diff --git a/includes/derivatives.inc b/includes/derivatives.inc
index ccd8c0d3..9b44b9af 100644
--- a/includes/derivatives.inc
+++ b/includes/derivatives.inc
@@ -62,6 +62,9 @@ function islandora_run_derivatives(AbstractObject $object, $dsid) {
  *     from or NULL if it's the object itself.
  *   - destination_dsid: (Optional) String of the datastream id that is being
  *     created. To be used in the UI.
+ *   - ds_modified_params: (Optional, typically internally used) The array of
+ *     parameters originally sent to FedoraDatastream::modifyDatastream(). Used
+ *     to refine the derivative list; typically should't be passed in manually.
  *
  * @return array
  *   An array of messages describing the outcome of the derivative events.
@@ -287,6 +290,7 @@ function islandora_remove_defer_derivatives_flag(AbstractObject $object) {
 function islandora_get_derivative_list(AbstractObject $object, &$options) {
   module_load_include('inc', 'islandora', 'includes/utilities');
 
+  $ds_modified_params = isset($options['ds_modified_params']) ? $options['ds_modified_params'] : array();
   $options += array(
     'force' => FALSE,
   );
@@ -294,11 +298,12 @@ function islandora_get_derivative_list(AbstractObject $object, &$options) {
   $derivatives = islandora_invoke_hook_list(
     ISLANDORA_DERIVATIVE_CREATION_HOOK,
     $object->models,
-    array($object)
+    array($object),
+    $ds_modified_params
   );
 
   foreach (islandora_build_hook_list(ISLANDORA_DERIVATIVE_CREATION_HOOK, $object->models) as $hook) {
-    drupal_alter($hook, $derivatives, $object);
+    drupal_alter($hook, $derivatives, $object, $ds_modified_params);
   }
 
   uasort($derivatives, 'drupal_sort_weight');
diff --git a/includes/tuque_wrapper.inc b/includes/tuque_wrapper.inc
index 6a38ad4a..7d1d348d 100644
--- a/includes/tuque_wrapper.inc
+++ b/includes/tuque_wrapper.inc
@@ -594,7 +594,7 @@ class IslandoraFedoraDatastream extends FedoraDatastream {
   protected function modifyDatastream(array $args) {
     try {
       parent::modifyDatastream($args);
-      islandora_invoke_datastream_hooks(ISLANDORA_DATASTREAM_MODIFIED_HOOK, $this->parent->models, $this->id, $this->parent, $this);
+      islandora_invoke_datastream_hooks(ISLANDORA_DATASTREAM_MODIFIED_HOOK, $this->parent->models, $this->id, $this->parent, $this, $args);
       if ($this->state == 'D') {
         islandora_invoke_datastream_hooks(ISLANDORA_DATASTREAM_PURGED_HOOK, $this->parent->models, $this->id, $this->parent, $this->id);
       }
diff --git a/islandora.api.php b/islandora.api.php
index 1d0d9872..a50a0c24 100644
--- a/islandora.api.php
+++ b/islandora.api.php
@@ -334,13 +334,18 @@ function hook_cmodel_pid_dsid_islandora_datastream_ingested(AbstractObject $obje
  * @param AbstractObject $object
  *   The object the datastream belongs to.
  * @param AbstractDatastream $datastream
- *   The datastream that was ingested.
- *
- * @todo We should also include what changes were made in a additional
- *   parameter.
- */
-function hook_islandora_datastream_modified(AbstractObject $object, AbstractDatastream $datastream) {
-
+ *   The datastream that was modified.
+ * @param array $params
+ *   The parameters from FedoraDatastream::modifyDatastream() used to modify the
+ *   datastream.
+ */
+function hook_islandora_datastream_modified(AbstractObject $object, AbstractDatastream $datastream, array $params) {
+  // Sample of sanitizing a label.
+  $datastream->label = trim($datastream->label);
+  // Sample of using modifyDatastream parameters.
+  if (isset($params['mimetype'])) {
+    $datastream->label .= " ({$params['mimetype']})";
+  }
 }
 
 /**
@@ -348,7 +353,7 @@ function hook_islandora_datastream_modified(AbstractObject $object, AbstractData
  *
  * @see hook_islandora_datastream_modified()
  */
-function hook_cmodel_pid_islandora_datastream_modified(AbstractObject $object, AbstractDatastream $datastream) {
+function hook_cmodel_pid_islandora_datastream_modified(AbstractObject $object, AbstractDatastream $datastream, array $params) {
 
