diff --git a/src/Microsoft.SqlTools.ServiceLayer/QueryExecution/QueryExecutionService.cs b/src/Microsoft.SqlTools.ServiceLayer/QueryExecution/QueryExecutionService.cs
index da9816d8..46bbc286 100644
--- a/src/Microsoft.SqlTools.ServiceLayer/QueryExecution/QueryExecutionService.cs
+++ b/src/Microsoft.SqlTools.ServiceLayer/QueryExecution/QueryExecutionService.cs
@@ -37,12 +37,14 @@ namespace Microsoft.SqlTools.ServiceLayer.QueryExecution
         {
             ConnectionService = ConnectionService.Instance;
             WorkspaceService = WorkspaceService<SqlToolsSettings>.Instance;
+            Settings = new SqlToolsSettings();
         }
 
         internal QueryExecutionService(ConnectionService connService, WorkspaceService<SqlToolsSettings> workspaceService)
         {
             ConnectionService = connService;
             WorkspaceService = workspaceService;
+            Settings = new SqlToolsSettings();
         }
 
         #endregion
@@ -105,7 +107,10 @@ namespace Microsoft.SqlTools.ServiceLayer.QueryExecution
         private readonly Lazy<ConcurrentDictionary<string, Query>> queries =
             new Lazy<ConcurrentDictionary<string, Query>>(() => new ConcurrentDictionary<string, Query>());
 
-        private SqlToolsSettings Settings => WorkspaceService<SqlToolsSettings>.Instance.CurrentSettings;
+        /// <summary>
+        /// Settings that will be used to execute queries. Internal for unit testing
+        /// </summary>
+        internal SqlToolsSettings Settings { get; set; }
 
         #endregion
 
@@ -134,11 +139,7 @@ namespace Microsoft.SqlTools.ServiceLayer.QueryExecution
             });
 
             // Register a handler for when the configuration changes
-            WorkspaceService.RegisterConfigChangeCallback((oldSettings, newSettings, eventContext) =>
-            {
-                Settings.QueryExecutionSettings.Update(newSettings.QueryExecutionSettings);
-                return Task.FromResult(0);
-            });
+            WorkspaceService.RegisterConfigChangeCallback(UpdateSettings);
         }
 
         #region Request Handlers
@@ -410,13 +411,13 @@ namespace Microsoft.SqlTools.ServiceLayer.QueryExecution
                 }
 
                 // Retrieve the current settings for executing the query with
-                QueryExecutionSettings settings = WorkspaceService.CurrentSettings.QueryExecutionSettings;
+                QueryExecutionSettings querySettings = Settings.QueryExecutionSettings;
 
                 // Apply execution parameter settings 
-                settings.ExecutionPlanOptions = executeParams.ExecutionPlanOptions;
+                querySettings.ExecutionPlanOptions = executeParams.ExecutionPlanOptions;
 
                 // If we can't add the query now, it's assumed the query is in progress
-                Query newQuery = new Query(GetSqlText(executeParams), connectionInfo, settings, BufferFileFactory);
+                Query newQuery = new Query(GetSqlText(executeParams), connectionInfo, querySettings, BufferFileFactory);
                 if (!ActiveQueries.TryAdd(executeParams.OwnerUri, newQuery))
                 {
                     await failureAction(SR.QueryServiceQueryInProgress);
@@ -591,6 +592,13 @@ namespace Microsoft.SqlTools.ServiceLayer.QueryExecution
             throw new InvalidCastException("Invalid request type");
         }
 
+        /// Internal for testing purposes
+        internal Task UpdateSettings(SqlToolsSettings newSettings, SqlToolsSettings oldSettings, EventContext eventContext)
+        {
+            Settings.QueryExecutionSettings.Update(newSettings.QueryExecutionSettings);
+            return Task.FromResult(0);
+        }
+
         #endregion
 
         #region IDisposable Implementation
diff --git a/src/Microsoft.SqlTools.ServiceLayer/SqlContext/SqlToolsSettings.cs b/src/Microsoft.SqlTools.ServiceLayer/SqlContext/SqlToolsSettings.cs
index 93f677ed..539c6f83 100644
--- a/src/Microsoft.SqlTools.ServiceLayer/SqlContext/SqlToolsSettings.cs
+++ b/src/Microsoft.SqlTools.ServiceLayer/SqlContext/SqlToolsSettings.cs
@@ -126,6 +126,7 @@ namespace Microsoft.SqlTools.ServiceLayer.SqlContext
         /// <summary>
         /// Gets or sets the query execution settings
         /// </summary>
+        [JsonProperty("query")]
         public QueryExecutionSettings QueryExecutionSettings { get; set; }
 
