diff --git a/compiler/frontend/src/org/jetbrains/kotlin/resolve/FunctionDescriptorResolver.kt b/compiler/frontend/src/org/jetbrains/kotlin/resolve/FunctionDescriptorResolver.kt
index 316e25e0633..9d30768dedb 100644
--- a/compiler/frontend/src/org/jetbrains/kotlin/resolve/FunctionDescriptorResolver.kt
+++ b/compiler/frontend/src/org/jetbrains/kotlin/resolve/FunctionDescriptorResolver.kt
@@ -1,5 +1,5 @@
 /*
- * Copyright 2010-2016 JetBrains s.r.o.
+ * Copyright 2010-2017 JetBrains s.r.o.
  *
  * Licensed under the Apache License, Version 2.0 (the "License");
  * you may not use this file except in compliance with the License.
@@ -51,6 +51,7 @@ import org.jetbrains.kotlin.types.ErrorUtils
 import org.jetbrains.kotlin.types.KotlinType
 import org.jetbrains.kotlin.types.TypeUtils
 import org.jetbrains.kotlin.types.checker.KotlinTypeChecker
+import org.jetbrains.kotlin.types.expressions.ExpressionTypingUtils
 import org.jetbrains.kotlin.types.expressions.ExpressionTypingUtils.isFunctionExpression
 import org.jetbrains.kotlin.types.expressions.ExpressionTypingUtils.isFunctionLiteral
 import org.jetbrains.kotlin.types.typeUtil.replaceAnnotations
@@ -375,6 +376,10 @@ class FunctionDescriptorResolver(
 
             val valueParameterDescriptor = descriptorResolver.resolveValueParameterDescriptor(parameterScope, functionDescriptor,
                                                                                               valueParameter, i, type, trace)
+
+            // Do not report NAME_SHADOWING for lambda destructured parameters as they may be not fully resolved at this time
+            ExpressionTypingUtils.checkVariableShadowing(parameterScope, trace, valueParameterDescriptor)
+
             parameterScope.addVariableDescriptor(valueParameterDescriptor)
             result.add(valueParameterDescriptor)
         }
diff --git a/compiler/testData/diagnostics/tests/annotations/blockLevelOnTheSameLineWarning.kt b/compiler/testData/diagnostics/tests/annotations/blockLevelOnTheSameLineWarning.kt
index 49a13881b87..5338b94f9f9 100644
--- a/compiler/testData/diagnostics/tests/annotations/blockLevelOnTheSameLineWarning.kt
+++ b/compiler/testData/diagnostics/tests/annotations/blockLevelOnTheSameLineWarning.kt
@@ -30,8 +30,8 @@ fun foo(y: IntArray) {
 
     @Ann1 y[0]
 
-    @Ann1 <!UNUSED_LAMBDA_EXPRESSION!>{ x: Int -> x }<!>
-    @Ann1 { x: Int -> x }(1)
+    @Ann1 <!UNUSED_LAMBDA_EXPRESSION!>{ <!NAME_SHADOWING!>x<!>: Int -> x }<!>
+    @Ann1 { <!NAME_SHADOWING!>x<!>: Int -> x }(1)
     @Ann1 object { fun foo() = 1 }
     @Ann1 object { fun foo() = 1 }.foo()
 
@@ -45,8 +45,8 @@ fun foo(y: IntArray) {
     <!ANNOTATIONS_ON_BLOCK_LEVEL_EXPRESSION_ON_THE_SAME_LINE!>@Ann1 x<!> + 6 * 2 > 0
     <!ANNOTATIONS_ON_BLOCK_LEVEL_EXPRESSION_ON_THE_SAME_LINE!>@Ann1 x<!> * 6 + 2 > 0
 