 }
 
@@ -660,6 +665,11 @@ function hook_cmodel_pid_islandora_overview_object_alter(AbstractObject &$object
  *
  * @param AbstractObject $object
  *   Optional object to which derivatives will be added
+ * @param array $ds_modified_params
+ *   An array that will contain the properties changed on the datastream if
+ *   derivatives were triggered from a datastream_modified hook, as well as a
+ *   'dsid' key naming the datastream that was modified. Can be populated
+ *   manually, but likely empty otherwise.
  *
  * @return array
  *   An array containing an entry for each derivative to be created. Each entry
@@ -693,7 +703,7 @@ function hook_cmodel_pid_islandora_overview_object_alter(AbstractObject &$object
  *   - file: A string denoting the path to the file where the function
  *     is being called from.
  */
-function hook_islandora_derivative(AbstractObject $object = NULL) {
+function hook_islandora_derivative(AbstractObject $object = NULL, $ds_modified_params = array()) {
   $derivatives[] = array(
     'source_dsid' => 'OBJ',
     'destination_dsid' => 'DERIV',
@@ -736,12 +746,23 @@ function hook_cmodel_pid_islandora_derivative() {
 /**
  * Allows for the altering of defined derivative functions.
  */
-function hook_islandora_derivative_alter(&$derivatives, AbstractObject $object) {
+function hook_islandora_derivative_alter(&$derivatives, AbstractObject $object, $ds_modified_params = array()) {
   foreach ($derivatives as $key => $derivative) {
     if ($derivative['destination_dsid'] == 'TN') {
       unset($derivatives[$key]);
     }
   }
+  // Example of altering out derivative generation if only a specified set of
+  // datastream parameters have been modified.
+  $mask = array(
+    'label' => NULL,
+    'dateLastModified' => NULL,
+    'dsid' => NULL,
+  );
+  $param_diff = array_diff_key($ds_modified_params, $mask);
+  if (empty($param_diff)) {
+    $derivatives = array();
+  }
 }
 
 /**
diff --git a/islandora.module b/islandora.module
index b3c4263c..b3f20e21 100644
--- a/islandora.module
+++ b/islandora.module
@@ -1798,11 +1798,15 @@ function islandora_islandora_datastream_ingested(AbstractObject $object, Abstrac
  * equal to the current ingested datastream's id. Force is set to TRUE such that
  * existing derivatives will be updated to reflect the change in the source.
  */
-function islandora_islandora_datastream_modified(AbstractObject $object, AbstractDatastream $datastream) {
+function islandora_islandora_datastream_modified(AbstractObject $object, AbstractDatastream $datastream, $params) {
   module_load_include('inc', 'islandora', 'includes/derivatives');
+  $params += array(
+    'dsid' => $datastream->id,
+  );
   $logging_results = islandora_do_derivatives($object, array(
     'source_dsid' => $datastream->id,
     'force' => TRUE,
+    'ds_modified_params' => $params,
   ));
   islandora_derivative_logging($logging_results);
   islandora_conditionally_clear_cache();
diff --git a/tests/derivatives.test b/tests/derivatives.test
index b7eeae9b..95377a75 100644
--- a/tests/derivatives.test
+++ b/tests/derivatives.test
@@ -248,6 +248,22 @@ class IslandoraDerivativesTestCase extends IslandoraWebTestCase {
     $this->assertEqual(3, count($_islandora_derivative_test_derivative_functions), 'Expected 3 derivative functions when there is no source_dsid, got ' . count($_islandora_derivative_test_derivative_functions) . '.');
   }
 
+  /**
+   * Tests that a derivative can be conditional on the source_dsid modification.
+   */
+  public function testConditionalDerivative() {
+    $object = $this->constructBaseObject();
+    // Derivatives should fire.
+    $ds = $object->constructDatastream('SOMEOTHERDATASTREAM');
+    $ds->label = 'Some Label';
+    $ds->mimetype = 'some/mime';
+    $object->ingestDatastream($ds);
+    $this->assertEqual(1, count($object['SOMEWEIRDDERIV']), 'Expected one version of SOMEWEIDDERIV when unconditionally creating derivatives, got ' . count($object['SOMEWEIRDDERIV']));
+    // Derivatives should not fire.
+    $object['SOMEOTHERDATASTREAM']->label = 'Changed Label';
+    $this->assertEqual(1, count($object['SOMEWEIRDDERIV']), 'Expected the version count of SOMEWEIRDDERIV to remain the same when only changing the label of its source, got ' . count($object['SOMEWEIRDDERIV']));
+  }
+
   /**
    * Helper function that will construct a base object.
    */
diff --git a/tests/hooks.test b/tests/hooks.test
index b8846c52..073d0349 100644
--- a/tests/hooks.test
+++ b/tests/hooks.test
@@ -214,6 +214,18 @@ class IslandoraHooksTestCase extends IslandoraWebTestCase {
     }
     $this->repository->purgeObject($object->id);
 
