diff --git a/lang/driver/src/database.rs b/lang/driver/src/database.rs
index bf2369a48e..fe5d17a246 100644
--- a/lang/driver/src/database.rs
+++ b/lang/driver/src/database.rs
@@ -383,9 +383,8 @@ impl Database {
     }
 
     /// Invalidate the file behind the given URI and all its reverse dependencies
-    pub async fn invalidate(&mut self, uri: &Url) -> Result<(), Error> {
+    pub async fn invalidate(&mut self, uri: &Url) {
         self.invalidate_impl(uri);
-        self.build_dependency_dag().await?;
         let rev_deps: HashSet<Url> =
             self.deps.reverse_dependencies(uri).into_iter().cloned().collect();
         log::debug!(
@@ -396,7 +395,6 @@ impl Database {
         for rev_dep in &rev_deps {
             self.invalidate_impl(rev_dep);
         }
-        Ok(())
     }
 
     fn invalidate_impl(&mut self, uri: &Url) {
@@ -432,7 +430,7 @@ impl Database {
     }
 
     pub async fn write_source(&mut self, uri: &Url, source: &str) -> Result<(), Error> {
-        self.invalidate(uri).await?;
+        self.invalidate(uri).await;
         self.source.write_string(uri, source).await.map_err(|err| err.into())
     }
 
diff --git a/lang/driver/src/fs.rs b/lang/driver/src/fs.rs
index 1d715f63a6..02a951e5b1 100644
--- a/lang/driver/src/fs.rs
+++ b/lang/driver/src/fs.rs
@@ -16,6 +16,11 @@ pub trait FileSource: Send + Sync {
     fn manage(&mut self, uri: &Url) -> bool;
     /// Check if the source manages a file with the given URI
     fn manages(&self, uri: &Url) -> bool;
+    /// Stop managing a file with the given URI
+    ///
+    /// This is mostly relevant for in-memory sources.
+    /// Returns `true` if the source was managing the file.
+    fn forget(&mut self, uri: &Url) -> bool;
     /// Read the contents of a file with the given URI
     async fn read_to_string(&mut self, uri: &Url) -> Result<String, DriverError>;
     /// Write the contents of a file with the given URI
@@ -61,6 +66,11 @@ mod file_system {
             self.root.join(filepath).exists()
         }
 
+        fn forget(&mut self, uri: &Url) -> bool {
+            let filepath = uri.to_file_path().expect("Failed to convert URI to filepath");
+            self.root.join(filepath).exists()
+        }
+
         async fn read_to_string(&mut self, uri: &Url) -> Result<String, DriverError> {
             let filepath = uri.to_file_path().expect("Failed to convert URI to filepath");
             let path = self.root.join(filepath);
@@ -116,6 +126,12 @@ impl FileSource for InMemorySource {
         self.files.contains_key(uri)
     }
 
+    fn forget(&mut self, uri: &Url) -> bool {
+        let managed = self.files.remove(uri).is_some();
+        self.modified.remove(uri);
+        managed
+    }
+
     async fn read_to_string(&mut self, uri: &Url) -> Result<String, DriverError> {
         if self.manages(uri) {
             self.modified.insert(uri.clone(), false);
@@ -158,6 +174,10 @@ where
         self.first.manages(uri) || self.second.manages(uri)
     }
 
+    fn forget(&mut self, uri: &Url) -> bool {
+        self.first.forget(uri) || self.second.forget(uri)
+    }
+
     async fn read_to_string(&mut self, uri: &Url) -> Result<String, DriverError> {
         match self.first.read_to_string(uri).await {
             Ok(source) => Ok(source),
diff --git a/lang/lsp/src/diagnostics.rs b/lang/lsp/src/diagnostics.rs
index e6dc767376..18f4917cf3 100644
--- a/lang/lsp/src/diagnostics.rs
+++ b/lang/lsp/src/diagnostics.rs
@@ -11,17 +11,38 @@ use miette_util::FromMiette;
 use crate::conversion::ToLsp;
 
 pub trait Diagnostics {
-    fn diagnostics(&self, uri: &Url, result: Result<(), Error>) -> Vec<lsp_types::Diagnostic> {
-        match result {
-            Ok(()) => vec![],
-            Err(err) => self.error_diagnostics(uri, err),
-        }
-    }
+    /// Compute the diagnostics for the given URI and all of its reverse dependencies.
+    async fn diagnostics(&mut self, uri: &Url, result: Result<(), Error>) -> DiagnosticsPerUri;
 
     fn error_diagnostics(&self, uri: &Url, error: Error) -> Vec<lsp_types::Diagnostic>;
 }
 
