diff --git a/Cargo.lock b/Cargo.lock
index ab30934..f39028c 100644
--- a/Cargo.lock
+++ b/Cargo.lock
@@ -486,7 +486,7 @@ checksum = "589f6da84c646204747d1270a2a5661ea66ed1cced2631d546fdfb155959f9ec"
 
 [[package]]
 name = "yabe-gitops"
-version = "0.1.7"
+version = "0.1.8"
 dependencies = [
  "clap",
  "env_logger",
diff --git a/Cargo.toml b/Cargo.toml
index 2f1e985..eea53ee 100644
--- a/Cargo.toml
+++ b/Cargo.toml
@@ -3,7 +3,7 @@ name = "yabe-gitops"
 description = "GitOps organizer"
 repository = "https://github.com/dvrkn/yabe"
 readme = "README.md"
-version = "0.1.7"
+version = "0.1.8"
 edition = "2021"
 keywords = ["gitops", "kubernetes", "argocd", "yaml", "helm"]
 license = "MIT"
diff --git a/README.md b/README.md
index fa0c3d9..a788177 100644
--- a/README.md
+++ b/README.md
@@ -38,6 +38,7 @@ Options:
       --base-out-path <BASE_OUT_PATH>        (Optional) Base file output path [default: ./base.yaml]
       --sort-config-path <SORT_CONFIG_PATH>  (Optional) Sort configuration file path [default: ./sort-config.yaml], if not provided, will not sort
       --sort-only                            Sort only mode - only sort files without diffing
+      --exclude <EXCLUDE_PATTERN>            Exclude patterns to skip files (e.g., "*.terraform.yaml")
       --config <CONFIG_FILE>                 (Optional) Configuration file
   -h, --help                                 Print help
   -V, --version                              Print version
@@ -94,6 +95,12 @@ Use the --sort-only flag to only sort YAML files without performing any diffing
 
 # Sort files to a specific output directory
 ./yabe --sort-only --sort-config-path sort-config.yaml -o ./sorted-files *.yaml
+
+# Sort files recursively while excluding certain patterns
+./yabe --sort-only --sort-config-path sort-config.yaml -p "**/*.yaml" --exclude "*.terraform.yaml" --exclude "*-template.yaml"
+
+# Sort files in-place while excluding terraform files
+./yabe --sort-only --sort-config-path sort-config.yaml -p "./envs/**/*.yaml" --exclude "*.terraform.yaml" -i
 ```
 
 ### Using Configuration File
@@ -121,6 +128,9 @@ quorum: 60
 base_out_path: "./base_output.yaml"
 sort_config_path: "./sort_config.yaml"
 sort_only: false  # Set to true for sort-only mode
+exclude_patterns:  # Optional: patterns to exclude from sorting
+  - "*.terraform.yaml"
+  - "*-template.yaml"
 ```
 
 Then run the tool with:
diff --git a/src/main.rs b/src/main.rs
index acc538e..df32a3a 100644
--- a/src/main.rs
+++ b/src/main.rs
@@ -63,6 +63,10 @@ struct Args {
     /// Sort only mode - only sort files without diffing
     #[arg(long = "sort-only")]
     sort_only: bool,
+
+    /// Exclude patterns to skip files (e.g., "*.terraform.yaml")
+    #[arg(long = "exclude", value_name = "EXCLUDE_PATTERN")]
+    exclude_patterns: Vec<String>,
 }
 
 #[derive(Deserialize)]
@@ -79,6 +83,7 @@ struct Config {
     base_out_path: Option<String>,
     sort_config_path: Option<String>,
     sort_only: Option<bool>,
+    exclude_patterns: Option<Vec<String>>,
 }
 
 fn sort_only_workflow(args: &Args) -> Result<(), Box<dyn Error>> {
@@ -113,6 +118,41 @@ fn sort_only_workflow(args: &Args) -> Result<(), Box<dyn Error>> {
     expanded_input_files.sort();
     expanded_input_files.dedup();
     
+    // Filter out excluded files
+    if !args.exclude_patterns.is_empty() {
+        let original_count = expanded_input_files.len();
+        expanded_input_files.retain(|file_path| {
+            for exclude_pattern in &args.exclude_patterns {
+                if let Ok(paths) = glob(exclude_pattern) {
+                    for entry in paths {
+                        if let Ok(excluded_path) = entry {
+                            if let Some(excluded_path_str) = excluded_path.to_str() {
+                                if file_path == excluded_path_str {
+                                    info!("Excluding file: {} (matches pattern: {})", file_path, exclude_pattern);
+                                    return false;
+                                }
+                            }
+                        }
+                    }
+                }
+                // Also check if the filename matches the pattern directly
+                if let Some(filename) = Path::new(file_path).file_name() {
+                    if let Some(filename_str) = filename.to_str() {
+                        if glob::Pattern::new(exclude_pattern).map_or(false, |p| p.matches(filename_str)) {
+                            info!("Excluding file: {} (filename matches pattern: {})", file_path, exclude_pattern);
+                            return false;
+                        }
+                    }
+                }
+            }
+            true
+        });
+        let excluded_count = original_count - expanded_input_files.len();
+        if excluded_count > 0 {
+            info!("Excluded {} files based on exclude patterns", excluded_count);
+        }
+    }
+    
     // Validate that we have files to process
     if expanded_input_files.is_empty() {
         eprintln!("Error: No input files found for sort-only mode. Please specify either input files or path patterns.");
@@ -256,6 +296,12 @@ fn main() -> Result<(), Box<dyn Error>> {
                 args.sort_only = sort_only;
             }
         }
+
+        if args.exclude_patterns.is_empty() {
+            if let Some(exclude_patterns) = config.exclude_patterns {
+                args.exclude_patterns = exclude_patterns;
+            }
+        }
     }
 
     // Initialize logger with appropriate level