diff --git a/demo-shell-ng2/app/components/files/files.component.html b/demo-shell-ng2/app/components/files/files.component.html
index 7d8ac80977..bf828122ff 100644
--- a/demo-shell-ng2/app/components/files/files.component.html
+++ b/demo-shell-ng2/app/components/files/files.component.html
@@ -20,7 +20,8 @@
                 [allowDropFiles]="true"
                 (error)="onNavigationError($event)"
                 (success)="resetError()"
-                (preview)="showFile($event)">
+                (preview)="showFile($event)"
+                (permissionError)="onPermissionsFailed($event)">
             <data-columns>
                 <data-column key="$thumbnail" type="image" [sortable]="false"></data-column>
                 <data-column
diff --git a/demo-shell-ng2/app/components/setting/setting.component.html b/demo-shell-ng2/app/components/setting/setting.component.html
index 3e65b97283..7c1a19d69c 100644
--- a/demo-shell-ng2/app/components/setting/setting.component.html
+++ b/demo-shell-ng2/app/components/setting/setting.component.html
@@ -27,7 +27,7 @@
                 </div>
                 <nav class="mdl-navigation">
                     <i class="icon material-icons icon-margin">link</i>
-                    <div class="mdl-textfield mdl-js-textfield adf-setting-input-paddingg">
+                    <div class="mdl-textfield mdl-js-textfield adf-setting-input-padding">
                         <input class="mdl-textfield__input"
                                type="text"
                                (change)="onChangeBPMHost($event)"
diff --git a/ng2-components/ng2-alfresco-documentlist/README.md b/ng2-components/ng2-alfresco-documentlist/README.md
index cc51250194..a663399537 100644
--- a/ng2-components/ng2-alfresco-documentlist/README.md
+++ b/ng2-components/ng2-alfresco-documentlist/README.md
@@ -783,6 +783,7 @@ DocumentList emits the following events:
 | `nodeDblClick` | emitted when user double-clicks list node |
 | `folderChange` | emitted once current display folder has changed |
 | `preview` | emitted when user acts upon files with either single or double click (depends on `navigation-mode`), recommended for Viewer components integration  |
+| `permissionError` | emitted when user is attempting to create a folder via action menu but it doesn't have the permission to do it |
 
 ## Advanced usage and customization
 
diff --git a/ng2-components/ng2-alfresco-documentlist/src/components/document-list.component.html b/ng2-components/ng2-alfresco-documentlist/src/components/document-list.component.html
index c35d11fb4b..afc70dedb9 100644
--- a/ng2-components/ng2-alfresco-documentlist/src/components/document-list.component.html
+++ b/ng2-components/ng2-alfresco-documentlist/src/components/document-list.component.html
@@ -2,7 +2,8 @@
     *ngIf="creationMenuActions"
     [folderId]="currentFolderId"
     (success)="onActionMenuSuccess($event)"
-    (error)="onActionMenuError($event)">
+    (error)="onActionMenuError($event)"
+    (permissionErrorEvent)="onPermissionError($event)">
 </alfresco-document-menu-action>
 <alfresco-datatable
     [data]="data"
diff --git a/ng2-components/ng2-alfresco-documentlist/src/components/document-list.component.ts b/ng2-components/ng2-alfresco-documentlist/src/components/document-list.component.ts
index 59251f8b6b..95c4393b8d 100644
--- a/ng2-components/ng2-alfresco-documentlist/src/components/document-list.component.ts
+++ b/ng2-components/ng2-alfresco-documentlist/src/components/document-list.component.ts
@@ -22,7 +22,14 @@ import {
 import { Subject } from 'rxjs/Rx';
 import { MinimalNodeEntity, MinimalNodeEntryEntity, NodePaging, Pagination } from 'alfresco-js-api';
 import { AlfrescoTranslationService, DataColumnListComponent } from 'ng2-alfresco-core';
-import { DataRowEvent, DataTableComponent, ObjectDataColumn, DataCellEvent, DataRowActionEvent, DataColumn } from 'ng2-alfresco-datatable';
+import {
+    DataRowEvent,
+    DataTableComponent,
+    ObjectDataColumn,
+    DataCellEvent,
+    DataRowActionEvent,
+    DataColumn
+} from 'ng2-alfresco-datatable';
 import { DocumentListService } from './../services/document-list.service';
 import { ContentActionModel } from './../models/content-action.model';
 import { ShareDataTableAdapter, ShareDataRow, RowFilter, ImageResolver } from './../data/share-datatable-adapter';
@@ -132,6 +139,9 @@ export class DocumentListComponent implements OnInit, OnChanges, AfterContentIni
     @Output()
     error: EventEmitter<any> = new EventEmitter();
 