+pub type DiagnosticsPerUri = ast::HashMap<Url, Vec<lsp_types::Diagnostic>>;
+
 impl Diagnostics for Database {
+    async fn diagnostics(&mut self, uri: &Url, result: Result<(), Error>) -> DiagnosticsPerUri {
+        // When computing the diagnostics for an URI, we also need to recompute the diagnostics for all of its reverse dependencies.
+        let rev_deps: Vec<_> = self.deps.reverse_dependencies(uri).into_iter().cloned().collect();
+        let mut diagnostics = ast::HashMap::default();
+
+        for uri in rev_deps {
+            let mut diagnostics_for_uri = vec![];
+            let ast = self.ast(&uri).await;
+            if let Err(err) = ast {
+                diagnostics_for_uri.extend(self.error_diagnostics(&uri, err));
+            }
+            diagnostics.insert(uri, diagnostics_for_uri);
+        }
+
+        if let Err(err) = result {
+            diagnostics.insert(uri.clone(), self.error_diagnostics(uri, err));
+        } else {
+            diagnostics.insert(uri.clone(), vec![]);
+        }
+
+        diagnostics
+    }
+
     fn error_diagnostics(&self, uri: &Url, error: Error) -> Vec<lsp_types::Diagnostic> {
         // Compute the range where the error should be displayed.
         // The range is computed from the first available label, otherwise
diff --git a/lang/lsp/src/server.rs b/lang/lsp/src/server.rs
index 6aa3481973..7fa1b17630 100644
--- a/lang/lsp/src/server.rs
+++ b/lang/lsp/src/server.rs
@@ -6,7 +6,7 @@ use driver::Database;
 #[cfg(not(target_arch = "wasm32"))]
 use driver::{FileSource, FileSystemSource, InMemorySource};
 
-use crate::conversion::FromLsp;
+use crate::conversion::{FromLsp, ToLsp};
 
 use super::capabilities::*;
 use super::diagnostics::*;
@@ -74,8 +74,23 @@ impl LanguageServer for Server {
         source_mut.write_string(&text_document.uri.from_lsp(), &text_document.text).await.unwrap();
 
         let res = db.ast(&text_document.uri.from_lsp()).await.map(|_| ());
-        let diags = db.diagnostics(&text_document.uri.from_lsp(), res);
-        self.send_diagnostics(text_document.uri, diags).await;
+        let diags = db.diagnostics(&text_document.uri.from_lsp(), res).await;
+        self.send_diagnostics(diags).await;
+    }
+
+    async fn did_close(&self, params: DidCloseTextDocumentParams) {
+        let text_document = params.text_document;
+        let mut db = self.database.write().await;
+
+        self.client
+            .log_message(
+                MessageType::INFO,
+                format!("Closed file: {}", text_document.uri.from_lsp()),
+            )
+            .await;
+
+        let source_mut = db.file_source_mut();
+        source_mut.forget(&text_document.uri.from_lsp());
     }
 
     async fn did_change(&self, params: DidChangeTextDocumentParams) {
@@ -96,15 +111,12 @@ impl LanguageServer for Server {
         assert!(source_mut.manage(&text_document.uri.from_lsp()));
         source_mut.write_string(&text_document.uri.from_lsp(), &text).await.unwrap();
 
-        let res = db.invalidate(&text_document.uri.from_lsp()).await;
+        db.invalidate(&text_document.uri.from_lsp()).await;
 
-        let res = match res {
-            Ok(()) => db.ast(&text_document.uri.from_lsp()).await.map(|_| ()),
-            Err(err) => Err(err),
-        };
+        let res = db.ast(&text_document.uri.from_lsp()).await.map(|_| ());
+        let diags = db.diagnostics(&text_document.uri.from_lsp(), res).await;
 
-        let diags = db.diagnostics(&text_document.uri.from_lsp(), res);
-        self.send_diagnostics(text_document.uri, diags).await;
+        self.send_diagnostics(diags).await;
     }
 
     async fn goto_definition(
@@ -131,7 +143,9 @@ impl LanguageServer for Server {
 }
 
 impl Server {
-    pub(crate) async fn send_diagnostics(&self, uri: Uri, diags: Vec<Diagnostic>) {
-        self.client.publish_diagnostics(uri, diags, None).await;
+    pub(crate) async fn send_diagnostics(&self, diags: DiagnosticsPerUri) {
+        for (uri, diags) in diags {
+            self.client.publish_diagnostics(uri.to_lsp(), diags, None).await;
+        }
     }
 }
diff --git a/web/crates/browser/src/source.rs b/web/crates/browser/src/source.rs
index 123133c417..b8e27eb8aa 100644
--- a/web/crates/browser/src/source.rs
+++ b/web/crates/browser/src/source.rs
@@ -19,6 +19,10 @@ impl FileSource for FetchSource {
         true
     }
 
+    fn forget(&mut self, _uri: &reqwest::Url) -> bool {
+        true
+    }
+
     async fn read_to_string(&mut self, uri: &reqwest::Url) -> Result<String, DriverError> {
         let url =
             get_base_url().join(uri.path()).map_err(|_| DriverError::FileNotFound(uri.clone()))?;