-    <!ANNOTATIONS_ON_BLOCK_LEVEL_EXPRESSION_ON_THE_SAME_LINE!>@Ann1 object { operator fun plus(x: Int) = 1 }<!> + 1
-    <!ANNOTATIONS_ON_BLOCK_LEVEL_EXPRESSION_ON_THE_SAME_LINE!>@Ann1 object { operator fun plus(x: Int) = 1 }<!> + 1 * 4 > 0
+    <!ANNOTATIONS_ON_BLOCK_LEVEL_EXPRESSION_ON_THE_SAME_LINE!>@Ann1 object { operator fun plus(<!NAME_SHADOWING!>x<!>: Int) = 1 }<!> + 1
+    <!ANNOTATIONS_ON_BLOCK_LEVEL_EXPRESSION_ON_THE_SAME_LINE!>@Ann1 object { operator fun plus(<!NAME_SHADOWING!>x<!>: Int) = 1 }<!> + 1 * 4 > 0
 
     <!ANNOTATIONS_ON_BLOCK_LEVEL_EXPRESSION_ON_THE_SAME_LINE!>@Ann1 x<!> foo z + 8
 
diff --git a/compiler/testData/diagnostics/tests/annotations/options/targets/funtypeargs.kt b/compiler/testData/diagnostics/tests/annotations/options/targets/funtypeargs.kt
index e73805383bf..bf63064be24 100644
--- a/compiler/testData/diagnostics/tests/annotations/options/targets/funtypeargs.kt
+++ b/compiler/testData/diagnostics/tests/annotations/options/targets/funtypeargs.kt
@@ -9,5 +9,5 @@ fun transform(i: Int, tr: (<!WRONG_ANNOTATION_TARGET!>@special<!> Int) -> Int):
 fun foo(i: Int): Int {
     val j = @special i + 1
     if (j == 1) return foo(@special 42)
-    return transform(@special j, @special { i: @base Int -> <!ANNOTATIONS_ON_BLOCK_LEVEL_EXPRESSION_ON_THE_SAME_LINE!><!WRONG_ANNOTATION_TARGET!>@base<!> i<!> * 2 })
+    return transform(@special j, @special { <!NAME_SHADOWING!>i<!>: @base Int -> <!ANNOTATIONS_ON_BLOCK_LEVEL_EXPRESSION_ON_THE_SAME_LINE!><!WRONG_ANNOTATION_TARGET!>@base<!> i<!> * 2 })
 }
diff --git a/compiler/testData/diagnostics/tests/dataClasses/repeatedProperties.kt b/compiler/testData/diagnostics/tests/dataClasses/repeatedProperties.kt
index 5713d718dcf..fac59fb631f 100644
--- a/compiler/testData/diagnostics/tests/dataClasses/repeatedProperties.kt
+++ b/compiler/testData/diagnostics/tests/dataClasses/repeatedProperties.kt
@@ -1,4 +1,4 @@
-data class A1(val <!REDECLARATION, REDECLARATION, REDECLARATION!>x<!>: Int, val y: String, val <!REDECLARATION, REDECLARATION, REDECLARATION!>x<!>: Int) {
+data class A1(val <!REDECLARATION, REDECLARATION, REDECLARATION!>x<!>: Int, val y: String, val <!NAME_SHADOWING, REDECLARATION, REDECLARATION, REDECLARATION!>x<!>: Int) {
     val z = ""
 }
 