+    @Output()
+    permissionError: EventEmitter<any> = new EventEmitter();
+
     @ViewChild(DataTableComponent)
     dataTable: DataTableComponent;
 
@@ -328,11 +338,11 @@ export class DocumentListComponent implements OnInit, OnChanges, AfterContentIni
     // gets folder node and its content
     loadFolderByNodeId(nodeId: string) {
         this.documentListService.getFolderNode(nodeId).then(node => {
-                this.folderNode = node;
-                this.currentFolderId = node.id;
-                this.skipCount = 0;
-                this.loadFolderNodesByFolderNodeId(node.id, this.pageSize, this.skipCount).catch(err => this.error.emit(err));
-            })
+            this.folderNode = node;
+            this.currentFolderId = node.id;
+            this.skipCount = 0;
+            this.loadFolderNodesByFolderNodeId(node.id, this.pageSize, this.skipCount).catch(err => this.error.emit(err));
+        })
             .catch(err => this.error.emit(err));
     }
 
@@ -488,4 +498,8 @@ export class DocumentListComponent implements OnInit, OnChanges, AfterContentIni
         this.skipCount = event.skipCount;
         this.reload();
     }
+
+    onPermissionError(event) {
+        this.permissionError.emit(event);
+    }
 }
diff --git a/ng2-components/ng2-alfresco-documentlist/src/components/document-menu-action.component.html b/ng2-components/ng2-alfresco-documentlist/src/components/document-menu-action.component.html
index 20b70b13be..bb2e658852 100644
--- a/ng2-components/ng2-alfresco-documentlist/src/components/document-menu-action.component.html
+++ b/ng2-components/ng2-alfresco-documentlist/src/components/document-menu-action.component.html
@@ -1,5 +1,5 @@
 <div class="container">
-    <button md-button [mdMenuTriggerFor]="menu">
+    <button id="folder-create-button" md-button [mdMenuTriggerFor]="menu" [disabled]="isButtonDisabled()">
         <md-icon>add</md-icon>
         <span>{{ 'ALFRESCO_DOCUMENT_LIST.BUTTON.ACTION_CREATE' | translate }}</span>
     </button>
diff --git a/ng2-components/ng2-alfresco-documentlist/src/components/document-menu-action.component.spec.ts b/ng2-components/ng2-alfresco-documentlist/src/components/document-menu-action.component.spec.ts
index 7a3136784e..af4575649a 100644
--- a/ng2-components/ng2-alfresco-documentlist/src/components/document-menu-action.component.spec.ts
+++ b/ng2-components/ng2-alfresco-documentlist/src/components/document-menu-action.component.spec.ts
@@ -16,9 +16,11 @@
  */
 
 import { async, ComponentFixture, TestBed } from '@angular/core/testing';
+import { SimpleChange } from '@angular/core';
 import {
     AlfrescoAuthenticationService,
     AlfrescoSettingsService,
+    AlfrescoTranslationService,
     AlfrescoApiService,
     CoreModule,
     LogService
@@ -28,6 +30,56 @@ import { DocumentMenuActionComponent } from './document-menu-action.component';
 
 declare let jasmine: any;
 
