diff --git a/CHANGELOG b/CHANGELOG
index 4bb7b29948a..4d3a87f556f 100644
--- a/CHANGELOG
+++ b/CHANGELOG
@@ -17,6 +17,8 @@ v 7.9.0 (unreleased)
   - Improve error messages for file edit failures
   - Improve UI for commits, issues and merge request lists
   - Fix commit comments on first line of diff not rendering in Merge Request Discussion view.
+  - Allow admins to override restricted project visibility settings.
+  - Move restricted visibility settings from gitlab.yml into the web UI.
   - Improve trigger merge request hook when source project branch has been updated (Kirill Zaitsev)
   - Save web edit in new branch
   - Fix ordering of imported but unchanged projects (Marco Wessel)
diff --git a/app/assets/stylesheets/generic/forms.scss b/app/assets/stylesheets/generic/forms.scss
index 19bc11086e9..5aa6f4cb66b 100644
--- a/app/assets/stylesheets/generic/forms.scss
+++ b/app/assets/stylesheets/generic/forms.scss
@@ -97,3 +97,8 @@ label {
 .wiki-content {
   margin-top: 35px;
 }
+
+.btn-group .btn.active {
+  text-shadow: 0 0 0.2em #D9534F, 0 0 0.2em #D9534F, 0 0 0.2em #D9534F;
+  background-color: #5487bf;
+}
diff --git a/app/controllers/admin/application_settings_controller.rb b/app/controllers/admin/application_settings_controller.rb
index 2b0c500e97a..8f7d5e8006f 100644
--- a/app/controllers/admin/application_settings_controller.rb
+++ b/app/controllers/admin/application_settings_controller.rb
@@ -20,6 +20,13 @@ class Admin::ApplicationSettingsController < Admin::ApplicationController
   end
 
   def application_setting_params
+    restricted_levels = params[:application_setting][:restricted_visibility_levels]
+    unless restricted_levels.nil?
+      restricted_levels.map! do |level|
+        level.to_i
+      end
+    end
+
     params.require(:application_setting).permit(
       :default_projects_limit,
       :default_branch_protection,
@@ -28,7 +35,8 @@ class Admin::ApplicationSettingsController < Admin::ApplicationController
       :gravatar_enabled,
       :twitter_sharing_enabled,
       :sign_in_text,
-      :home_page_url
+      :home_page_url,
+      restricted_visibility_levels: []
     )
   end
 end
diff --git a/app/controllers/projects/snippets_controller.rb b/app/controllers/projects/snippets_controller.rb
index 6c250e4ffed..ed268400373 100644
--- a/app/controllers/projects/snippets_controller.rb
+++ b/app/controllers/projects/snippets_controller.rb
@@ -28,26 +28,22 @@ class Projects::SnippetsController < Projects::ApplicationController
   end
 
   def create
-    @snippet = @project.snippets.build(snippet_params)
-    @snippet.author = current_user
-
-    if @snippet.save
-      redirect_to namespace_project_snippet_path(@project.namespace, @project,
-                                                 @snippet)
-    else
-      respond_with(@snippet)
-    end
+    @snippet = CreateSnippetService.new(@project, current_user,
+                                        snippet_params).execute
+    respond_with(@snippet,
+                 location: namespace_project_snippet_path(@project.namespace,
+                                                          @project, @snippet))
   end
 
   def edit
   end
 
   def update
-    if @snippet.update_attributes(snippet_params)
-      redirect_to namespace_project_snippet_path(@project.namespace, @project, @snippet)
-    else
-      respond_with(@snippet)
-    end
+    UpdateSnippetService.new(project, current_user, @snippet,
+                             snippet_params).execute
+    respond_with(@snippet,
+                 location: namespace_project_snippet_path(@project.namespace,
+                                                          @project, @snippet))
   end
 
   def show
diff --git a/app/controllers/snippets_controller.rb b/app/controllers/snippets_controller.rb
index ae501362dc2..cd52556b203 100644
--- a/app/controllers/snippets_controller.rb
+++ b/app/controllers/snippets_controller.rb
@@ -42,25 +42,19 @@ class SnippetsController < ApplicationController
   end
 
   def create
-    @snippet = PersonalSnippet.new(snippet_params)
-    @snippet.author = current_user
+    @snippet = CreateSnippetService.new(nil, current_user,
+                                        snippet_params).execute
 
