diff --git a/src/vs/workbench/services/uriIdentity/common/uriIdentityService.ts b/src/vs/workbench/services/uriIdentity/common/uriIdentityService.ts
index b0b670bdc81..1b2fc624c9c 100644
--- a/src/vs/workbench/services/uriIdentity/common/uriIdentityService.ts
+++ b/src/vs/workbench/services/uriIdentity/common/uriIdentityService.ts
@@ -6,9 +6,11 @@
 import { IUriIdentityService } from 'vs/workbench/services/uriIdentity/common/uriIdentity';
 import { URI } from 'vs/base/common/uri';
 import { registerSingleton } from 'vs/platform/instantiation/common/extensions';
-import { IFileService, FileSystemProviderCapabilities } from 'vs/platform/files/common/files';
+import { IFileService, FileSystemProviderCapabilities, IFileSystemProviderCapabilitiesChangeEvent, IFileSystemProviderRegistrationEvent } from 'vs/platform/files/common/files';
 import { ExtUri, IExtUri, normalizePath } from 'vs/base/common/resources';
 import { SkipList } from 'vs/base/common/skipList';
+import { Event } from 'vs/base/common/event';
+import { DisposableStore } from 'vs/base/common/lifecycle';
 
 class Entry {
 	static _clock = 0;
@@ -26,27 +28,45 @@ export class UriIdentityService implements IUriIdentityService {
 
 	readonly extUri: IExtUri;
 
+	private readonly _dispooables = new DisposableStore();
 	private readonly _canonicalUris: SkipList<URI, Entry>;
 	private readonly _limit = 2 ** 16;
 
 	constructor(@IFileService private readonly _fileService: IFileService) {
 
-		// assume path casing matters unless the file system provider spec'ed the opposite
+		const schemeIgnoresPathCasingCache = new Map<string, boolean>();
+
+		// assume path casing matters unless the file system provider spec'ed the opposite.
+		// for all other cases path casing matters, e.g for
+		// * virtual documents
+		// * in-memory uris
+		// * all kind of "private" schemes
 		const ignorePathCasing = (uri: URI): boolean => {
-			// perf@jrieken cache this information
-			if (this._fileService.canHandleResource(uri)) {
-				return !this._fileService.hasCapability(uri, FileSystemProviderCapabilities.PathCaseSensitive);
+			let ignorePathCasing = schemeIgnoresPathCasingCache.get(uri.scheme);
+			if (ignorePathCasing === undefined) {
+				// retrieve once and then case per scheme until a change happens
+				ignorePathCasing = _fileService.canHandleResource(uri) && !this._fileService.hasCapability(uri, FileSystemProviderCapabilities.PathCaseSensitive);
+				schemeIgnoresPathCasingCache.set(uri.scheme, ignorePathCasing);
 			}
-			// this defaults to false which is a good default for
-			// * virtual documents
-			// * in-memory uris
-			// * all kind of "private" schemes
-			return false;
+			return ignorePathCasing;
 		};
+		this._dispooables.add(Event.any<IFileSystemProviderCapabilitiesChangeEvent | IFileSystemProviderRegistrationEvent>(
+			_fileService.onDidChangeFileSystemProviderRegistrations,
+			_fileService.onDidChangeFileSystemProviderCapabilities
+		)(e => {
+			// remove from cache
+			schemeIgnoresPathCasingCache.delete(e.scheme);
+		}));
+
 		this.extUri = new ExtUri(ignorePathCasing);
 		this._canonicalUris = new SkipList((a, b) => this.extUri.compare(a, b, true), this._limit);
 	}
 
+	dispose(): void {
+		this._dispooables.dispose();
+		this._canonicalUris.clear();
+	}
+
 	asCanonicalUri(uri: URI): URI {
 
 		// (1) normalize URI
diff --git a/src/vs/workbench/services/uriIdentity/test/common/uriIdentityService.test.ts b/src/vs/workbench/services/uriIdentity/test/common/uriIdentityService.test.ts
index ea422ca1a14..683fb6675d7 100644
--- a/src/vs/workbench/services/uriIdentity/test/common/uriIdentityService.test.ts
+++ b/src/vs/workbench/services/uriIdentity/test/common/uriIdentityService.test.ts
@@ -8,11 +8,15 @@ import { UriIdentityService } from 'vs/workbench/services/uriIdentity/common/uri
 import { mock } from 'vs/workbench/test/common/workbenchTestServices';
 import { IFileService, FileSystemProviderCapabilities } from 'vs/platform/files/common/files';
 import { URI } from 'vs/base/common/uri';
+import { Event } from 'vs/base/common/event';
 
 suite('URI Identity', function () {
 
 	class FakeFileService extends mock<IFileService>() {
 
+		onDidChangeFileSystemProviderCapabilities = Event.None;
+		onDidChangeFileSystemProviderRegistrations = Event.None;
+
 		constructor(readonly data: Map<string, FileSystemProviderCapabilities>) {
 			super();
 		}