diff --git a/packages/backend-core/src/features/index.ts b/packages/backend-core/src/features/index.ts
index 9c20c97826..e0bd29b1bc 100644
--- a/packages/backend-core/src/features/index.ts
+++ b/packages/backend-core/src/features/index.ts
@@ -160,7 +160,7 @@ export class FlagSet<V extends Flag<any>, T extends { [key: string]: V }> {
           }
 
           // ignore unknown flags
-          if (this.isFlagName(feature)) {
+          if (!this.isFlagName(feature)) {
             continue
           }
 
@@ -170,7 +170,7 @@ export class FlagSet<V extends Flag<any>, T extends { [key: string]: V }> {
 
           // @ts-expect-error - TS does not like you writing into a generic type,
           // but we know that it's okay in this case because it's just an object.
-          flagValues[feature] = value
+          flagValues[feature as keyof FlagValues] = value
           tags[`flags.${feature}.source`] = "environment"
         }
       }
diff --git a/packages/backend-core/src/features/tests/features.spec.ts b/packages/backend-core/src/features/tests/features.spec.ts
index 553558ab14..5cd012f7a5 100644
--- a/packages/backend-core/src/features/tests/features.spec.ts
+++ b/packages/backend-core/src/features/tests/features.spec.ts
@@ -67,9 +67,9 @@ describe("feature flags", () => {
       expected: flags.defaults(),
     },
     {
-      it: "should fail when an environment flag is not recognised",
+      it: "should ignore unknown feature flags",
       environmentFlags: "default:TEST_BOOLEAN,default:FOO",
-      errorMessage: "Feature: FOO is not an allowed option",
+      expected: { TEST_BOOLEAN: true },
     },
     {
       it: "should be able to read boolean flags from PostHog",