-    if @snippet.save
-      redirect_to snippet_path(@snippet)
-    else
-      respond_with @snippet
-    end
+    respond_with @snippet.becomes(Snippet)
   end
 
   def edit
   end
 
   def update
-    if @snippet.update_attributes(snippet_params)
-      redirect_to snippet_path(@snippet)
-    else
-      respond_with @snippet
-    end
+    UpdateSnippetService.new(nil, current_user, @snippet,
+                             snippet_params).execute
+    respond_with @snippet.becomes(Snippet)
   end
 
   def show
diff --git a/app/helpers/application_settings_helper.rb b/app/helpers/application_settings_helper.rb
index 1ee086da997..241d6075c9f 100644
--- a/app/helpers/application_settings_helper.rb
+++ b/app/helpers/application_settings_helper.rb
@@ -18,4 +18,21 @@ module ApplicationSettingsHelper
   def extra_sign_in_text
     current_application_settings.sign_in_text
   end
+
+  # Return a group of checkboxes that use Bootstrap's button plugin for a
+  # toggle button effect.
+  def restricted_level_checkboxes(help_block_id)
+    Gitlab::VisibilityLevel.options.map do |name, level|
+      checked = restricted_visibility_levels(true).include?(level)
+      css_class = 'btn btn-primary'
+      css_class += ' active' if checked
+      checkbox_name = 'application_setting[restricted_visibility_levels][]'
+
+      label_tag(checkbox_name, class: css_class) do
+        check_box_tag(checkbox_name, level, checked,
+                      autocomplete: 'off',
+                      'aria-describedby' => help_block_id) + name
+      end
+    end
+  end
 end
diff --git a/app/helpers/gitlab_routing_helper.rb b/app/helpers/gitlab_routing_helper.rb
index 8518a47a3a0..b005cb8e417 100644
--- a/app/helpers/gitlab_routing_helper.rb
+++ b/app/helpers/gitlab_routing_helper.rb
@@ -45,7 +45,8 @@ module GitlabRoutingHelper
     namespace_project_merge_request_url(entity.project.namespace, entity.project, entity, *args)
   end
 
-  def snippet_url(entity, *args)
+  def project_snippet_url(entity, *args)
     namespace_project_snippet_url(entity.project.namespace, entity.project, entity, *args)
+
   end
 end
diff --git a/app/helpers/visibility_level_helper.rb b/app/helpers/visibility_level_helper.rb
index deb9c8b4d49..7c090dc594c 100644
--- a/app/helpers/visibility_level_helper.rb
+++ b/app/helpers/visibility_level_helper.rb
@@ -60,7 +60,8 @@ module VisibilityLevelHelper
     Project.visibility_levels.key(level)
   end
 
-  def restricted_visibility_levels
-    current_user.is_admin? ? [] : gitlab_config.restricted_visibility_levels
+  def restricted_visibility_levels(show_all = false)
+    return [] if current_user.is_admin? && !show_all
+    current_application_settings.restricted_visibility_levels
   end
 end
diff --git a/app/models/ability.rb b/app/models/ability.rb
index 855134dd39b..d2b39f667f2 100644
--- a/app/models/ability.rb
+++ b/app/models/ability.rb
@@ -225,13 +225,15 @@ class Ability
 
     [:issue, :note, :project_snippet, :personal_snippet, :merge_request].each do |name|
       define_method "#{name}_abilities" do |user, subject|
-        if subject.author == user
-          [
+        if subject.author == user || user.is_admin?
+          rules = [
             :"read_#{name}",
             :"write_#{name}",
             :"modify_#{name}",
             :"admin_#{name}"
           ]
+          rules.push(:change_visibility_level) if subject.is_a?(Snippet)
+          rules
         elsif subject.respond_to?(:assignee) && subject.assignee == user
           [
             :"read_#{name}",
diff --git a/app/models/application_setting.rb b/app/models/application_setting.rb
index 588668b3d1e..6abdf0c755a 100644
--- a/app/models/application_setting.rb
+++ b/app/models/application_setting.rb
@@ -2,25 +2,38 @@
 #
 # Table name: application_settings
 #
-#  id                        :integer          not null, primary key
-#  default_projects_limit    :integer
-#  signup_enabled            :boolean
-#  signin_enabled            :boolean
-#  gravatar_enabled          :boolean
-#  sign_in_text              :text
-#  created_at                :datetime
-#  updated_at                :datetime
-#  home_page_url             :string(255)
-#  default_branch_protection :integer          default(2)
-#  twitter_sharing_enabled   :boolean          default(TRUE)
+#  id                           :integer        not null, primary key
+#  default_projects_limit       :integer
+#  default_branch_protection    :integer
+#  signup_enabled               :boolean
+#  signin_enabled               :boolean
+#  gravatar_enabled             :boolean
+#  twitter_sharing_enabled      :boolean
+#  sign_in_text                 :text
+#  created_at                   :datetime
+#  updated_at                   :datetime
+#  home_page_url                :string(255)
+#  default_branch_protection    :integer          default(2)
+#  twitter_sharing_enabled      :boolean          default(TRUE)
+#  restricted_visibility_levels :text
 #
 
