diff --git a/compiler/frontend/src/org/jetbrains/kotlin/parsing/KotlinParsing.java b/compiler/frontend/src/org/jetbrains/kotlin/parsing/KotlinParsing.java
index 79af3435c21..5da9ef73611 100644
--- a/compiler/frontend/src/org/jetbrains/kotlin/parsing/KotlinParsing.java
+++ b/compiler/frontend/src/org/jetbrains/kotlin/parsing/KotlinParsing.java
@@ -53,7 +53,7 @@ public class KotlinParsing extends AbstractKotlinParsing {
     private static final TokenSet CLASS_NAME_RECOVERY_SET = TokenSet.orSet(TokenSet.create(LT, LPAR, COLON, LBRACE),
                                                                            TOP_LEVEL_DECLARATION_FIRST);
     private static final TokenSet TYPE_PARAMETER_GT_RECOVERY_SET = TokenSet.create(WHERE_KEYWORD, LPAR, COLON, LBRACE, GT);
-    private static final TokenSet PARAMETER_NAME_RECOVERY_SET = TokenSet.create(COLON, EQ, COMMA, RPAR);
+    private static final TokenSet PARAMETER_NAME_RECOVERY_SET = TokenSet.create(COLON, EQ, COMMA, RPAR, VAL_KEYWORD, VAR_KEYWORD);
     private static final TokenSet PACKAGE_NAME_RECOVERY_SET = TokenSet.create(DOT, EOL_OR_SEMICOLON);
     private static final TokenSet IMPORT_RECOVERY_SET = TokenSet.create(AS_KEYWORD, DOT, EOL_OR_SEMICOLON);
     private static final TokenSet TYPE_REF_FIRST = TokenSet.create(LBRACKET, IDENTIFIER, LPAR, HASH, DYNAMIC_KEYWORD);
diff --git a/compiler/testData/diagnostics/tests/incompleteCode/diagnosticWithSyntaxError/valNoName.kt b/compiler/testData/diagnostics/tests/incompleteCode/diagnosticWithSyntaxError/valNoName.kt
new file mode 100644
index 00000000000..054ff973a76
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/incompleteCode/diagnosticWithSyntaxError/valNoName.kt
@@ -0,0 +1,43 @@
+// VAL
+class A(
+        val<!SYNTAX!><!>
+        val x: Int,
+        val
+        private<!SYNTAX!><!> val z: Int,
+        val<!SYNTAX!><!>
+)
+
+val<!SYNTAX!><!>
+fun foo() {}
+
+class B {
+    val<!SYNTAX!><!>
+    fun foo() {}
+
+    fun bar() {
+        val<!SYNTAX!><!>
+        fun foo() {}
+    }
+}
+
+// VAR
+class C(
+        var<!SYNTAX!><!>
+        val x: Int,
+        var
+        private<!SYNTAX!><!> val z: Int,
+        var<!SYNTAX!><!>
+)
+
+var<!SYNTAX!><!>
+fun baz() {}
+
+class D {
+    var<!SYNTAX!><!>
+    fun foo() {}
+
+    fun bar() {
+        var<!SYNTAX!><!>
+        fun foo() {}
+    }
+}
diff --git a/compiler/testData/diagnostics/tests/incompleteCode/diagnosticWithSyntaxError/valNoName.txt b/compiler/testData/diagnostics/tests/incompleteCode/diagnosticWithSyntaxError/valNoName.txt
new file mode 100644
index 00000000000..956f577ce08
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/incompleteCode/diagnosticWithSyntaxError/valNoName.txt
@@ -0,0 +1,50 @@
+package
+
+public val <no name provided>: [ERROR : No type, no body]
+public var <no name provided>: [ERROR : No type, no body]
+public fun baz(): kotlin.Unit
+public fun foo(): kotlin.Unit
+
+public final class A {
+    public constructor A(/*0*/ <no name provided>: [ERROR : Type annotation was missing for parameter <no name provided>], /*1*/ x: kotlin.Int, /*2*/ private: [ERROR : Type annotation was missing for parameter private], /*3*/ z: kotlin.Int, /*4*/ <no name provided>: [ERROR : Type annotation was missing for parameter <no name provided>])
+    public final val <no name provided>: [ERROR : Annotation is absent]
+    public final val <no name provided>: [ERROR : Annotation is absent]
+    public final val private: [ERROR : Annotation is absent]
+    public final val x: kotlin.Int
+    public final val z: kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+}
+
+public final class B {
+    public constructor B()
+    public final val <no name provided>: [ERROR : No type, no body]
+    public final fun bar(): kotlin.Unit
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public final fun foo(): kotlin.Unit
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+}
+
+public final class C {
+    public constructor C(/*0*/ <no name provided>: [ERROR : Type annotation was missing for parameter <no name provided>], /*1*/ x: kotlin.Int, /*2*/ private: [ERROR : Type annotation was missing for parameter private], /*3*/ z: kotlin.Int, /*4*/ <no name provided>: [ERROR : Type annotation was missing for parameter <no name provided>])
+    public final var <no name provided>: [ERROR : Annotation is absent]
