diff --git a/deno/lib/consts.ts b/deno/lib/consts.ts
index bc8fd206..c3058ef2 100644
--- a/deno/lib/consts.ts
+++ b/deno/lib/consts.ts
@@ -1,4 +1,5 @@
-export const PUBLIC_SPECIFIER = "netlify:edge";
-export const STAGE1_SPECIFIER = "netlify:bootstrap-stage1";
-export const STAGE2_SPECIFIER = "netlify:bootstrap-stage2";
-export const virtualRoot = "file:///root/";
+export const CUSTOM_LAYER_PREFIX = 'layer:'
+export const PUBLIC_SPECIFIER = 'netlify:edge'
+export const STAGE1_SPECIFIER = 'netlify:bootstrap-stage1'
+export const STAGE2_SPECIFIER = 'netlify:bootstrap-stage2'
+export const virtualRoot = 'file:///root/'
diff --git a/deno/lib/stage2.ts b/deno/lib/stage2.ts
index 8a2355fd..045792be 100644
--- a/deno/lib/stage2.ts
+++ b/deno/lib/stage2.ts
@@ -3,7 +3,7 @@ import { build, LoadResponse } from 'https://deno.land/x/eszip@v0.28.0/mod.ts'
 import * as path from 'https://deno.land/std@0.127.0/path/mod.ts'
 
 import type { InputFunction, WriteStage2Options } from '../../shared/stage2.ts'
-import { PUBLIC_SPECIFIER, STAGE2_SPECIFIER, virtualRoot } from './consts.ts'
+import { CUSTOM_LAYER_PREFIX, PUBLIC_SPECIFIER, STAGE2_SPECIFIER, virtualRoot } from './consts.ts'
 import { inlineModule, loadFromVirtualRoot, loadWithRetry } from './common.ts'
 
 interface FunctionReference {
@@ -70,7 +70,7 @@ const stage2Loader = (basePath: string, functions: InputFunction[]) => {
       return inlineModule(specifier, stage2Entry)
     }
 
-    if (specifier === PUBLIC_SPECIFIER) {
+    if (specifier === PUBLIC_SPECIFIER || specifier.startsWith(CUSTOM_LAYER_PREFIX)) {
       return {
         kind: 'external',
         specifier,
@@ -88,6 +88,9 @@ const stage2Loader = (basePath: string, functions: InputFunction[]) => {
 const writeStage2 = async ({ basePath, destPath, functions, importMapURL }: WriteStage2Options) => {
   const loader = stage2Loader(basePath, functions)
   const bytes = await build([STAGE2_SPECIFIER], loader, importMapURL)
+  const directory = path.dirname(destPath)
+
+  await Deno.mkdir(directory, { recursive: true })
 
   return await Deno.writeFile(destPath, bytes)
 }
diff --git a/node/bundler.test.ts b/node/bundler.test.ts
index a18f4860..d605ba07 100644
--- a/node/bundler.test.ts
+++ b/node/bundler.test.ts
@@ -325,3 +325,38 @@ test('Ignores any user-defined `deno.json` files', async () => {
 
   await deleteAsync([tmpDir.path, denoConfigPath, importMapFile.path], { force: true })
 })
+
+test('Processes a function that imports a custom layer', async () => {
+  const sourceDirectory = resolve(fixturesDir, 'with_layers', 'functions')
+  const tmpDir = await tmp.dir()
+  const declarations = [
+    {
+      function: 'func1',
+      path: '/func1',
+    },
+  ]
+  const layer = { name: 'test', flag: 'edge-functions-layer-test' }
+  const result = await bundle([sourceDirectory], tmpDir.path, declarations, {
+    basePath: fixturesDir,
+    featureFlags: {
+      edge_functions_produce_eszip: true,
+    },
+    layers: [layer],
+  })
+  const generatedFiles = await fs.readdir(tmpDir.path)
+
+  expect(result.functions.length).toBe(1)
+  expect(generatedFiles.length).toBe(2)
+
+  const manifestFile = await fs.readFile(resolve(tmpDir.path, 'manifest.json'), 'utf8')
+  const manifest = JSON.parse(manifestFile)
+  const { bundles, layers } = manifest
+
+  expect(bundles.length).toBe(1)
+  expect(bundles[0].format).toBe('eszip2')
+  expect(generatedFiles.includes(bundles[0].asset)).toBe(true)
+
+  expect(layers).toEqual([layer])
+
+  await fs.rmdir(tmpDir.path, { recursive: true })
+})
diff --git a/node/bundler.ts b/node/bundler.ts
index f6d72de2..9613ed95 100644
--- a/node/bundler.ts
+++ b/node/bundler.ts
@@ -87,6 +87,7 @@ const bundle = async (
     distImportMapPath,
     featureFlags: inputFeatureFlags,
     importMaps,
+    layers,
     onAfterDownload,
     onBeforeDownload,
     systemLogger,
@@ -162,6 +163,7 @@ const bundle = async (
     declarations,
     distDirectory,
     functions,
+    layers,
   })
 
   if (distImportMapPath) {
diff --git a/test/fixtures/with_layers/functions/func1.ts b/test/fixtures/with_layers/functions/func1.ts
new file mode 100644
index 00000000..14b7d131
--- /dev/null
+++ b/test/fixtures/with_layers/functions/func1.ts
@@ -0,0 +1,3 @@
+import { handleRequest } from 'layer:test'
+
+export default (req: Request) => handleRequest(req)