 class ApplicationSetting < ActiveRecord::Base
+  serialize :restricted_visibility_levels
+
   validates :home_page_url,
     allow_blank: true,
     format: { with: URI::regexp(%w(http https)), message: "should be a valid url" },
     if: :home_page_url_column_exist
 
+  validates_each :restricted_visibility_levels do |record, attr, value|
+    value.each do |level|
+      unless Gitlab::VisibilityLevel.options.has_value?(level)
+        record.errors.add(attr, "'#{level}' is not a valid visibility level")
+      end
+    end
+  end
+
   def self.current
     ApplicationSetting.last
   end
@@ -34,6 +47,7 @@ class ApplicationSetting < ActiveRecord::Base
       twitter_sharing_enabled: Settings.gitlab['twitter_sharing_enabled'],
       gravatar_enabled: Settings.gravatar['enabled'],
       sign_in_text: Settings.extra['sign_in_text'],
+      restricted_visibility_levels: Settings.gitlab['restricted_visibility_levels']
     )
   end
 
diff --git a/app/models/project.rb b/app/models/project.rb
index 1d1ae569fc2..b19606e9635 100644
--- a/app/models/project.rb
+++ b/app/models/project.rb
@@ -131,9 +131,6 @@ class Project < ActiveRecord::Base
               message: Gitlab::Regex.path_regex_message }
   validates :issues_enabled, :merge_requests_enabled,
             :wiki_enabled, inclusion: { in: [true, false] }
-  validates :visibility_level,
-    exclusion: { in: gitlab_config.restricted_visibility_levels },
-    if: -> { gitlab_config.restricted_visibility_levels.any? }
   validates :issues_tracker_id, length: { maximum: 255 }, allow_blank: true
   validates :namespace, presence: true
   validates_uniqueness_of :name, scope: :namespace_id
diff --git a/app/services/base_service.rb b/app/services/base_service.rb
index 52ab29f1492..6d9ed345914 100644
--- a/app/services/base_service.rb
+++ b/app/services/base_service.rb
@@ -31,8 +31,19 @@ class BaseService
     SystemHooksService.new
   end
 
-  def current_application_settings
-    ApplicationSetting.current
+  # Add an error to the specified model for restricted visibility levels
+  def deny_visibility_level(model, denied_visibility_level = nil)
+    denied_visibility_level ||= model.visibility_level
+
+    level_name = 'Unknown'
+    Gitlab::VisibilityLevel.options.each do |name, level|
+      level_name = name if level == denied_visibility_level
+    end
+
+    model.errors.add(
+      :visibility_level,
+      "#{level_name} visibility has been restricted by your GitLab administrator"
+    )
   end
 
   private
diff --git a/app/services/create_snippet_service.rb b/app/services/create_snippet_service.rb
new file mode 100644
index 00000000000..101a3df5eee
--- /dev/null
+++ b/app/services/create_snippet_service.rb
@@ -0,0 +1,20 @@
+class CreateSnippetService < BaseService
+  def execute
+    if project.nil?
+      snippet = PersonalSnippet.new(params)
+    else
+      snippet = project.snippets.build(params)
+    end
+
+    unless Gitlab::VisibilityLevel.allowed_for?(current_user,
+                                                params[:visibility_level])
+      deny_visibility_level(snippet)
+      return snippet
+    end
+
+    snippet.author = current_user
+
+    snippet.save
+    snippet
+  end
+end
diff --git a/app/services/projects/create_service.rb b/app/services/projects/create_service.rb
index 4fe790b98f1..7ffd0b3882a 100644
--- a/app/services/projects/create_service.rb
+++ b/app/services/projects/create_service.rb
@@ -7,9 +7,12 @@ module Projects
     def execute
       @project = Project.new(params)
 
-      # Reset visibility level if is not allowed to set it
-      unless Gitlab::VisibilityLevel.allowed_for?(current_user, params[:visibility_level])
-        @project.visibility_level = default_features.visibility_level
+      # Make sure that the user is allowed to use the specified visibility
+      # level
+      unless Gitlab::VisibilityLevel.allowed_for?(current_user,
+                                                  params[:visibility_level])
+        deny_visibility_level(@project)
+        return @project
       end
 