diff --git a/compiler/testData/diagnostics/tests/declarationChecks/mulitpleVarargParameters.kt b/compiler/testData/diagnostics/tests/declarationChecks/mulitpleVarargParameters.kt
index 18cb39641c0..f055c04c69d 100644
--- a/compiler/testData/diagnostics/tests/declarationChecks/mulitpleVarargParameters.kt
+++ b/compiler/testData/diagnostics/tests/declarationChecks/mulitpleVarargParameters.kt
@@ -1,10 +1,10 @@
 // !DIAGNOSTICS: -UNUSED_PARAMETER -PRIMARY_CONSTRUCTOR_DELEGATION_CALL_EXPECTED
 fun test(<!MULTIPLE_VARARG_PARAMETERS!>vararg<!> x1: Int, <!MULTIPLE_VARARG_PARAMETERS!>vararg<!> x2: Int) {
-    fun test2(<!MULTIPLE_VARARG_PARAMETERS!>vararg<!> x1: Int, <!MULTIPLE_VARARG_PARAMETERS!>vararg<!> x2: Int) {
-        class LocalClass(<!MULTIPLE_VARARG_PARAMETERS!>vararg<!> x1: Int, <!MULTIPLE_VARARG_PARAMETERS!>vararg<!> x2: Int) {
-            constructor(<!MULTIPLE_VARARG_PARAMETERS!>vararg<!> x1: Int, <!MULTIPLE_VARARG_PARAMETERS!>vararg<!> x2: Int, xx: Int) {}
-        }
-        fun test3(<!MULTIPLE_VARARG_PARAMETERS!>vararg<!> x1: Int, <!MULTIPLE_VARARG_PARAMETERS!>vararg<!> x2: Int) {}
+    fun test2(<!MULTIPLE_VARARG_PARAMETERS!>vararg<!> <!NAME_SHADOWING!>x1<!>: Int, <!MULTIPLE_VARARG_PARAMETERS!>vararg<!> <!NAME_SHADOWING!>x2<!>: Int) {
+        class LocalClass(<!MULTIPLE_VARARG_PARAMETERS!>vararg<!> <!NAME_SHADOWING!>x1<!>: Int, <!MULTIPLE_VARARG_PARAMETERS!>vararg<!> <!NAME_SHADOWING!>x2<!>: Int) {
+        constructor(<!MULTIPLE_VARARG_PARAMETERS!>vararg<!> <!NAME_SHADOWING!>x1<!>: Int, <!MULTIPLE_VARARG_PARAMETERS!>vararg<!> <!NAME_SHADOWING!>x2<!>: Int, xx: Int) {}
+    }
+        fun test3(<!MULTIPLE_VARARG_PARAMETERS!>vararg<!> <!NAME_SHADOWING!>x1<!>: Int, <!MULTIPLE_VARARG_PARAMETERS!>vararg<!> <!NAME_SHADOWING!>x2<!>: Int) {}
     }
 }
 
diff --git a/compiler/testData/diagnostics/tests/functionLiterals/underscopeParameters.kt b/compiler/testData/diagnostics/tests/functionLiterals/underscopeParameters.kt
index afcb91126c0..cd90791f233 100644
--- a/compiler/testData/diagnostics/tests/functionLiterals/underscopeParameters.kt
+++ b/compiler/testData/diagnostics/tests/functionLiterals/underscopeParameters.kt
@@ -40,7 +40,7 @@ fun bar() {
         _ checkType { _<String>() }
     }
 
-    foo { <!REDECLARATION, REDECLARATION, UNUSED_ANONYMOUS_PARAMETER!>`_`<!>, <!REDECLARATION, REDECLARATION!>`_`<!> ->
+    foo { <!REDECLARATION, REDECLARATION, UNUSED_ANONYMOUS_PARAMETER!>`_`<!>, <!NAME_SHADOWING, REDECLARATION, REDECLARATION!>`_`<!> ->
         _ checkType { _<String>() }
     }
 
diff --git a/compiler/testData/diagnostics/tests/implicitIntersection.kt b/compiler/testData/diagnostics/tests/implicitIntersection.kt
index ea537a4f67d..dd7dd4cd625 100644
--- a/compiler/testData/diagnostics/tests/implicitIntersection.kt
+++ b/compiler/testData/diagnostics/tests/implicitIntersection.kt
@@ -22,6 +22,6 @@ fun bar(b: B): String {
     // Ok: local variable
     val tmp = if (b is A && b is C) b else null
     // Error: local function
-    fun <!IMPLICIT_INTERSECTION_TYPE!>foo<!>(b: B) = if (b is A && b is C) b else null
+    fun <!IMPLICIT_INTERSECTION_TYPE!>foo<!>(<!NAME_SHADOWING!>b<!>: B) = if (b is A && b is C) b else null
     return tmp.toString()
 }
\ No newline at end of file
diff --git a/compiler/testData/diagnostics/tests/inline/kt4869.kt b/compiler/testData/diagnostics/tests/inline/kt4869.kt
index 9c353f4e130..33527181766 100644
--- a/compiler/testData/diagnostics/tests/inline/kt4869.kt
+++ b/compiler/testData/diagnostics/tests/inline/kt4869.kt
@@ -1,5 +1,5 @@
 inline fun foo(f: () -> Unit) {
-    val ff = { f: () -> Unit ->
+    val ff = { <!NAME_SHADOWING!>f<!>: () -> Unit ->
         f.invoke()
     }
     ff(<!USAGE_IS_NOT_INLINABLE!>f<!>)
diff --git a/compiler/testData/diagnostics/tests/resolve/capturedTypesInLambdaParameter.kt b/compiler/testData/diagnostics/tests/resolve/capturedTypesInLambdaParameter.kt
index 7ebe2dacaa1..01a8f78943e 100644
--- a/compiler/testData/diagnostics/tests/resolve/capturedTypesInLambdaParameter.kt
+++ b/compiler/testData/diagnostics/tests/resolve/capturedTypesInLambdaParameter.kt
@@ -37,6 +37,6 @@ fun test(b: B<out Number>) {
     b.foo(Number::foobar)
 
