.ValueTypeBoolean
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Persist Security Info",
+                        ValueType = ConnectionOption.ValueTypeBoolean
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Trust Server Certificate",
+                        ValueType = ConnectionOption.ValueTypeBoolean
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Persist Security Info",
+                        ValueType = ConnectionOption.ValueTypeBoolean
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Trust Server Certificate",
+                        ValueType = ConnectionOption.ValueTypeBoolean
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Attached DB File Name",
+                        ValueType = ConnectionOption.ValueTypeString
+                    },
+                    new ConnectionOption
+                    {
+                        Name = "Context Connection",
+                        ValueType = ConnectionOption.ValueTypeString
+                    }
+                }
+            };
+        }
+
         /// <summary>
         /// Handles the version request. Sends back the server version as result.
         /// </summary>
diff --git a/test/Microsoft.SqlTools.ServiceLayer.UnitTests/ServiceHost/CapabilitiesTests.cs b/test/Microsoft.SqlTools.ServiceLayer.UnitTests/ServiceHost/CapabilitiesTests.cs
new file mode 100644
index 00000000..04cfb80a
--- /dev/null
+++ b/test/Microsoft.SqlTools.ServiceLayer.UnitTests/ServiceHost/CapabilitiesTests.cs
@@ -0,0 +1,35 @@
+//
+// Copyright (c) Microsoft. All rights reserved.
+// Licensed under the MIT license. See LICENSE file in the project root for full license information.
+//
+
+using System.Threading.Tasks;
+using Microsoft.SqlTools.Hosting.Contracts;
+using Microsoft.SqlTools.Hosting.Protocol;
+using Moq;
+using Xunit;
+
+namespace Microsoft.SqlTools.ServiceLayer.UnitTests.Capabilities
+{
+    /// <summary>
+    /// Test cases for the capabilities discovery messages
+    /// </summary>
+    public class Capabilities
+    {
+        [Fact]
+        public async Task TestCapabilities()
+        {
+            Hosting.ServiceHost host = Hosting.ServiceHost.Instance;
+            var requestContext = new Mock<RequestContext<CapabilitiesResult>>();
+            requestContext.Setup(x => x.SendResult(It.IsAny<CapabilitiesResult>())).Returns(Task.FromResult(new object()));
+            
+            await host.HandleCapabilitiesRequest(new CapabilitiesRequest
+            {
+                HostName = "Test Host", HostVersion = "1.0"
+            }, requestContext.Object);
+
+            requestContext.Verify(x => x.SendResult(It.Is<CapabilitiesResult>(
+                 i => i.Capabilities.ConnectionProvider.Options != null)));         
+        }
+    }
+}