diff --git a/rapyuta_io/clients/paramserver.py b/rapyuta_io/clients/paramserver.py
index 7b7bf6be..ef6e56f9 100644
--- a/rapyuta_io/clients/paramserver.py
+++ b/rapyuta_io/clients/paramserver.py
@@ -3,6 +3,7 @@
 import enum
 import errno
 import hashlib
+import json
 import mimetypes
 import os
 import tempfile
@@ -151,10 +152,16 @@ def process_dir(self, executor, rootdir, tree_path, level, dir_futures, file_fut
                     future = executor.submit(self.create_binary_file, new_tree_path, full_path)
                 if file_name.endswith('.yaml'):
                     data = parse_yaml(full_path)
-                    future = executor.submit(self.create_file, new_tree_path, data)
+                    if self.should_upload_as_binary(data, self.yaml_content_type):
+                        future = executor.submit(self.create_binary_file, new_tree_path, full_path)
+                    else:
+                        future = executor.submit(self.create_file, new_tree_path, data)
                 elif file_name.endswith('.json'):
                     data = parse_json(full_path)
-                    future = executor.submit(self.create_file, new_tree_path, data, content_type=self.json_content_type)
+                    if self.should_upload_as_binary(data, self.json_content_type):
+                        future = executor.submit(self.create_binary_file, new_tree_path, full_path)
+                    else:
+                        future = executor.submit(self.create_file, new_tree_path, data, content_type=self.json_content_type)
                 else:
                     future = executor.submit(self.create_binary_file, new_tree_path, full_path)
                 file_futures[future] = new_tree_path
@@ -167,22 +174,45 @@ def process_folder(self, executor, rootdir, tree_path, level, dir_futures, file_
             if isdir(full_path):
                 future = executor.submit(self.create_folder, new_tree_path)
                 dir_futures[future] = (new_tree_path, level + 1)
-            else:
-                file_stat = os.stat(full_path)
-                file_name = os.path.basename(full_path)
-                if file_stat.st_size > self.max_non_binary_size:
+                continue
+            file_stat = os.stat(full_path)
+            file_name = os.path.basename(full_path)
+            if file_stat.st_size > self.max_non_binary_size:
+                future = executor.submit(self.create_binary_file, new_tree_path, full_path)
+            elif file_name.endswith('.yaml'):
+                data = parse_yaml(full_path)
+                if self.should_upload_as_binary(data, self.yaml_content_type):
                     future = executor.submit(self.create_binary_file, new_tree_path, full_path)
-                elif file_name.endswith('.yaml'):
-                    data = parse_yaml(full_path)
-                    future = executor.submit(self.create_file, new_tree_path, data)
-                elif file_name.endswith('.json'):
-                    data = parse_json(full_path)
-                    future = executor.submit(self.create_file, new_tree_path, data, content_type=self.json_content_type)
                 else:
+                    future = executor.submit(self.create_file, new_tree_path, data)
+            elif file_name.endswith('.json'):
+                data = parse_json(full_path)
+                if self.should_upload_as_binary(data, self.json_content_type):
                     future = executor.submit(self.create_binary_file, new_tree_path, full_path)
-                file_futures[future] = new_tree_path
+                else:
+                    future = executor.submit(self.create_file, new_tree_path, data, content_type=self.json_content_type)
+            else:
+                future = executor.submit(self.create_binary_file, new_tree_path, full_path)
+            file_futures[future] = new_tree_path
+
         return dir_futures, file_futures
 
+    def should_upload_as_binary(self, filedata, content_type):
+        """Determines if the file should be uploaded as binary based on the file size
+
+        While the file data may be less than the supported limit, the combined size of
+        the API payload is what is stored by paramserver. This method calculates the
+        size of the payload and determines if it exceeds the supported limit. If it does,
+        the file is uploaded as a binary to the blob store.
+
+        We cannot entirely rely on the file stat result since the file data is sent as
+        a string in the API payload and the final size inflates when json.dumps is
+        performed on the final payload.
+        """
+        metadata_size_buffer = 100  # In bytes
+        payload = {'type': _Node.File, 'data': filedata, 'contentType': content_type}
+        return len(json.dumps(payload)) + metadata_size_buffer > self.max_non_binary_size
+
     def upload_configurations(self, rootdir, tree_names, delete_existing_trees, as_folder=False):
         self.validate_args(rootdir, tree_names, delete_existing_trees, as_folder)
         with futures.ThreadPoolExecutor(max_workers=15) as executor: