diff --git a/.github/workflows/step_tests-conda.yml b/.github/workflows/step_tests-conda.yml
index 00fb18261..f52afb0f6 100644
--- a/.github/workflows/step_tests-conda.yml
+++ b/.github/workflows/step_tests-conda.yml
@@ -51,16 +51,22 @@ jobs:
       - name: Install a Jupyter Kernel
         run: python -m ipykernel install --name jupytext-ci --user
 
+      - name: Test with pytest
+        run: pytest -n logical --cov --cov-report=xml
+
       - name: Test lab extension
         run: |
+          # Uninstall jupyter-fs as it overrides the original browser-test.js to
+          # check its own functionality (https://github.com/jpmorganchase/jupyter-fs/blob/main/jupyterfs/browser-test.js)
+          # So uninstall jupyter-fs before running browser check
+          #
+          pip uninstall jupyter-fs -y
+
           # Check extension
           jupyter labextension list
           jupyter labextension list 2>&1 | grep -ie "jupyterlab-jupytext.*OK"
           python -m jupyterlab.browser_check
 
-      - name: Test with pytest
-        run: pytest -n logical --cov --cov-report=xml
-
       - name: Upload coverage
         uses: codecov/codecov-action@v3
         with:
diff --git a/.github/workflows/step_tests-pip.yml b/.github/workflows/step_tests-pip.yml
index f4a0625c1..f3d5ccd9d 100644
--- a/.github/workflows/step_tests-pip.yml
+++ b/.github/workflows/step_tests-pip.yml
@@ -82,17 +82,23 @@ jobs:
           # install it
           sudo apt install ./*.deb
 
+      - name: Test with pytest
+        continue-on-error: ${{ matrix.experimental }}
+        run: pytest -n logical --cov --cov-report=xml
+
       - name: Test lab extension
         run: |
+          # Uninstall jupyter-fs as it overrides the original browser-test.js to
+          # check its own functionality (https://github.com/jpmorganchase/jupyter-fs/blob/main/jupyterfs/browser-test.js)
+          # So uninstall jupyter-fs before running browser check
+          #
+          pip uninstall jupyter-fs -y
+
           # Check extension
           jupyter labextension list
           jupyter labextension list 2>&1 | grep -ie "jupyterlab-jupytext.*OK"
           python -m jupyterlab.browser_check
 
-      - name: Test with pytest
-        continue-on-error: ${{ matrix.experimental }}
-        run: pytest -n logical --cov --cov-report=xml
-
       - name: Upload coverage
         uses: codecov/codecov-action@v3
         with:
diff --git a/CHANGELOG.md b/CHANGELOG.md
index 39dec8dfe..d17a87d45 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -6,6 +6,8 @@ Jupytext ChangeLog
 
 **Fixed**
 - We have fixed a typo when `build_jupytext_contents_manager_class` can't be imported ([#1162](https://github.com/mwouts/jupytext/issues/1162))
+- We use `inspect` to determine whether the current contents manager derives from `AsyncContentsManager` (which is not
+supported by Jupytext at the moment). This fixes a compatibility issue with `jupyter-fs==1.0.0` ([#1239](https://github.com/mwouts/jupytext/issues/1239)). Thanks to [Mahendra Paipuri](https://github.com/mahendrapaipuri) for this PR!
 - Some dependencies of the JupyterLab extensions were updated ([#1243](https://github.com/mwouts/jupytext/issues/1243), [#1245](https://github.com/mwouts/jupytext/issues/1245))
 
 **Added**
diff --git a/docs/install.md b/docs/install.md
index 761bd08e9..c2ee5fd2e 100644
--- a/docs/install.md
+++ b/docs/install.md
@@ -32,6 +32,17 @@ If you don't have the notebook icon on text documents after a fresh restart of y
 jupyter serverextension enable jupytext
 ```
 
+When [`jupyter-fs>=1.0.0`](https://github.com/jpmorganchase/jupyter-fs) is being used along with `jupytext`, use `SyncMetaManager` as the contents manager for `jupyter-fs` as `jupytext` do not support async contents manager which is used in default `MetaManager` of `jupyter-fs`. The `jupyter-fs` config must be as follows:
+
+```json
+{
+  "ServerApp": {
+    "contents_manager_class": "jupyterfs.metamanager.SyncMetaManager",
+  }
+}
+```
+so that `jupytext` will create its own contents manager derived from `SyncMetaManager`.
+
 ## Jupytext commands in JupyterLab
 
 Jupytext comes with a frontend extension for JupyterLab which provides pairing commands (accessible with View / Activate Command Palette, or Ctrl+Shift+C):
diff --git a/jupyterlab/jupyterlab_jupytext/__init__.py b/jupyterlab/jupyterlab_jupytext/__init__.py
index 2e2b40551..7b0ae4cf2 100644
--- a/jupyterlab/jupyterlab_jupytext/__init__.py
+++ b/jupyterlab/jupyterlab_jupytext/__init__.py
@@ -1,5 +1,9 @@
 """Jupyter server and lab extension entry points"""
 
+import inspect
+
+import jupyter_server
+
 from jupytext.reraise import reraise
 
 try:
@@ -20,22 +24,28 @@ def load_jupyter_server_extension(app):  # pragma: no cover
     # The server extension call is too late!
     # The contents manager was set at NotebookApp.init_configurables
 
-    # Let's change the contents manager class
+    # Get a list of all base classes and check if they contain AsyncContentsManager
     base_class = app.contents_manager_class
-    if "async" in base_class.__name__.lower():
-        app.log.warning(
-            "[Jupytext Server Extension] Async contents managers like {} "
-            "are not supported at the moment "
-            "(https://github.com/mwouts/jupytext/issues/1020). "
-            "We will derive a contents manager from LargeFileManager instead.".format(
-                base_class.__name__
+    parent_classes = inspect.getmro(base_class)
+    for parent_class in parent_classes:
+        if (
+            parent_class
+            == jupyter_server.services.contents.manager.AsyncContentsManager
+        ):
+            app.log.warning(
+                "[Jupytext Server Extension] Async contents managers like {} "
+                "are not supported at the moment "
+                "(https://github.com/mwouts/jupytext/issues/1020). "
+                "We will derive a contents manager from LargeFileManager instead.".format(
+                    parent_class.__name__
+                )
+            )
+            from jupyter_server.services.contents.largefilemanager import (  # noqa
+                LargeFileManager,
             )
-        )
-        from jupyter_server.services.contents.largefilemanager import (  # noqa
-            LargeFileManager,
-        )
 
-        base_class = LargeFileManager
+            base_class = LargeFileManager
+            break
 
     app.log.info(
         "[Jupytext Server Extension] Deriving a JupytextContentsManager "
diff --git a/pyproject.toml b/pyproject.toml
index fa624cff4..4d65500fb 100644
--- a/pyproject.toml
+++ b/pyproject.toml
@@ -75,8 +75,7 @@ test-external = [
   "gitpython",
   "pre-commit",
   # Interaction with other contents managers
-  # jupyter-fs==0.4.0 is async, which is not supported by Jupytext ATM
-  "jupyter-fs<0.4.0"
+  "jupyter-fs>=1.0"
 ]
 # Coverage requirements
 test-cov = [
diff --git a/tests/external/jupyter_fs/test_jupyter_fs.py b/tests/external/jupyter_fs/test_jupyter_fs.py
index 0b703e542..789f8e720 100644
--- a/tests/external/jupyter_fs/test_jupyter_fs.py
+++ b/tests/external/jupyter_fs/test_jupyter_fs.py
@@ -9,11 +9,11 @@
 
 def fs_meta_manager(tmpdir):
     try:
-        from jupyterfs.metamanager import MetaManager
+        from jupyterfs.metamanager import SyncMetaManager
     except ImportError:
         pytest.skip("jupyterfs is not available")
 
-    cm_class = jupytext.build_jupytext_contents_manager_class(MetaManager)
+    cm_class = jupytext.build_jupytext_contents_manager_class(SyncMetaManager)
     logger = logging.getLogger("jupyter-fs")
     cm = cm_class(parent=None, log=logger)
     cm.initResource(