     b.baz {
-        b -> b checkType { _<B<out Number>>() }
+        <!NAME_SHADOWING!>b<!> -> b checkType { _<B<out Number>>() }
     }
 }
diff --git a/compiler/testData/diagnostics/tests/shadowing/ShadowLambdaParameter.kt b/compiler/testData/diagnostics/tests/shadowing/ShadowLambdaParameter.kt
new file mode 100644
index 00000000000..0bcb8f31de6
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/shadowing/ShadowLambdaParameter.kt
@@ -0,0 +1,13 @@
+// !DIAGNOSTICS: -UNUSED_PARAMETER
+
+fun foo1(i: (Int) -> Unit) {}
+fun foo2(i: (Int, Int) -> Unit) {}
+fun foo3(i: (Pair) -> Unit) {}
+
+fun bar(x: Int, y: Int) {
+    foo1 { <!NAME_SHADOWING!>x<!> -> <!UNUSED_EXPRESSION!>x<!> }
+    foo2 { <!NAME_SHADOWING!>x<!>: Int, <!NAME_SHADOWING!>y<!>: Int -> x + y }
+    foo3 { (x, y) -> x + y }
+}
+
+data class Pair(val a: Int, val b: Int)
\ No newline at end of file
diff --git a/compiler/testData/diagnostics/tests/shadowing/ShadowLambdaParameter.txt b/compiler/testData/diagnostics/tests/shadowing/ShadowLambdaParameter.txt
new file mode 100644
index 00000000000..c21ed00fe0b
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/shadowing/ShadowLambdaParameter.txt
@@ -0,0 +1,18 @@
+package
+
+public fun bar(/*0*/ x: kotlin.Int, /*1*/ y: kotlin.Int): kotlin.Unit
+public fun foo1(/*0*/ i: (kotlin.Int) -> kotlin.Unit): kotlin.Unit
+public fun foo2(/*0*/ i: (kotlin.Int, kotlin.Int) -> kotlin.Unit): kotlin.Unit
+public fun foo3(/*0*/ i: (Pair) -> kotlin.Unit): kotlin.Unit
+
+public final data class Pair {
+    public constructor Pair(/*0*/ a: kotlin.Int, /*1*/ b: kotlin.Int)
+    public final val a: kotlin.Int
+    public final val b: kotlin.Int
+    public final operator /*synthesized*/ fun component1(): kotlin.Int
+    public final operator /*synthesized*/ fun component2(): kotlin.Int
+    public final /*synthesized*/ fun copy(/*0*/ a: kotlin.Int = ..., /*1*/ b: kotlin.Int = ...): Pair
+    public open override /*1*/ /*synthesized*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public open override /*1*/ /*synthesized*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*synthesized*/ fun toString(): kotlin.String
+}
diff --git a/compiler/testData/diagnostics/tests/shadowing/ShadowVariableInNestedClosureParam.kt b/compiler/testData/diagnostics/tests/shadowing/ShadowVariableInNestedClosureParam.kt
index f015847d3e6..bc3cbfdf0f8 100644
--- a/compiler/testData/diagnostics/tests/shadowing/ShadowVariableInNestedClosureParam.kt
+++ b/compiler/testData/diagnostics/tests/shadowing/ShadowVariableInNestedClosureParam.kt
@@ -1,5 +1,5 @@
 fun ff(): Int {
     var i = 1
-    <!UNUSED_LAMBDA_EXPRESSION!>{ i: Int -> i }<!>
+    <!UNUSED_LAMBDA_EXPRESSION!>{ <!NAME_SHADOWING!>i<!>: Int -> i }<!>
     return i
 }
diff --git a/compiler/testData/diagnostics/testsWithJsStdLib/noImpl.kt b/compiler/testData/diagnostics/testsWithJsStdLib/noImpl.kt
index 161bf5dab35..b8aa51bb43b 100644
--- a/compiler/testData/diagnostics/testsWithJsStdLib/noImpl.kt
+++ b/compiler/testData/diagnostics/testsWithJsStdLib/noImpl.kt
@@ -15,7 +15,7 @@ fun foo(x: Int, y: String = <!CALL_TO_DEFINED_EXTERNALLY_FROM_NON_EXTERNAL_DECLA
 
