diff --git a/lib/protocol/http2/connection.rb b/lib/protocol/http2/connection.rb
index 8506eda..8e78284 100644
--- a/lib/protocol/http2/connection.rb
+++ b/lib/protocol/http2/connection.rb
@@ -62,8 +62,9 @@ def maximum_frame_size
 				@remote_settings.maximum_frame_size
 			end
 			
+			# The maximum number of concurrent streams that this connection can initiate:
 			def maximum_concurrent_streams
-				@local_settings.maximum_concurrent_streams
+				@remote_settings.maximum_concurrent_streams
 			end
 			
 			attr :framer
@@ -389,7 +390,8 @@ def receive_headers(frame)
 						raise ProtocolError, "Invalid stream id: #{stream_id} <= #{@remote_stream_id}!"
 					end
 					
-					if @streams.size < self.maximum_concurrent_streams
+					# We need to validate that we have less streams than the specified maximum:
+					if @streams.size < @local_settings.maximum_concurrent_streams
 						stream = accept_stream(stream_id)
 						@remote_stream_id = stream_id
 						
diff --git a/test/protocol/http2/connection.rb b/test/protocol/http2/connection.rb
index fe0fbe8..4de8fd8 100644
--- a/test/protocol/http2/connection.rb
+++ b/test/protocol/http2/connection.rb
@@ -11,6 +11,29 @@
 	let(:framer) {Protocol::HTTP2::Framer.new(stream)}
 	let(:connection) {subject.new(framer, 1)}
 	
+	with "#maximum_concurrent_streams" do
+		it "is the remote peer's maximum concurrent streams" do
+			connection.remote_settings.maximum_concurrent_streams = 10
+			connection.local_settings.current.maximum_concurrent_streams = 5
+			
+			expect(connection.maximum_concurrent_streams).to be == 10
+		end
+	end
+	
+	with '#receive_headers' do
+		it "fails with protocol error if exceeding the maximum concurrent connections" do
+			connection.local_settings.current.maximum_concurrent_streams = 1
+			# Create a stream to 
+			connection.streams[1] = Protocol::HTTP2::Stream.new(connection, 1)
+			
+			frame = Protocol::HTTP2::HeadersFrame.new(3)
+			
+			expect do
+				connection.receive_headers(frame)
+			end.to raise_exception(Protocol::HTTP2::ProtocolError, message: be =~ /Exceeded maximum concurrent streams/)
+		end
+	end
+	
 	it "reports the connection id 0 is not closed" do
 		expect(connection).not.to be(:closed_stream_id?, 0)
 	end