+let exampleFolderWithCreate = {
+    'entry': {
+        'aspectNames': ['cm:auditable'],
+        'allowableOperations': ['create'],
+        'createdAt': '2017-04-03T11:34:35.708+0000',
+        'isFolder': true,
+        'isFile': false,
+        'createdByUser': { 'id': 'admin', 'displayName': 'Administrator' },
+        'modifiedAt': '2017-04-03T11:34:35.708+0000',
+        'modifiedByUser': { 'id': 'admin', 'displayName': 'Administrator' },
+        'name': 'test-folder2',
+        'id': 'c0284dc3-841d-48b2-955c-bcb2218e2b03',
+        'nodeType': 'cm:folder',
+        'parentId': '1ee81bf8-52d6-4cfc-a924-1efbc79306bf'
+    }
+};
+
+let exampleFolderWithPermissions = {
+    'entry': {
+        'aspectNames': ['cm:auditable'],
+        'allowableOperations': ['check'],
+        'createdAt': '2017-04-03T11:34:35.708+0000',
+        'isFolder': true,
+        'isFile': false,
+        'createdByUser': { 'id': 'admin', 'displayName': 'Administrator' },
+        'modifiedAt': '2017-04-03T11:34:35.708+0000',
+        'modifiedByUser': { 'id': 'admin', 'displayName': 'Administrator' },
+        'name': 'test-folder2',
+        'id': 'c0284dc3-841d-48b2-955c-bcb2218e2b03',
+        'nodeType': 'cm:folder',
+        'parentId': '1ee81bf8-52d6-4cfc-a924-1efbc79306bf'
+    }
+};
+
+let exampleFolderWithNoOperations = {
+    'entry': {
+        'aspectNames': ['cm:auditable'],
+        'createdAt': '2017-04-03T11:34:35.708+0000',
+        'isFolder': true,
+        'isFile': false,
+        'createdByUser': { 'id': 'admin', 'displayName': 'Administrator' },
+        'modifiedAt': '2017-04-03T11:34:35.708+0000',
+        'modifiedByUser': { 'id': 'admin', 'displayName': 'Administrator' },
+        'name': 'test-folder2',
+        'id': 'c0284dc3-841d-48b2-955c-bcb2218e2b03',
+        'nodeType': 'cm:folder',
+        'parentId': '1ee81bf8-52d6-4cfc-a924-1efbc79306bf'
+    }
+};
+
 describe('Document menu action', () => {
 
     let component: DocumentMenuActionComponent;
@@ -50,6 +102,9 @@ describe('Document menu action', () => {
         });
 
         TestBed.compileComponents();
+
+        let translateService = TestBed.get(AlfrescoTranslationService);
+        spyOn(translateService, 'get').and.returnValue({ value: 'fake translated message' });
     }));
 
     beforeEach(() => {
@@ -69,7 +124,7 @@ describe('Document menu action', () => {
     describe('Folder creation', () => {
 
         it('should createFolder fire a success event if the folder has been created', (done) => {
-
+            component.allowableOperations = ['create'];
             component.showDialog();
 
             component.createFolder('test-folder');
@@ -81,26 +136,12 @@ describe('Document menu action', () => {
             jasmine.Ajax.requests.mostRecent().respondWith({
                 status: 200,
                 contentType: 'application/json',
-                responseText: JSON.stringify({
-                    'entry': {
-                        'aspectNames': ['cm:auditable'],
-                        'createdAt': '2017-04-03T11:34:35.708+0000',
-                        'isFolder': true,
-                        'isFile': false,
-                        'createdByUser': {'id': 'admin', 'displayName': 'Administrator'},
-                        'modifiedAt': '2017-04-03T11:34:35.708+0000',
-                        'modifiedByUser': {'id': 'admin', 'displayName': 'Administrator'},
-                        'name': 'test-folder2',
-                        'id': 'c0284dc3-841d-48b2-955c-bcb2218e2b03',
-                        'nodeType': 'cm:folder',
-                        'parentId': '1ee81bf8-52d6-4cfc-a924-1efbc79306bf'
-                    }
-                })
+                responseText: JSON.stringify(exampleFolderWithCreate)
             });
         });
 
         it('should createFolder fire an error event if the folder has not been created', (done) => {
-
+            component.allowableOperations = ['create'];
             component.showDialog();
 
