diff --git a/src/compiler/checker.ts b/src/compiler/checker.ts
index 081ed5b6e67bb..c2d47a3595576 100644
--- a/src/compiler/checker.ts
+++ b/src/compiler/checker.ts
@@ -1262,8 +1262,9 @@ namespace ts {
                             if (meaning & result.flags & SymbolFlags.Variable) {
                                 // expression inside parameter will lookup as normal variable scope when targeting es2015+
                                 const functionLocation = <FunctionLikeDeclaration>location;
-                                if (compilerOptions.target && compilerOptions.target >= ScriptTarget.ES2015 && isParameter(lastLocation) &&
-                                    functionLocation.body && result.valueDeclaration.pos >= functionLocation.body.pos && result.valueDeclaration.end <= functionLocation.body.end) {
+                                if (compilerOptions.target && compilerOptions.target >= ScriptTarget.ES2015 &&
+                                    functionLocation.body && result.valueDeclaration.pos >= functionLocation.body.pos && result.valueDeclaration.end <= functionLocation.body.end &&
+                                    ((findAncestor(originalLocation, isFunctionLikeDeclaration) !== functionLocation) || isParameter(lastLocation))) {
                                     useResult = false;
                                 }
                                 else if (result.flags & SymbolFlags.FunctionScopedVariable) {
diff --git a/tests/baselines/reference/parameterInitializersForwardReferencing1.errors.txt b/tests/baselines/reference/parameterInitializersForwardReferencing1.errors.txt
index 73f4f27d08b48..cb2ffeb2957e2 100644
--- a/tests/baselines/reference/parameterInitializersForwardReferencing1.errors.txt
+++ b/tests/baselines/reference/parameterInitializersForwardReferencing1.errors.txt
@@ -4,9 +4,10 @@ tests/cases/conformance/functions/parameterInitializersForwardReferencing1.ts(13
 tests/cases/conformance/functions/parameterInitializersForwardReferencing1.ts(21,18): error TS2372: Parameter 'a' cannot be referenced in its initializer.
 tests/cases/conformance/functions/parameterInitializersForwardReferencing1.ts(25,22): error TS2372: Parameter 'async' cannot be referenced in its initializer.
 tests/cases/conformance/functions/parameterInitializersForwardReferencing1.ts(29,15): error TS2448: Block-scoped variable 'foo' used before its declaration.
+tests/cases/conformance/functions/parameterInitializersForwardReferencing1.ts(40,25): error TS2373: Initializer of parameter 'bar' cannot reference identifier 'bazzzz' declared after it.
 
 
-==== tests/cases/conformance/functions/parameterInitializersForwardReferencing1.ts (6 errors) ====
+==== tests/cases/conformance/functions/parameterInitializersForwardReferencing1.ts (7 errors) ====
     let foo: string = "";
     
     function f1 (bar = foo) { // unexpected compiler error; works at runtime
@@ -57,4 +58,12 @@ tests/cases/conformance/functions/parameterInitializersForwardReferencing1.ts(29
     }
     
     function f8(foo1: string, bar = foo1) { }
+    
+    let bazzzz = 2;
+    function f9(bar = () => bazzzz) {
+                            ~~~~~~
+!!! error TS2373: Initializer of parameter 'bar' cannot reference identifier 'bazzzz' declared after it.
