diff --git a/lib/directory.js b/lib/directory.js
index 9dc49ae..487f974 100755
--- a/lib/directory.js
+++ b/lib/directory.js
@@ -113,7 +113,7 @@ exports.handler = function (route, options) {
                 error = err;
             }
 
-            // Not found
+            // Handle Not found
 
             if (internals.isNotFound(error)) {
                 if (settings.defaultExtension) {
@@ -138,55 +138,40 @@ exports.handler = function (route, options) {
                 return;
             }
 
-            // Propagate non-directory errors
+            // Handle Directory
 
-            if (!internals.isDirectory(error)) {
+            if (internals.isDirectory(error)) {
+                if (settings.redirectToSlash !== false &&                       // Defaults to true
+                    !request.server.settings.router.stripTrailingSlash &&
+                    !hasTrailingSlash) {
 
-                throw error;
-            }
-
-            // Directory
-
-            if (!indexNames.length &&
-                !settings.listing) {
-
-                throw error;
-            }
-
-            if (settings.redirectToSlash !== false &&                       // Defaults to true
-                !request.server.settings.router.stripTrailingSlash &&
-                !hasTrailingSlash) {
-
-                return reply.redirect(resource + '/');
-            }
-
-            for (let i = 0; i < indexNames.length; ++i) {
-                const indexName = indexNames[i];
-
-                const indexFile = Path.join(path, indexName);
-                try {
-                    // File loaded successfully
-
-                    return await File.load(indexFile, request, fileOptions);
+                    return reply.redirect(resource + '/');
                 }
-                catch (err) {
-                    Bounce.ignore(err, 'boom');
 
-                    // Directory
+                for (const indexName of indexNames) {
+                    const indexFile = Path.join(path, indexName);
+                    try {
+                        return await File.load(indexFile, request, fileOptions);
+                    }
+                    catch (err) {
+                        Bounce.ignore(err, 'boom');
+
+                        if (!internals.isNotFound(err)) {
+                            throw Boom.internal(indexName + ' is a directory', err);
+                        }
 
-                    if (!internals.isNotFound(err)) {
-                        throw Boom.badImplementation(indexName + ' is a directory');
+                        // Not found - try next
                     }
                 }
-            }
 
-            // None of the index files were found
+                // None of the index files were found
 
-            if (!settings.listing) {
-                throw Boom.forbidden();
+                if (settings.listing) {
+                    return internals.generateListing(Path.join(baseDir, path), resource, selection, hasTrailingSlash, settings, request);
+                }
             }
 
-            return await internals.generateListing(Path.join(baseDir, path), resource, selection, hasTrailingSlash, settings, request);
+            throw error;
         };
 
         for (let i = 0; i < paths.length; ++i) {
diff --git a/test/directory.js b/test/directory.js
index b002987..93e7f66 100755
--- a/test/directory.js
+++ b/test/directory.js
@@ -117,6 +117,20 @@ describe('directory', () => {
             expect(res.payload).to.contain('name": "inert"');
         });
 
+        it('returns 404 when the a fn directory handler returns an empty array', async () => {
+
+            const directoryFn = (request) => {
+
+                return [];
+            };
+
+            const server = await provisionServer();
+            server.route({ method: 'GET', path: '/directoryfn/{path?}', handler: { directory: { path: directoryFn } } });
+
+            const res = await server.inject('/directoryfn/index.js');
+            expect(res.statusCode).to.equal(404);
+        });
+
         it('returns the correct file when requesting a file from a child directory', async () => {
 
             const server = await provisionServer();
@@ -525,6 +539,15 @@ describe('directory', () => {
             expect(res.statusCode).to.equal(404);
         });
 
+        it('appends default extension and errors on file', async () => {
+
+            const server = await provisionServer();
+            server.route({ method: 'GET', path: '/directory/{path*}', handler: { directory: { path: __dirname, defaultExtension: 'dir' } } });
+
+            const res = await server.inject('/directory/directory/index');
+            expect(res.statusCode).to.equal(403);
+        });
+
         it('does not append default extension when directory exists', async () => {
 
             const server = await provisionServer();
diff --git a/test/directory/index.dir/.gitempty b/test/directory/index.dir/.gitempty
new file mode 100644
index 0000000..e69de29