       # Set project name from path
diff --git a/app/services/projects/update_service.rb b/app/services/projects/update_service.rb
index 36877a61679..69bdd045ddf 100644
--- a/app/services/projects/update_service.rb
+++ b/app/services/projects/update_service.rb
@@ -2,8 +2,13 @@ module Projects
   class UpdateService < BaseService
     def execute
       # check that user is allowed to set specified visibility_level
-      unless can?(current_user, :change_visibility_level, project) && Gitlab::VisibilityLevel.allowed_for?(current_user, params[:visibility_level])
-        params[:visibility_level] = project.visibility_level
+      new_visibility = params[:visibility_level]
+      if new_visibility && new_visibility.to_i != project.visibility_level
+        unless can?(current_user, :change_visibility_level, project) &&
+          Gitlab::VisibilityLevel.allowed_for?(current_user, new_visibility)
+          deny_visibility_level(project, new_visibility)
+          return project
+        end
       end
 
       new_branch = params[:default_branch]
diff --git a/app/services/update_snippet_service.rb b/app/services/update_snippet_service.rb
new file mode 100644
index 00000000000..9d181c2d2ab
--- /dev/null
+++ b/app/services/update_snippet_service.rb
@@ -0,0 +1,22 @@
+class UpdateSnippetService < BaseService
+  attr_accessor :snippet
+
+  def initialize(project, user, snippet, params)
+    super(project, user, params)
+    @snippet = snippet
+  end
+
+  def execute
+    # check that user is allowed to set specified visibility_level
+    new_visibility = params[:visibility_level]
+    if new_visibility && new_visibility.to_i != snippet.visibility_level
+      unless can?(current_user, :change_visibility_level, snippet) &&
+        Gitlab::VisibilityLevel.allowed_for?(current_user, new_visibility)
+        deny_visibility_level(snippet, new_visibility)
+        return snippet
+      end
+    end
+
+    snippet.update_attributes(params)
+  end
+end
diff --git a/app/views/admin/application_settings/_form.html.haml b/app/views/admin/application_settings/_form.html.haml
index 520f327f4e7..781600a3766 100644
--- a/app/views/admin/application_settings/_form.html.haml
+++ b/app/views/admin/application_settings/_form.html.haml
@@ -42,6 +42,14 @@
       = f.label :default_branch_protection, class: 'control-label col-sm-2'
       .col-sm-10
         = f.select :default_branch_protection, options_for_select(Gitlab::Access.protection_options, @application_setting.default_branch_protection), {}, class: 'form-control'
+    .form-group
+      = f.label :restricted_visibility_levels, class: 'control-label col-sm-2'
+      .col-sm-10
+        - data_attrs = { toggle: 'buttons' }
+        .btn-group{ data: data_attrs }
+          - restricted_level_checkboxes('restricted-visibility-help').each do |level|
+            = level
+        %span.help-block#restricted-visibility-help Selected levels cannot be used by non-admin users for projects or snippets
     .form-group
       = f.label :home_page_url, class: 'control-label col-sm-2'
       .col-sm-10
diff --git a/config/gitlab.yml.example b/config/gitlab.yml.example
index 75d9e65aefe..a85db10e019 100644
--- a/config/gitlab.yml.example
+++ b/config/gitlab.yml.example
@@ -57,10 +57,6 @@ production: &base
     ##   COLOR  = 5
     # default_theme: 2 # default: 2
 
-    # Restrict setting visibility levels for non-admin users.
-    # The default is to allow all levels.
-    # restricted_visibility_levels: [ "public" ]
-
     ## Automatic issue closing
     # If a commit message matches this regular expression, all issues referenced from the matched text will be closed.
     # This happens when the commit is pushed or merged into the default branch of a project.
diff --git a/db/migrate/20150301014758_add_restricted_visibility_levels_to_application_settings.rb b/db/migrate/20150301014758_add_restricted_visibility_levels_to_application_settings.rb
new file mode 100644
index 00000000000..494c3033bff
--- /dev/null
+++ b/db/migrate/20150301014758_add_restricted_visibility_levels_to_application_settings.rb
@@ -0,0 +1,5 @@
+class AddRestrictedVisibilityLevelsToApplicationSettings < ActiveRecord::Migration
+  def change
+    add_column :application_settings, :restricted_visibility_levels, :text
+  end
+end
diff --git a/db/schema.rb b/db/schema.rb
index 3afbc082b70..3dcc43803b9 100644
--- a/db/schema.rb
+++ b/db/schema.rb
@@ -25,8 +25,9 @@ ActiveRecord::Schema.define(version: 20150306023112) do
     t.datetime "created_at"
     t.datetime "updated_at"
     t.string   "home_page_url"
-    t.integer  "default_branch_protection", default: 2
-    t.boolean  "twitter_sharing_enabled",   default: true
+    t.integer  "default_branch_protection",    default: 2
+    t.boolean  "twitter_sharing_enabled",      default: true
+    t.text     "restricted_visibility_levels"
   end
 
