diff --git a/pkg/agent/tunnelserver/tunnelserver.go b/pkg/agent/tunnelserver/tunnelserver.go
index b4dafd9ee..be6f69b0f 100644
--- a/pkg/agent/tunnelserver/tunnelserver.go
+++ b/pkg/agent/tunnelserver/tunnelserver.go
@@ -8,6 +8,7 @@ import (
 	"fmt"
 	"io"
 	"os"
+	"path/filepath"
 	"strings"
 
 	"github.com/loft-sh/devpod/pkg/agent/tunnel"
@@ -23,6 +24,7 @@ import (
 	provider2 "github.com/loft-sh/devpod/pkg/provider"
 	"github.com/loft-sh/devpod/pkg/stdio"
 	"github.com/loft-sh/log"
+	"github.com/moby/buildkit/frontend/dockerfile/dockerignore"
 	perrors "github.com/pkg/errors"
 	"google.golang.org/grpc"
 	"google.golang.org/grpc/reflection"
@@ -383,8 +385,18 @@ func (t *tunnelServer) StreamWorkspace(message *tunnel.Empty, stream tunnel.Tunn
 		return fmt.Errorf("workspace is nil")
 	}
 
+	// Get .devpodignore files to exclude
+	excludes := []string{}
+	f, err := os.Open(filepath.Join(t.workspace.Source.LocalFolder, ".devpodignore"))
+	if err == nil {
+		excludes, err = dockerignore.ReadAll(f)
+		if err != nil {
+			t.log.Warnf("Error reading .devpodignore file: %v", err)
+		}
+	}
+
 	buf := bufio.NewWriterSize(NewStreamWriter(stream, t.log), 10*1024)
-	err := extract.WriteTar(buf, t.workspace.Source.LocalFolder, false)
+	err = extract.WriteTarExclude(buf, t.workspace.Source.LocalFolder, false, excludes)
 	if err != nil {
 		return err
 	}
@@ -405,8 +417,18 @@ func (t *tunnelServer) StreamMount(message *tunnel.StreamMountRequest, stream tu
 		return fmt.Errorf("mount %s is not allowed to download", message.Mount)
 	}
 
+	// Get .devpodignore files to exclude
+	excludes := []string{}
+	f, err := os.Open(filepath.Join(t.workspace.Source.LocalFolder, ".devpodignore"))
+	if err == nil {
+		excludes, err = dockerignore.ReadAll(f)
+		if err != nil {
+			t.log.Warnf("Error reading .devpodignore file: %v", err)
+		}
+	}
+
 	buf := bufio.NewWriterSize(NewStreamWriter(stream, t.log), 10*1024)
-	err := extract.WriteTar(buf, mount.Source, false)
+	err = extract.WriteTarExclude(buf, mount.Source, false, excludes)
 	if err != nil {
 		return err
 	}
diff --git a/pkg/agent/workspace.go b/pkg/agent/workspace.go
index 2f388bceb..95fffa75d 100644
--- a/pkg/agent/workspace.go
+++ b/pkg/agent/workspace.go
@@ -17,6 +17,7 @@ import (
 	provider2 "github.com/loft-sh/devpod/pkg/provider"
 	"github.com/loft-sh/log"
 	"github.com/mitchellh/go-homedir"
+	"github.com/moby/buildkit/frontend/dockerfile/dockerignore"
 )
 
 var extraSearchLocations = []string{"/home/devpod/.devpod/agent", "/opt/devpod/agent", "/var/lib/devpod/agent", "/var/devpod/agent"}
@@ -303,6 +304,22 @@ func CloneRepositoryForWorkspace(
 
 	log.Done("Successfully cloned repository")
 
+	// Get .devpodignore files to exclude
+	f, err := os.Open(filepath.Join(workspaceDir, ".devpodignore"))
+	if err != nil {
+		return nil
+	}
+	excludes, err := dockerignore.ReadAll(f)
+	if err != nil {
+		log.Warn(".devpodignore file is invalid : ", err)
+		return nil
+	}
+	// Remove files from workspace content folder
+	for _, exclude := range excludes {
+		os.RemoveAll(filepath.Join(workspaceDir, exclude))
+	}
+	log.Debug("Ignore files from .devpodignore ", excludes)
+
 	return nil
 }