+        var bazzzz = 1;
+        return bar();
+    }
     
\ No newline at end of file
diff --git a/tests/baselines/reference/parameterInitializersForwardReferencing1.js b/tests/baselines/reference/parameterInitializersForwardReferencing1.js
index bd2b62e42169f..5ea2be44f48bc 100644
--- a/tests/baselines/reference/parameterInitializersForwardReferencing1.js
+++ b/tests/baselines/reference/parameterInitializersForwardReferencing1.js
@@ -36,6 +36,12 @@ class Foo {
 }
 
 function f8(foo1: string, bar = foo1) { }
+
+let bazzzz = 2;
+function f9(bar = () => bazzzz) {
+    var bazzzz = 1;
+    return bar();
+}
 
 
 //// [parameterInitializersForwardReferencing1.js]
@@ -86,3 +92,9 @@ var Foo = /** @class */ (function () {
 function f8(foo1, bar) {
     if (bar === void 0) { bar = foo1; }
 }
+var bazzzz = 2;
+function f9(bar) {
+    if (bar === void 0) { bar = function () { return bazzzz; }; }
+    var bazzzz = 1;
+    return bar();
+}
diff --git a/tests/baselines/reference/parameterInitializersForwardReferencing1.symbols b/tests/baselines/reference/parameterInitializersForwardReferencing1.symbols
index 74b00fe04b82b..fe9468caa9e93 100644
--- a/tests/baselines/reference/parameterInitializersForwardReferencing1.symbols
+++ b/tests/baselines/reference/parameterInitializersForwardReferencing1.symbols
@@ -90,3 +90,18 @@ function f8(foo1: string, bar = foo1) { }
 >bar : Symbol(bar, Decl(parameterInitializersForwardReferencing1.ts, 36, 25))
 >foo1 : Symbol(foo1, Decl(parameterInitializersForwardReferencing1.ts, 36, 12))
 
+let bazzzz = 2;
+>bazzzz : Symbol(bazzzz, Decl(parameterInitializersForwardReferencing1.ts, 38, 3))
+
+function f9(bar = () => bazzzz) {
+>f9 : Symbol(f9, Decl(parameterInitializersForwardReferencing1.ts, 38, 15))
+>bar : Symbol(bar, Decl(parameterInitializersForwardReferencing1.ts, 39, 12))
+>bazzzz : Symbol(bazzzz, Decl(parameterInitializersForwardReferencing1.ts, 40, 7))
+
+    var bazzzz = 1;
+>bazzzz : Symbol(bazzzz, Decl(parameterInitializersForwardReferencing1.ts, 40, 7))
+
+    return bar();
+>bar : Symbol(bar, Decl(parameterInitializersForwardReferencing1.ts, 39, 12))
+}
+
diff --git a/tests/baselines/reference/parameterInitializersForwardReferencing1.types b/tests/baselines/reference/parameterInitializersForwardReferencing1.types
index 2b80bfe87e06a..5dcf847297c7c 100644
--- a/tests/baselines/reference/parameterInitializersForwardReferencing1.types
+++ b/tests/baselines/reference/parameterInitializersForwardReferencing1.types
@@ -98,3 +98,22 @@ function f8(foo1: string, bar = foo1) { }
 >bar : string
 >foo1 : string
 
+let bazzzz = 2;
+>bazzzz : number
+>2 : 2
+
+function f9(bar = () => bazzzz) {
+>f9 : (bar?: () => number) => number
+>bar : () => number
+>() => bazzzz : () => number
+>bazzzz : number
+
+    var bazzzz = 1;
+>bazzzz : number
+>1 : 1
+
+    return bar();
+>bar() : number
+>bar : () => number
+}
+
diff --git a/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.errors.txt b/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.errors.txt
index c65f327161ebe..213a611c6627f 100644
--- a/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.errors.txt
+++ b/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.errors.txt
@@ -50,4 +50,10 @@ tests/cases/conformance/functions/parameterInitializersForwardReferencing1_es6.t
     }
     
     function f8(foo1: string, bar = foo1) { }
+    
+    let bazzzz = 2;
+    function f9(bar = () => bazzzz) {
+        var bazzzz = 1;
+        return bar();
+    }
     
\ No newline at end of file
diff --git a/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.js b/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.js