   create_table "broadcast_messages", force: true do |t|
diff --git a/doc/public_access/public_access.md b/doc/public_access/public_access.md
index 4712c387021..7c5a6c04639 100644
--- a/doc/public_access/public_access.md
+++ b/doc/public_access/public_access.md
@@ -41,4 +41,4 @@ When visiting the public page of an user, you will only see listed projects whic
 
 ## Restricting the use of public or internal projects
 
-In [gitlab.yml](https://gitlab.com/gitlab-org/gitlab-ce/blob/dbd88d453b8e6c78a423fa7e692004b1db6ea069/config/gitlab.yml.example#L64) you can disable public projects or public and internal projects for the entire GitLab installation to prevent people making code public by accident.
+In [gitlab.yml](https://gitlab.com/gitlab-org/gitlab-ce/blob/dbd88d453b8e6c78a423fa7e692004b1db6ea069/config/gitlab.yml.example#L64) you can disable public projects or public and internal projects for the entire GitLab installation to prevent people making code public by accident.  The restricted visibility settings do not apply to admin users.
diff --git a/lib/api/helpers.rb b/lib/api/helpers.rb
index ee678d84c84..a6e77002a01 100644
--- a/lib/api/helpers.rb
+++ b/lib/api/helpers.rb
@@ -207,7 +207,7 @@ module API
     end
 
     def render_validation_error!(model)
-      unless model.valid?
+      if model.errors.any?
         render_api_error!(model.errors.messages || '400 Bad Request', 400)
       end
     end
diff --git a/lib/api/project_snippets.rb b/lib/api/project_snippets.rb
index 0c2d282f785..54f2555903f 100644
--- a/lib/api/project_snippets.rb
+++ b/lib/api/project_snippets.rb
@@ -42,21 +42,22 @@ module API
       #   title (required) - The title of a snippet
       #   file_name (required) - The name of a snippet file
       #   code (required) - The content of a snippet
+      #   visibility_level (required) - The snippet's visibility
       # Example Request:
       #   POST /projects/:id/snippets
       post ":id/snippets" do
         authorize! :write_project_snippet, user_project
-        required_attributes! [:title, :file_name, :code]
+        required_attributes! [:title, :file_name, :code, :visibility_level]
 
-        attrs = attributes_for_keys [:title, :file_name]
+        attrs = attributes_for_keys [:title, :file_name, :visibility_level]
         attrs[:content] = params[:code] if params[:code].present?
-        @snippet = user_project.snippets.new attrs
-        @snippet.author = current_user
+        @snippet = CreateSnippetService.new(user_project, current_user,
+                                            attrs).execute
 
-        if @snippet.save
-          present @snippet, with: Entities::ProjectSnippet
-        else
+        if @snippet.errors.any?
           render_validation_error!(@snippet)
+        else
+          present @snippet, with: Entities::ProjectSnippet
         end
       end
 
@@ -68,19 +69,22 @@ module API
       #   title (optional) - The title of a snippet
       #   file_name (optional) - The name of a snippet file
       #   code (optional) - The content of a snippet
+      #   visibility_level (optional) - The snippet's visibility
       # Example Request:
       #   PUT /projects/:id/snippets/:snippet_id
       put ":id/snippets/:snippet_id" do
         @snippet = user_project.snippets.find(params[:snippet_id])
         authorize! :modify_project_snippet, @snippet
 
-        attrs = attributes_for_keys [:title, :file_name]
+        attrs = attributes_for_keys [:title, :file_name, :visibility_level]
         attrs[:content] = params[:code] if params[:code].present?
 