             component.createFolder('test-folder');
@@ -113,5 +154,118 @@ describe('Document menu action', () => {
                 status: 403
             });
         });
+
+        it('should createFolder fire an error when folder already exists', (done) => {
+            component.allowableOperations = ['create'];
+            component.showDialog();
+
+            component.createFolder('test-folder');
+
+            component.error.subscribe((err) => {
+                expect(err.message).toEqual('fake translated message');
+                done();
+            });
+
+            jasmine.Ajax.requests.mostRecent().respondWith({
+                status: 403,
+                responseText: JSON.stringify({ message: 'Fake folder exists', error: { statusCode: 409 } })
+            });
+        });
+    });
+
+    describe('Check Permissions', () => {
+
+        it('should get the folder permission when folderId is changed', async(() => {
+            let change = new SimpleChange('folder-id', 'new-folder-id');
+            component.ngOnChanges({ 'folderId': change });
+
+            jasmine.Ajax.requests.mostRecent().respondWith({
+                status: 200,
+                contentType: 'application/json',
+                responseText: JSON.stringify(exampleFolderWithCreate)
+            });
+
+            fixture.whenStable().then(() => {
+                fixture.detectChanges();
+                let createButton: HTMLButtonElement = <HTMLButtonElement> element.querySelector('#folder-create-button');
+                expect(createButton).toBeDefined();
+                expect(component.allowableOperations).toBeDefined();
+                expect(component.allowableOperations).not.toBeNull();
+                expect(createButton.disabled).toBeFalsy();
+            });
+        }));
+
+        it('should disable the create button if folder does not have any allowable operations', async(() => {
+            let change = new SimpleChange('folder-id', 'new-folder-id');
+            component.ngOnChanges({ 'folderId': change });
+
+            jasmine.Ajax.requests.mostRecent().respondWith({
+                status: 200,
+                contentType: 'application/json',
+                responseText: JSON.stringify(exampleFolderWithNoOperations)
+            });
+            fixture.detectChanges();
+            fixture.whenStable().then(() => {
+                fixture.detectChanges();
+                let createButton: HTMLButtonElement = <HTMLButtonElement> element.querySelector('#folder-create-button');
+                expect(createButton).toBeDefined();
+                expect(createButton.disabled).toBeTruthy();
+            });
+        }));
+
+        it('should disable the create button if folder does not have create permission', async(() => {
+            let change = new SimpleChange('folder-id', 'new-folder-id');
+            component.ngOnChanges({ 'folderId': change });
+
+            jasmine.Ajax.requests.mostRecent().respondWith({
+                status: 200,
+                contentType: 'application/json',
+                responseText: JSON.stringify(exampleFolderWithPermissions)
+            });
+            fixture.detectChanges();
+            fixture.whenStable().then(() => {
+                fixture.detectChanges();
+                let createButton: HTMLButtonElement = <HTMLButtonElement> element.querySelector('#folder-create-button');
+                expect(createButton).toBeDefined();
+                expect(createButton.disabled).toBeTruthy();
+            });
+        }));
+
+        it('should not disable the option when disableWithNoPermission is false', async(() => {
+            component.disableWithNoPermission = false;
+            let change = new SimpleChange('folder-id', 'new-folder-id');
+            component.ngOnChanges({ 'folderId': change });
+
+            jasmine.Ajax.requests.mostRecent().respondWith({
+                status: 200,
+                contentType: 'application/json',
+                responseText: JSON.stringify(exampleFolderWithNoOperations)
+            });
+
+            fixture.whenStable().then(() => {
+                fixture.detectChanges();
+                let createButton: HTMLButtonElement = <HTMLButtonElement> element.querySelector('#folder-create-button');
+                expect(createButton).toBeDefined();
+                expect(createButton.disabled).toBeFalsy();
+            });
+        }));
+
+        it('should emit permission event error when user does not have create permission', async(() => {
+            let change = new SimpleChange('folder-id', 'new-folder-id');
+            component.ngOnChanges({ 'folderId': change });
+
+            jasmine.Ajax.requests.mostRecent().respondWith({
+                status: 200,
+                contentType: 'application/json',
+                responseText: JSON.stringify(exampleFolderWithNoOperations)
+            });
+
+            component.permissionErrorEvent.subscribe((error) => {
+                expect(error.type).toEqual('folder');
+                expect(error.action).toEqual('create');
+            });
+            component.showDialog();
+            component.createFolder('not-allowed');
+        }));
     });
 });
diff --git a/ng2-components/ng2-alfresco-documentlist/src/components/document-menu-action.component.ts b/ng2-components/ng2-alfresco-documentlist/src/components/document-menu-action.component.ts
index df9c8f34cd..e6f4f9ce94 100644
--- a/ng2-components/ng2-alfresco-documentlist/src/components/document-menu-action.component.ts
+++ b/ng2-components/ng2-alfresco-documentlist/src/components/document-menu-action.component.ts
@@ -15,12 +15,13 @@
  * limitations under the License.
  */
 