+    // Test modifying a datastream conditionally on the modification parameters.
+    $object = $this->repository->constructObject('test:testModifiedDatastreamHook');
+    $this->repository->ingestObject($object);
+    $ds = $object->constructDatastream('TEST');
+    $object->ingestDatastream($ds);
+    $_SESSION['islandora_hooks']['hook'][ISLANDORA_DATASTREAM_MODIFIED_HOOK] = FALSE;
+    $_SESSION['islandora_hooks']['iteration'][ISLANDORA_DATASTREAM_MODIFIED_HOOK] = 0;
+    $_SESSION['islandora_hooks']['alter'][ISLANDORA_DATASTREAM_MODIFIED_HOOK] = FALSE;
+    $object->label = "New Label!";
+    $ds->mimetype = "mr/mime";
+    $this->assertEqual('New Label! (Mr. Mime)', $object->label, 'Modified object conditionally on datastream modification.');
+
     // Test purging with FedoraRepository::purgeObject().
     $object = $this->repository->constructObject('test:testPurgedDatastreamHook');
     $this->repository->ingestObject($object);
diff --git a/tests/islandora_derivatives_test.module b/tests/islandora_derivatives_test.module
index 2e27c5c7..4a46eb66 100644
--- a/tests/islandora_derivatives_test.module
+++ b/tests/islandora_derivatives_test.module
@@ -34,9 +34,36 @@ function islandora_derivatives_test_some_cmodel_islandora_derivative() {
         'islandora_derivatives_test_create_nosource_datastream',
       ),
     ),
+    array(
+      'source_dsid' => 'SOMEOTHERDATASTREAM',
+      'destination_dsid' => 'SOMEWEIRDDERIV',
+      'weight' => '0',
+      'function' => array(
+        'islandora_derivatives_test_derive_other_datastream',
+      ),
+    ),
   );
 }
 
+/**
+ * Implements hook_islandora_CMODEL_PID_derivative_alter().
+ */
+function islandora_derivatives_test_some_cmodel_islandora_derivative_alter(&$derivatives, AbstractObject $object, $ds_modified_params) {
+  // Use a mask to determine if only the label has been modified.
+  $diff = array_diff_key($ds_modified_params, array(
+    'label' => NULL,
+    'dateLastModified' => NULL,
+  ));
+  // If that's the case, don't proceed.
+  if (empty($diff)) {
+    foreach ($derivatives as $key => $derivative) {
+      if ($derivative['source_dsid'] == 'SOMEOTHERDATASTREAM') {
+        unset($derivatives[$key]);
+      }
+    }
+  }
+}
+
 /**
  * Creates the DERIV datastream for use in testing.
  *
@@ -140,6 +167,22 @@ function islandora_derivatives_test_create_nosource_datastream(AbstractObject $o
   }
 }
 
+/**
+ * Derives the SOMEWEIRDDERIV datastream.
+ *
+ * @param AbstractObject $object
+ *   An AbstractObject representing a Fedora object.
+ * @param bool $force
+ *   Whether or not derivative generation is to be forced.
+ */
+function islandora_derivatives_test_derive_other_datastream(AbstractObject $object, $force = FALSE) {
+  global $_islandora_derivative_test_derivative_functions;
+  $_islandora_derivative_test_derivative_functions[] = 'islandora_derivatives_test_derive_other_datastream';
+  if (!isset($object['SOMEWEIRDDERIV']) || isset($object['SOMEWEIRDDERIV']) && $force === TRUE) {
+    islandora_derivatives_test_add_datastream($object, 'SOMEWEIRDDERIV', 'wat');
+  }
+}
+
 /**
  * Helper function that adds/modifies the datastream to the object in testing.
  *
diff --git a/tests/islandora_hooks_test.module b/tests/islandora_hooks_test.module
index cceb4dbc..d602cbfd 100644
--- a/tests/islandora_hooks_test.module
+++ b/tests/islandora_hooks_test.module
@@ -140,13 +140,17 @@ function islandora_hooks_test_islandora_datastream_ingested(AbstractObject $obje
 /**
  * Implements hook_islandora_datastream_modified().
  */
-function islandora_hooks_test_islandora_datastream_modified(AbstractObject $object, AbstractDatastream $datastream) {
+function islandora_hooks_test_islandora_datastream_modified(AbstractObject $object, AbstractDatastream $datastream, array $params) {
   if ($object->id == 'test:testModifiedDatastreamHook' && $datastream->id == "TEST") {
     $_SESSION['islandora_hooks']['hook'][ISLANDORA_DATASTREAM_MODIFIED_HOOK] = TRUE;
     if ($_SESSION['islandora_hooks']['iteration'][ISLANDORA_DATASTREAM_MODIFIED_HOOK]++ < 3) {
       $new_label = 'New Label! + ' . $_SESSION['islandora_hooks']['iteration'][ISLANDORA_DATASTREAM_MODIFIED_HOOK];
       $datastream->label = $new_label;
     }
+    if (isset($params['mimeType']) && $params['mimeType'] == 'mr/mime') {
+      $new_label = 'New Label! (Mr. Mime)';
+      $object->label = $new_label;
+    }
   }
 }