-        if @snippet.update_attributes attrs
-          present @snippet, with: Entities::ProjectSnippet
-        else
+        UpdateSnippetService.new(user_project, current_user, @snippet,
+                                 attrs).execute
+        if @snippet.errors.any?
           render_validation_error!(@snippet)
+        else
+          present @snippet, with: Entities::ProjectSnippet
         end
       end
 
diff --git a/lib/api/projects.rb b/lib/api/projects.rb
index 0677e85beab..83f65eec6cc 100644
--- a/lib/api/projects.rb
+++ b/lib/api/projects.rb
@@ -233,10 +233,10 @@ module API
         ::Projects::UpdateService.new(user_project,
                                       current_user, attrs).execute
 
-        if user_project.valid?
-          present user_project, with: Entities::Project
-        else
+        if user_project.errors.any?
           render_validation_error!(user_project)
+        else
+          present user_project, with: Entities::Project
         end
       end
 
diff --git a/lib/gitlab/current_settings.rb b/lib/gitlab/current_settings.rb
index 1a25eebe7d1..0ebebfa09c4 100644
--- a/lib/gitlab/current_settings.rb
+++ b/lib/gitlab/current_settings.rb
@@ -5,8 +5,7 @@ module Gitlab
 
       RequestStore.store[key] ||= begin
         if ActiveRecord::Base.connected? && ActiveRecord::Base.connection.table_exists?('application_settings')
-          RequestStore.store[:current_application_settings] =
-            (ApplicationSetting.current || ApplicationSetting.create_from_defaults)
+          ApplicationSetting.current || ApplicationSetting.create_from_defaults
         else
           fake_application_settings
         end
@@ -21,6 +20,7 @@ module Gitlab
         signin_enabled: Settings.gitlab['signin_enabled'],
         gravatar_enabled: Settings.gravatar['enabled'],
         sign_in_text: Settings.extra['sign_in_text'],
+        restricted_visibility_levels: Settings.gitlab['restricted_visibility_levels']
       )
     end
   end
diff --git a/lib/gitlab/url_builder.rb b/lib/gitlab/url_builder.rb
index 6830d15875a..11b0d44f340 100644
--- a/lib/gitlab/url_builder.rb
+++ b/lib/gitlab/url_builder.rb
@@ -51,9 +51,9 @@ module Gitlab
                           anchor: "note_#{note.id}")
       elsif note.for_project_snippet?
         snippet = Snippet.find(note.noteable_id)
-        snippet_url(snippet,
-                    host: Gitlab.config.gitlab['url'],
-                    anchor: "note_#{note.id}")
+        project_snippet_url(snippet,
+                            host: Gitlab.config.gitlab['url'],
+                            anchor: "note_#{note.id}")
       end
     end
   end
diff --git a/lib/gitlab/visibility_level.rb b/lib/gitlab/visibility_level.rb
index d0b6cde3c7e..1851e76067c 100644
--- a/lib/gitlab/visibility_level.rb
+++ b/lib/gitlab/visibility_level.rb
@@ -5,6 +5,8 @@
 #
 module Gitlab
   module VisibilityLevel
+    extend CurrentSettings
+
     PRIVATE  = 0 unless const_defined?(:PRIVATE)
     INTERNAL = 10 unless const_defined?(:INTERNAL)
     PUBLIC   = 20 unless const_defined?(:PUBLIC)
@@ -23,21 +25,21 @@ module Gitlab
       end
 
       def allowed_for?(user, level)
-        user.is_admin? || allowed_level?(level)
+        user.is_admin? || allowed_level?(level.to_i)
       end
 
-      # Level can be a string `"public"` or a value `20`, first check if valid,
-      # then check if the corresponding string appears in the config
+      # Return true if the specified level is allowed for the current user.
+      # Level should be a numeric value, e.g. `20`.
       def allowed_level?(level)
-        if options.has_key?(level.to_s)
-          non_restricted_level?(level)
-        elsif options.has_value?(level.to_i)
-          non_restricted_level?(options.key(level.to_i).downcase)
-        end
+        valid_level?(level) && non_restricted_level?(level)
       end
 
       def non_restricted_level?(level)
-        ! Gitlab.config.gitlab.restricted_visibility_levels.include?(level)
+        ! current_application_settings.restricted_visibility_levels.include?(level)
+      end
+
+      def valid_level?(level)
+        options.has_value?(level)
       end
     end
 
