diff --git a/crates/ruff_server/src/server.rs b/crates/ruff_server/src/server.rs
index aed36c7e01177..affeeb67f0f1d 100644
--- a/crates/ruff_server/src/server.rs
+++ b/crates/ruff_server/src/server.rs
@@ -173,10 +173,14 @@ impl Server {
                             watchers: vec![
                                 FileSystemWatcher {
                                     glob_pattern: types::GlobPattern::String(
-                                        "**/.?ruff.toml".into(),
+                                        "**/.ruff.toml".into(),
                                     ),
                                     kind: None,
                                 },
+                                FileSystemWatcher {
+                                    glob_pattern: types::GlobPattern::String("**/ruff.toml".into()),
+                                    kind: None,
+                                },
                                 FileSystemWatcher {
                                     glob_pattern: types::GlobPattern::String(
                                         "**/pyproject.toml".into(),
diff --git a/crates/ruff_server/src/server/api/notifications/did_change_watched_files.rs b/crates/ruff_server/src/server/api/notifications/did_change_watched_files.rs
index 5f8e79b637bd0..15e6b60f897db 100644
--- a/crates/ruff_server/src/server/api/notifications/did_change_watched_files.rs
+++ b/crates/ruff_server/src/server/api/notifications/did_change_watched_files.rs
@@ -1,3 +1,4 @@
+use crate::server::api::diagnostics::publish_diagnostics_for_document;
 use crate::server::api::LSPResult;
 use crate::server::client::{Notifier, Requester};
 use crate::server::schedule::Task;
@@ -15,7 +16,7 @@ impl super::NotificationHandler for DidChangeWatchedFiles {
 impl super::SyncNotificationHandler for DidChangeWatchedFiles {
     fn run(
         session: &mut Session,
-        _notifier: Notifier,
+        notifier: Notifier,
         requester: &mut Requester,
         params: types::DidChangeWatchedFilesParams,
     ) -> Result<()> {
@@ -23,10 +24,28 @@ impl super::SyncNotificationHandler for DidChangeWatchedFiles {
             session.reload_settings(&change.uri.to_file_path().unwrap());
         }
 
-        if session.resolved_client_capabilities().workspace_refresh && !params.changes.is_empty() {
-            requester
-                .request::<types::request::WorkspaceDiagnosticRefresh>((), |()| Task::nothing())
-                .with_failure_code(lsp_server::ErrorCode::InternalError)?;
+        if !params.changes.is_empty() {
+            if session.resolved_client_capabilities().workspace_refresh {
+                requester
+                    .request::<types::request::WorkspaceDiagnosticRefresh>((), |()| Task::nothing())
+                    .with_failure_code(lsp_server::ErrorCode::InternalError)?;
+            } else {
+                // publish diagnostics for text documents
+                for url in session.text_document_urls() {
+                    let snapshot = session
+                        .take_snapshot(&url)
+                        .expect("snapshot should be available");
+                    publish_diagnostics_for_document(&snapshot, &notifier)?;
+                }
+            }
+
+            // always publish diagnostics for notebook files (since they don't use pull diagnostics)
+            for url in session.notebook_document_urls() {
+                let snapshot = session
+                    .take_snapshot(&url)
+                    .expect("snapshot should be available");
+                publish_diagnostics_for_document(&snapshot, &notifier)?;
+            }
         }
 
         Ok(())
diff --git a/crates/ruff_server/src/session.rs b/crates/ruff_server/src/session.rs
index 3c271bb6fda9b..9058eed1fb73e 100644
--- a/crates/ruff_server/src/session.rs
+++ b/crates/ruff_server/src/session.rs
@@ -72,6 +72,16 @@ impl Session {
         })
     }
 
+    /// Iterates over the LSP URLs for all open text documents. These URLs are valid file paths.
+    pub(super) fn text_document_urls(&self) -> impl Iterator<Item = lsp_types::Url> + '_ {
+        self.index.text_document_urls()
+    }
+
+    /// Iterates over the LSP URLs for all open notebook documents. These URLs are valid file paths.
+    pub(super) fn notebook_document_urls(&self) -> impl Iterator<Item = lsp_types::Url> + '_ {
+        self.index.notebook_document_urls()
+    }
+
     /// Updates a text document at the associated `key`.
     ///
     /// The document key must point to a text document, or this will throw an error.
diff --git a/crates/ruff_server/src/session/index.rs b/crates/ruff_server/src/session/index.rs
index 9304cba1fccdc..453e8eb8f2e2a 100644
--- a/crates/ruff_server/src/session/index.rs
+++ b/crates/ruff_server/src/session/index.rs
@@ -88,6 +88,24 @@ impl Index {
         }
     }
 
+    pub(super) fn text_document_urls(&self) -> impl Iterator<Item = lsp_types::Url> + '_ {
+        self.documents
+            .iter()
+            .filter(|(_, doc)| doc.as_text().is_some())
+            .map(|(path, _)| {
+                lsp_types::Url::from_file_path(path).expect("valid file path should convert to URL")
+            })
+    }
+
+    pub(super) fn notebook_document_urls(&self) -> impl Iterator<Item = lsp_types::Url> + '_ {
+        self.documents
+            .iter()
+            .filter(|(_, doc)| doc.as_notebook().is_some())
+            .map(|(path, _)| {
+                lsp_types::Url::from_file_path(path).expect("valid file path should convert to URL")
+            })
+    }
+
     pub(super) fn update_text_document(
         &mut self,
         key: &DocumentKey,
@@ -234,11 +252,14 @@ impl Index {
         Some(controller.make_ref(cell_uri, path, document_settings))
     }
 
+    /// Reloads relevant existing settings files based on a changed settings file path.
+    /// This does not currently register new settings files.
     pub(super) fn reload_settings(&mut self, changed_path: &PathBuf) {
+        let search_path = changed_path.parent().unwrap_or(changed_path);
         for (root, settings) in self
             .settings
             .iter_mut()
-            .filter(|(path, _)| path.starts_with(changed_path))
+            .filter(|(path, _)| path.starts_with(search_path))
         {
             settings.workspace_settings_index = ruff_settings::RuffSettingsIndex::new(
                 root,