diff --git a/fn.go b/fn.go
index 31d2f33..6400124 100644
--- a/fn.go
+++ b/fn.go
@@ -57,6 +57,8 @@ func (f *Function) RunFunction(_ context.Context, req *fnv1beta1.RunFunctionRequ
 		return rsp, nil
 	}
 
+	f.log.Debug("template", "template", tg.GetTemplates())
+
 	tmpl, err := GetNewTemplateWithFunctionMaps(in.Delims).Parse(tg.GetTemplates())
 	if err != nil {
 		response.Fatal(rsp, errors.Wrap(err, "invalid function input: cannot parse the provided templates"))
diff --git a/template.go b/template.go
index 990741b..ccfa4c1 100644
--- a/template.go
+++ b/template.go
@@ -83,11 +83,21 @@ func newFileSource(in *v1beta1.GoTemplate) (*FileSource, error) {
 func readTemplates(dir string) (string, error) {
 	tmpl := ""
 
-	if err := filepath.Walk(dir, func(path string, info os.FileInfo, e error) error {
+	if err := filepath.WalkDir(dir, func(path string, dirEntry os.DirEntry, e error) error {
 		if e != nil {
 			return e
 		}
 
+		// skip hidden directories
+		if dirEntry.IsDir() && dirEntry.Name()[0] == dotCharacter {
+			return filepath.SkipDir
+		}
+
+		info, err := dirEntry.Info()
+		if err != nil {
+			return err
+		}
+
 		// check for directory and hidden files/folders
 		if info.IsDir() || info.Name()[0] == dotCharacter {
 			return nil
diff --git a/testdata/templates/..shouldBeSkipped/_helpers.tpl b/testdata/templates/..shouldBeSkipped/_helpers.tpl
new file mode 100644
index 0000000..765d3f5
--- /dev/null
+++ b/testdata/templates/..shouldBeSkipped/_helpers.tpl
@@ -0,0 +1,3 @@
+{{- define "common-labels" -}}
+testLabel: "testValue"
+{{- end }}
\ No newline at end of file
diff --git a/testdata/templates/..shouldBeSkipped/resource.yaml b/testdata/templates/..shouldBeSkipped/resource.yaml
new file mode 100644
index 0000000..bbe31ab
--- /dev/null
+++ b/testdata/templates/..shouldBeSkipped/resource.yaml
@@ -0,0 +1,23 @@
+apiVersion: kubernetes.crossplane.io/v1alpha1
+kind: Object
+metadata:
+  annotations:
+    gotemplating.fn.crossplane.io/composition-resource-name: test
+  labels:
+    {{- include "common-labels" . | nindent 4}}
+spec:
+  providerConfigRef:
+    name: default
+  forProvider:
+    manifest:
+      apiVersion: v1
+      kind: ConfigMap
+      metadata:
+        name: test-001
+        namespace: test
+        labels:
+          {{- include "common-labels" . | nindent 10}}
+      data:
+        test: |
+          spec:
+            resources: []
\ No newline at end of file