diff --git a/spec/models/application_setting_spec.rb b/spec/models/application_setting_spec.rb
index d1027f64d13..b4f0b2c201a 100644
--- a/spec/models/application_setting_spec.rb
+++ b/spec/models/application_setting_spec.rb
@@ -2,17 +2,19 @@
 #
 # Table name: application_settings
 #
-#  id                        :integer          not null, primary key
-#  default_projects_limit    :integer
-#  signup_enabled            :boolean
-#  signin_enabled            :boolean
-#  gravatar_enabled          :boolean
-#  sign_in_text              :text
-#  created_at                :datetime
-#  updated_at                :datetime
-#  home_page_url             :string(255)
-#  default_branch_protection :integer          default(2)
-#  twitter_sharing_enabled   :boolean          default(TRUE)
+#  id                           :integer          not null, primary key
+#  default_projects_limit       :integer
+#  default_branch_protection    :integer
+#  signup_enabled               :boolean
+#  signin_enabled               :boolean
+#  gravatar_enabled             :boolean
+#  sign_in_text                 :text
+#  created_at                   :datetime
+#  updated_at                   :datetime
+#  home_page_url                :string(255)
+#  default_branch_protection    :integer          default(2)
+#  twitter_sharing_enabled      :boolean          default(TRUE)
+#  restricted_visibility_levels :text
 #
 
 require 'spec_helper'
diff --git a/spec/requests/api/projects_spec.rb b/spec/requests/api/projects_spec.rb
index 0b3a47e3273..f28dfea3ccf 100644
--- a/spec/requests/api/projects_spec.rb
+++ b/spec/requests/api/projects_spec.rb
@@ -3,6 +3,7 @@ require 'spec_helper'
 
 describe API::API, api: true  do
   include ApiHelpers
+  include Gitlab::CurrentSettings
   let(:user) { create(:user) }
   let(:user2) { create(:user) }
   let(:user3) { create(:user) }
@@ -202,6 +203,31 @@ describe API::API, api: true  do
       expect(json_response['public']).to be_falsey
       expect(json_response['visibility_level']).to eq(Gitlab::VisibilityLevel::PRIVATE)
     end
+
+    context 'when a visibility level is restricted' do
+      before do
+        @project = attributes_for(:project, { public: true })
+        allow_any_instance_of(ApplicationSetting).to(
+          receive(:restricted_visibility_levels).and_return([20])
+        )
+      end
+
+      it 'should not allow a non-admin to use a restricted visibility level' do
+        post api('/projects', user), @project
+        expect(response.status).to eq(400)
+        expect(json_response['message']['visibility_level'].first).to(
+          match('restricted by your GitLab administrator')
+        )
+      end
+
+      it 'should allow an admin to override restricted visibility settings' do
+        post api('/projects', admin), @project
+        expect(json_response['public']).to be_truthy
+        expect(json_response['visibility_level']).to(
+          eq(Gitlab::VisibilityLevel::PUBLIC)
+        )
+      end
+    end
   end
 
   describe 'POST /projects/user/:id' do
@@ -399,7 +425,8 @@ describe API::API, api: true  do
   describe 'POST /projects/:id/snippets' do
     it 'should create a new project snippet' do
       post api("/projects/#{project.id}/snippets", user),
-        title: 'api test', file_name: 'sample.rb', code: 'test'
+        title: 'api test', file_name: 'sample.rb', code: 'test',
+        visibility_level: '0'
       expect(response.status).to eq(201)
       expect(json_response['title']).to eq('api test')
     end
diff --git a/spec/services/create_snippet_service_spec.rb b/spec/services/create_snippet_service_spec.rb
new file mode 100644
index 00000000000..08689c15ca8
--- /dev/null
+++ b/spec/services/create_snippet_service_spec.rb
@@ -0,0 +1,44 @@
+require 'spec_helper'
+
+describe CreateSnippetService do
+  before do
+    @user = create :user
+    @admin = create :user, admin: true
+    @opts = {
+      title: 'Test snippet',
+      file_name: 'snippet.rb',
+      content: 'puts "hello world"',
+      visibility_level: Gitlab::VisibilityLevel::PRIVATE
+    }
+  end
+
+  context 'When public visibility is restricted' do
+    before do
+      allow_any_instance_of(ApplicationSetting).to(
+        receive(:restricted_visibility_levels).and_return(
+          [Gitlab::VisibilityLevel::PUBLIC]
+        )
+      )
+
+      @opts.merge!(visibility_level: Gitlab::VisibilityLevel::PUBLIC)
+    end
+
+    it 'non-admins should not be able to create a public snippet' do
+      snippet = create_snippet(nil, @user, @opts)
+      expect(snippet.errors.messages).to have_key(:visibility_level)
+      expect(snippet.errors.messages[:visibility_level].first).to(
+        match('Public visibility has been restricted')
+      )
+    end
+
+    it 'admins should be able to create a public snippet' do
+      snippet = create_snippet(nil, @admin, @opts)
+      expect(snippet.errors.any?).to be_falsey
+      expect(snippet.visibility_level).to eq(Gitlab::VisibilityLevel::PUBLIC)
+    end
+  end
+
+  def create_snippet(project, user, opts)
+    CreateSnippetService.new(project, user, opts).execute
+  end
+end
diff --git a/spec/services/projects/create_service_spec.rb b/spec/services/projects/create_service_spec.rb
index 8bb48346202..337dae592dd 100644
--- a/spec/services/projects/create_service_spec.rb
+++ b/spec/services/projects/create_service_spec.rb
@@ -55,6 +55,33 @@ describe Projects::CreateService do
         it { expect(File.exists?(@path)).to be_falsey }
       end
     end
+
+    context 'restricted visibility level' do
+      before do
+        allow_any_instance_of(ApplicationSetting).to(
+          receive(:restricted_visibility_levels).and_return([20])
+        )
+
+        @opts.merge!(
+          visibility_level: Gitlab::VisibilityLevel.options['Public']
+        )
+      end
+
+      it 'should not allow a restricted visibility level for non-admins' do
+        project = create_project(@user, @opts)
+        expect(project).to respond_to(:errors)
+        expect(project.errors.messages).to have_key(:visibility_level)
+        expect(project.errors.messages[:visibility_level].first).to(
+          match('restricted by your GitLab administrator')
+        )
+      end
+
+      it 'should allow a restricted visibility level for admins' do
+        project = create_project(@admin, @opts)
+        expect(project.errors.any?).to be(false)
+        expect(project.saved?).to be(true)
+      end
+    end
   end
 