     listOf<String>()
             .map<String, String> { <!CALL_TO_DEFINED_EXTERNALLY_FROM_NON_EXTERNAL_DECLARATION!>definedExternally<!> }
-            .filter(fun(x: String): Boolean { <!CALL_TO_DEFINED_EXTERNALLY_FROM_NON_EXTERNAL_DECLARATION!>definedExternally<!> })
+            .filter(fun(<!NAME_SHADOWING!>x<!>: String): Boolean { <!CALL_TO_DEFINED_EXTERNALLY_FROM_NON_EXTERNAL_DECLARATION!>definedExternally<!> })
 
     <!CALL_TO_DEFINED_EXTERNALLY_FROM_NON_EXTERNAL_DECLARATION!>definedExternally<!>
 }
diff --git a/compiler/testData/diagnostics/testsWithStdLib/coroutines/lambdaExpectedType.kt b/compiler/testData/diagnostics/testsWithStdLib/coroutines/lambdaExpectedType.kt
index 089e83bf94a..c66e84f7f6f 100644
--- a/compiler/testData/diagnostics/testsWithStdLib/coroutines/lambdaExpectedType.kt
+++ b/compiler/testData/diagnostics/testsWithStdLib/coroutines/lambdaExpectedType.kt
@@ -44,7 +44,7 @@ fun foo() {
     manyArgumentsBuilder<String>({}, { "" }, { 1 })
     manyArgumentsBuilder<String>({}, { <!CONSTANT_EXPECTED_TYPE_MISMATCH!>1<!> }, { 2 })
 
-    severalParamsInLambda { x, y ->
+    severalParamsInLambda { <!NAME_SHADOWING!>x<!>, <!NAME_SHADOWING!>y<!> ->
         x checkType { _<String>() }
         y checkType { _<Int>() }
     }
diff --git a/compiler/tests/org/jetbrains/kotlin/checkers/DiagnosticsTestGenerated.java b/compiler/tests/org/jetbrains/kotlin/checkers/DiagnosticsTestGenerated.java
index a9c960b9c11..eb59d9251d4 100644
--- a/compiler/tests/org/jetbrains/kotlin/checkers/DiagnosticsTestGenerated.java
+++ b/compiler/tests/org/jetbrains/kotlin/checkers/DiagnosticsTestGenerated.java
@@ -19174,6 +19174,12 @@ public class DiagnosticsTestGenerated extends AbstractDiagnosticsTest {
                 KotlinTestUtils.assertAllTestsPresentByMetadata(this.getClass(), new File("compiler/testData/diagnostics/tests/shadowing"), Pattern.compile("^(.+)\\.kt$"), TargetBackend.ANY, true);
             }
 
+            @TestMetadata("ShadowLambdaParameter.kt")
+            public void testShadowLambdaParameter() throws Exception {
+                String fileName = KotlinTestUtils.navigationMetadata("compiler/testData/diagnostics/tests/shadowing/ShadowLambdaParameter.kt");
+                doTest(fileName);
+            }
+
             @TestMetadata("ShadowMultiDeclarationWithFunParameter.kt")
             public void testShadowMultiDeclarationWithFunParameter() throws Exception {
                 String fileName = KotlinTestUtils.navigationMetadata("compiler/testData/diagnostics/tests/shadowing/ShadowMultiDeclarationWithFunParameter.kt");