         /// <summary>
diff --git a/test/Microsoft.SqlTools.ServiceLayer.Test/QueryExecution/SettingsTests.cs b/test/Microsoft.SqlTools.ServiceLayer.Test/QueryExecution/SettingsTests.cs
new file mode 100644
index 00000000..ecdac161
--- /dev/null
+++ b/test/Microsoft.SqlTools.ServiceLayer.Test/QueryExecution/SettingsTests.cs
@@ -0,0 +1,92 @@
+//
+// 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.ServiceLayer.Hosting.Protocol;
+using Microsoft.SqlTools.ServiceLayer.QueryExecution;
+using Microsoft.SqlTools.ServiceLayer.QueryExecution.Contracts;
+using Microsoft.SqlTools.ServiceLayer.SqlContext;
+using Newtonsoft.Json.Linq;
+using Xunit;
+
+namespace Microsoft.SqlTools.ServiceLayer.Test.QueryExecution
+{
+    public class SettingsTests
+    {
+        [Fact]
+        public void ValidateQueryExecuteDefaults()
+        {
+            // If: I create a new settings object
+            var sqlToolsSettings = new SqlToolsSettings();
+
+            // Then: The default values should be as expected
+            Assert.Equal("GO", sqlToolsSettings.QueryExecutionSettings.BatchSeparator);
+            Assert.Equal(ushort.MaxValue, sqlToolsSettings.QueryExecutionSettings.MaxCharsToStore);
+            Assert.Equal(2*1024*1024, sqlToolsSettings.QueryExecutionSettings.MaxXmlCharsToStore);
+            Assert.False(sqlToolsSettings.QueryExecutionSettings.ExecutionPlanOptions.IncludeActualExecutionPlanXml);
+            Assert.False(sqlToolsSettings.QueryExecutionSettings.ExecutionPlanOptions.IncludeEstimatedExecutionPlanXml);
+            Assert.True(sqlToolsSettings.QueryExecutionSettings.DisplayBitAsNumber);
+        }
+
+        [Fact]
+        public void ValidateSettingsParsedFromJson()
+        {
+            // NOTE: Only testing displayBitAsNumber for now because it is the only one piped through
+            const string settingsJson = @"{"
+                                        + @"""params"": {"
+                                        + @"""mssql"": {"
+                                        + @"""query"": {"
+                                        + @"displayBitAsNumber: false"
+                                        + @"}"
+                                        + @"}"
+                                        + @"}"
+                                        + @"}";
+
+            // If: I parse the settings JSON object
+            JObject message = JObject.Parse(settingsJson);
+            JToken messageParams;
+            Assert.True(message.TryGetValue("params", out messageParams));
+            SqlToolsSettings sqlToolsSettings = messageParams.ToObject<SqlToolsSettings>();
+
+            // Then: The values defined in the JSON should propagate to the setting object
+            Assert.False(sqlToolsSettings.QueryExecutionSettings.DisplayBitAsNumber);
+        }
+
+        [Fact]
+        public void ValidateSettingsObjectUpdates()
+        {
+            // If: I update a settings object with a new settings object
+            var qes = new QueryExecutionService(null, null);
+            SqlToolsSettings settings = new SqlToolsSettings()
+            {
+                SqlTools = new SqlToolsSettingsValues
+                {
+                    QueryExecutionSettings = new QueryExecutionSettings
+                    {
+                        DisplayBitAsNumber = false,
+                        MaxXmlCharsToStore = 1,
+                        MaxCharsToStore = 1,
+                        ExecutionPlanOptions = new ExecutionPlanOptions
+                        {
+                            IncludeActualExecutionPlanXml = true,
+                            IncludeEstimatedExecutionPlanXml = true
+                        },
+                        BatchSeparator = "YO"
+                    }
+                }
+                    
+            };
+            qes.UpdateSettings(settings, null, new EventContext());
+
+            // Then: The settings object should match what it was updated to
+            Assert.False(qes.Settings.QueryExecutionSettings.DisplayBitAsNumber);
+            Assert.True(qes.Settings.QueryExecutionSettings.ExecutionPlanOptions.IncludeActualExecutionPlanXml);
+            Assert.True(qes.Settings.QueryExecutionSettings.ExecutionPlanOptions.IncludeEstimatedExecutionPlanXml);
+            Assert.Equal(1, qes.Settings.QueryExecutionSettings.MaxCharsToStore);
+            Assert.Equal(1, qes.Settings.QueryExecutionSettings.MaxXmlCharsToStore);
+            Assert.Equal("YO", qes.Settings.QueryExecutionSettings.BatchSeparator);
+        }
+
+    }
+}