   def create_project(user, opts)
diff --git a/spec/services/projects/update_service_spec.rb b/spec/services/projects/update_service_spec.rb
index 10dbc548e86..ea5b8813105 100644
--- a/spec/services/projects/update_service_spec.rb
+++ b/spec/services/projects/update_service_spec.rb
@@ -47,9 +47,9 @@ describe Projects::UpdateService do
 
     context 'respect configured visibility restrictions setting' do
       before(:each) do
-        @restrictions = double("restrictions")
-        allow(@restrictions).to receive(:restricted_visibility_levels) { [ "public" ] }
-        Settings.stub_chain(:gitlab).and_return(@restrictions)
+        allow_any_instance_of(ApplicationSetting).to(
+          receive(:restricted_visibility_levels).and_return([20])
+        )
       end
 
       context 'should be private when updated to private' do
diff --git a/spec/services/update_snippet_service_spec.rb b/spec/services/update_snippet_service_spec.rb
new file mode 100644
index 00000000000..841ef9bfed1
--- /dev/null
+++ b/spec/services/update_snippet_service_spec.rb
@@ -0,0 +1,52 @@
+require 'spec_helper'
+
+describe UpdateSnippetService do
+  before do
+    @user = create :user
+    @admin = create :user, admin: true
+    @opts = {
+      title: 'Test snippet',
+      file_name: 'snippet.rb',
+      content: 'puts "hello world"',
+      visibility_level: Gitlab::VisibilityLevel::PRIVATE
+    }
+  end
+
+  context 'When public visibility is restricted' do
+    before do
+      allow_any_instance_of(ApplicationSetting).to(
+        receive(:restricted_visibility_levels).and_return(
+          [Gitlab::VisibilityLevel::PUBLIC]
+        )
+      )
+
+      @snippet = create_snippet(@project, @user, @opts)
+      @opts.merge!(visibility_level: Gitlab::VisibilityLevel::PUBLIC)
+    end
+
+    it 'non-admins should not be able to update to public visibility' do
+      old_visibility = @snippet.visibility_level
+      update_snippet(@project, @user, @snippet, @opts)
+      expect(@snippet.errors.messages).to have_key(:visibility_level)
+      expect(@snippet.errors.messages[:visibility_level].first).to(
+        match('Public visibility has been restricted')
+      )
+      expect(@snippet.visibility_level).to eq(old_visibility)
+    end
+
+    it 'admins should be able to update to pubic visibility' do
+      old_visibility = @snippet.visibility_level
+      update_snippet(@project, @admin, @snippet, @opts)
+      expect(@snippet.visibility_level).not_to eq(old_visibility)
+      expect(@snippet.visibility_level).to eq(Gitlab::VisibilityLevel::PUBLIC)
+    end
+  end
+
+  def create_snippet(project, user, opts)
+    CreateSnippetService.new(project, user, opts).execute
+  end
+
+  def update_snippet(project = nil, user, snippet, opts)
+    UpdateSnippetService.new(project, user, snippet, opts).execute
+  end
+end