-import { Component, Input, Output, EventEmitter, ViewChild } from '@angular/core';
+import { Component, Input, Output, EventEmitter, ViewChild, OnChanges, SimpleChanges } from '@angular/core';
 import { AlfrescoTranslationService, LogService } from 'ng2-alfresco-core';
 import { MinimalNodeEntity } from 'alfresco-js-api';
 
 import { DocumentListService } from './../services/document-list.service';
 import { ContentActionModel } from './../models/content-action.model';
+import { PermissionModel } from '../models/permissions.model';
 
 declare let dialogPolyfill: any;
 
@@ -32,17 +33,23 @@ const ERROR_FOLDER_ALREADY_EXIST = 409;
     styleUrls: ['./document-menu-action.component.css'],
     templateUrl: './document-menu-action.component.html'
 })
-export class DocumentMenuActionComponent {
+export class DocumentMenuActionComponent implements OnChanges {
 
     @Input()
     folderId: string;
 
+    @Input()
+    disableWithNoPermission: boolean = true;
+
     @Output()
     success = new EventEmitter();
 
     @Output()
     error = new EventEmitter();
 
+    @Output()
+    permissionErrorEvent = new EventEmitter();
+
     @ViewChild('dialog')
     dialog: any;
 
@@ -52,6 +59,8 @@ export class DocumentMenuActionComponent {
 
     folderName: string = '';
 
+    allowableOperations: string[];
+
     constructor(private documentListService: DocumentListService,
                 private translateService: AlfrescoTranslationService,
                 private logService: LogService) {
@@ -61,27 +70,43 @@ export class DocumentMenuActionComponent {
         }
     }
 
+    ngOnChanges(changes: SimpleChanges) {
+        if (changes && changes['folderId']) {
+            if (changes['folderId'].currentValue !== changes['folderId'].previousValue) {
+                this.loadCurrentNodePermissions(changes['folderId'].currentValue);
+            }
+        }
+    }
+
     public createFolder(name: string) {
         this.cancel();
-        this.documentListService.createFolder(name, this.folderId)
-            .subscribe(
-                (res: MinimalNodeEntity) => {
-                    this.folderName = '';
-                    this.logService.info(res.entry);
-                    this.success.emit({node: res.entry});
-                },
-                error => {
-                    if (error.response) {
-                        let errorMessagePlaceholder = this.getErrorMessage(error.response);
-                        this.message = this.formatString(errorMessagePlaceholder, [name]);
-                        this.error.emit({message: this.message});
-                        this.logService.error(this.message);
-                    } else {
-                        this.error.emit(error);
-                        this.logService.error(error);
+        if (this.hasCreatePermission()) {
+            this.documentListService.createFolder(name, this.folderId)
+                .subscribe(
+                    (res: MinimalNodeEntity) => {
+                        this.folderName = '';
+                        this.logService.info(res.entry);
+                        this.success.emit({ node: res.entry });
+                    },
+                    error => {
+                        if (error.response) {
+                            let errorMessagePlaceholder = this.getErrorMessage(error.response);
+                            this.message = this.formatString(errorMessagePlaceholder, [name]);
+                            this.error.emit({ message: this.message });
+                            this.logService.error(this.message);
+                        } else {
+                            this.error.emit(error);
+                            this.logService.error(error);
+                        }
                     }
-                }
-            );
+                );
+        } else {
+            this.permissionErrorEvent.emit(new PermissionModel({
+                type: 'folder',
+                action: 'create',
+                permission: 'create'
+            }));
+        }
     }
 
     public showDialog() {
@@ -127,4 +152,27 @@ export class DocumentMenuActionComponent {
     isFolderNameEmpty() {
         return this.folderName === '' ? true : false;
     }
+
+    isButtonDisabled(): boolean {
+        return !this.hasCreatePermission() && this.disableWithNoPermission ? true : undefined;
+    }
+
+    hasPermission(permission: string): boolean {
+        let hasPermission: boolean = false;
+        if (this.allowableOperations) {
+            let permFound = this.allowableOperations.find(element => element === permission);
+            hasPermission = permFound ? true : false;
+        }
+        return hasPermission;
+    }
+
+    hasCreatePermission() {
+        return this.hasPermission('create');
+    }
+
+    loadCurrentNodePermissions(nodeId: string) {
+        this.documentListService.getFolderNode(nodeId).then(node => {
+            this.allowableOperations = node ? node['allowableOperations'] : null;
+        }).catch(err => this.error.emit(err));
+    }
 }