index ecabb8ceba9f6..f33d171d0085c 100644
--- a/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.js
+++ b/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.js
@@ -36,6 +36,12 @@ class Foo {
 }
 
 function f8(foo1: string, bar = foo1) { }
+
+let bazzzz = 2;
+function f9(bar = () => bazzzz) {
+    var bazzzz = 1;
+    return bar();
+}
 
 
 //// [parameterInitializersForwardReferencing1_es6.js]
@@ -70,3 +76,8 @@ class Foo {
     }
 }
 function f8(foo1, bar = foo1) { }
+let bazzzz = 2;
+function f9(bar = () => bazzzz) {
+    var bazzzz = 1;
+    return bar();
+}
diff --git a/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.symbols b/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.symbols
index dcd204beb7b0a..0ee9611c754bc 100644
--- a/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.symbols
+++ b/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.symbols
@@ -90,3 +90,18 @@ function f8(foo1: string, bar = foo1) { }
 >bar : Symbol(bar, Decl(parameterInitializersForwardReferencing1_es6.ts, 36, 25))
 >foo1 : Symbol(foo1, Decl(parameterInitializersForwardReferencing1_es6.ts, 36, 12))
 
+let bazzzz = 2;
+>bazzzz : Symbol(bazzzz, Decl(parameterInitializersForwardReferencing1_es6.ts, 38, 3))
+
+function f9(bar = () => bazzzz) {
+>f9 : Symbol(f9, Decl(parameterInitializersForwardReferencing1_es6.ts, 38, 15))
+>bar : Symbol(bar, Decl(parameterInitializersForwardReferencing1_es6.ts, 39, 12))
+>bazzzz : Symbol(bazzzz, Decl(parameterInitializersForwardReferencing1_es6.ts, 38, 3))
+
+    var bazzzz = 1;
+>bazzzz : Symbol(bazzzz, Decl(parameterInitializersForwardReferencing1_es6.ts, 40, 7))
+
+    return bar();
+>bar : Symbol(bar, Decl(parameterInitializersForwardReferencing1_es6.ts, 39, 12))
+}
+
diff --git a/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.types b/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.types
index 8fc5d84ae8efc..98d664566a5f2 100644
--- a/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.types
+++ b/tests/baselines/reference/parameterInitializersForwardReferencing1_es6.types
@@ -98,3 +98,22 @@ function f8(foo1: string, bar = foo1) { }
 >bar : string
 >foo1 : string
 
+let bazzzz = 2;
+>bazzzz : number
+>2 : 2
+
+function f9(bar = () => bazzzz) {
+>f9 : (bar?: () => number) => number
+>bar : () => number
+>() => bazzzz : () => number
+>bazzzz : number
+
+    var bazzzz = 1;
+>bazzzz : number
+>1 : 1
+
+    return bar();
+>bar() : number
+>bar : () => number
+}
+
diff --git a/tests/cases/conformance/functions/parameterInitializersForwardReferencing1.ts b/tests/cases/conformance/functions/parameterInitializersForwardReferencing1.ts
index a3b88150f4f37..c43b994e61c49 100644
--- a/tests/cases/conformance/functions/parameterInitializersForwardReferencing1.ts
+++ b/tests/cases/conformance/functions/parameterInitializersForwardReferencing1.ts
@@ -35,3 +35,9 @@ class Foo {
 }
 
 function f8(foo1: string, bar = foo1) { }
+
+let bazzzz = 2;
+function f9(bar = () => bazzzz) {
+    var bazzzz = 1;
+    return bar();
+}
diff --git a/tests/cases/conformance/functions/parameterInitializersForwardReferencing1_es6.ts b/tests/cases/conformance/functions/parameterInitializersForwardReferencing1_es6.ts
index f83eb2dd34ec6..d5650727b9245 100644
--- a/tests/cases/conformance/functions/parameterInitializersForwardReferencing1_es6.ts
+++ b/tests/cases/conformance/functions/parameterInitializersForwardReferencing1_es6.ts
@@ -37,3 +37,9 @@ class Foo {
 }
 
 function f8(foo1: string, bar = foo1) { }
+
+let bazzzz = 2;
+function f9(bar = () => bazzzz) {
+    var bazzzz = 1;
+    return bar();
+}