+    public final var <no name provided>: [ERROR : Annotation is absent]
+    public final var private: [ERROR : Annotation is absent]
+    public final val x: kotlin.Int
+    public final val z: kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+}
+
+public final class D {
+    public constructor D()
+    public final var <no name provided>: [ERROR : No type, no body]
+    public final fun bar(): kotlin.Unit
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public final fun foo(): kotlin.Unit
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+}
diff --git a/compiler/testData/psi/recovery/ValNoName.kt b/compiler/testData/psi/recovery/ValNoName.kt
new file mode 100644
index 00000000000..0b4e7b80d4f
--- /dev/null
+++ b/compiler/testData/psi/recovery/ValNoName.kt
@@ -0,0 +1,43 @@
+// VAL
+class A(
+        val
+        val x: Int,
+        val
+        private val z: Int,
+        val
+)
+
+val
+fun foo() {}
+
+class B {
+    val
+    fun foo() {}
+
+    fun bar() {
+        val
+        fun foo() {}
+    }
+}
+
+// VAR
+class C(
+        var
+        val x: Int,
+        var
+        private val z: Int,
+        var
+)
+
+var
+fun baz() {}
+
+class D {
+    var
+    fun foo() {}
+
+    fun bar() {
+        var
+        fun foo() {}
+    }
+}
diff --git a/compiler/testData/psi/recovery/ValNoName.txt b/compiler/testData/psi/recovery/ValNoName.txt
new file mode 100644
index 00000000000..d9601b5bba3
--- /dev/null
+++ b/compiler/testData/psi/recovery/ValNoName.txt
@@ -0,0 +1,258 @@
+JetFile: ValNoName.kt
+  PACKAGE_DIRECTIVE
+    <empty list>
+  IMPORT_LIST
+    <empty list>
+  CLASS
+    PsiComment(EOL_COMMENT)('// VAL')
+    PsiWhiteSpace('\n')
+    PsiElement(class)('class')
+    PsiWhiteSpace(' ')
+    PsiElement(IDENTIFIER)('A')
+    PRIMARY_CONSTRUCTOR
+      VALUE_PARAMETER_LIST
+        PsiElement(LPAR)('(')
+        PsiWhiteSpace('\n        ')
+        VALUE_PARAMETER
+          PsiElement(val)('val')
+          PsiErrorElement:Parameter name expected
+            <empty list>
+        PsiWhiteSpace('\n        ')
+        VALUE_PARAMETER
+          PsiElement(val)('val')
+          PsiWhiteSpace(' ')
+          PsiElement(IDENTIFIER)('x')
+          PsiElement(COLON)(':')
+          PsiWhiteSpace(' ')
+          TYPE_REFERENCE
+            USER_TYPE
+              REFERENCE_EXPRESSION
+                PsiElement(IDENTIFIER)('Int')
+        PsiElement(COMMA)(',')
+        PsiWhiteSpace('\n        ')
+        VALUE_PARAMETER
+          PsiElement(val)('val')
+          PsiWhiteSpace('\n        ')
+          PsiElement(IDENTIFIER)('private')
+          PsiErrorElement:Parameters must have type annotation
+            <empty list>
+        PsiWhiteSpace(' ')
+        VALUE_PARAMETER
+          PsiElement(val)('val')
+          PsiWhiteSpace(' ')
+          PsiElement(IDENTIFIER)('z')
+          PsiElement(COLON)(':')
+          PsiWhiteSpace(' ')
+          TYPE_REFERENCE
+            USER_TYPE
+              REFERENCE_EXPRESSION
+                PsiElement(IDENTIFIER)('Int')
+        PsiElement(COMMA)(',')
+        PsiWhiteSpace('\n        ')
+        VALUE_PARAMETER
+          PsiElement(val)('val')
+          PsiErrorElement:Parameter name expected
+            <empty list>
+        PsiWhiteSpace('\n')
+        PsiElement(RPAR)(')')
+  PsiWhiteSpace('\n\n')
+  PROPERTY
+    PsiElement(val)('val')
+    PsiErrorElement:Expecting property name or receiver type
+      <empty list>
+  PsiWhiteSpace('\n')
+  FUN
+    PsiElement(fun)('fun')
+    PsiWhiteSpace(' ')
+    PsiElement(IDENTIFIER)('foo')
+    VALUE_PARAMETER_LIST
+      PsiElement(LPAR)('(')
+      PsiElement(RPAR)(')')
+    PsiWhiteSpace(' ')
+    BLOCK
+      PsiElement(LBRACE)('{')
+      PsiElement(RBRACE)('}')
+  PsiWhiteSpace('\n\n')
+  CLASS
+    PsiElement(class)('class')
+    PsiWhiteSpace(' ')
+    PsiElement(IDENTIFIER)('B')
+    PsiWhiteSpace(' ')
+    CLASS_BODY
+      PsiElement(LBRACE)('{')
+      PsiWhiteSpace('\n    ')
+      PROPERTY
+        PsiElement(val)('val')
+        PsiErrorElement:Expecting property name or receiver type
+          <empty list>
+      PsiWhiteSpace('\n    ')
+      FUN
+        PsiElement(fun)('fun')
+        PsiWhiteSpace(' ')
+        PsiElement(IDENTIFIER)('foo')
+        VALUE_PARAMETER_LIST
+          PsiElement(LPAR)('(')
+          PsiElement(RPAR)(')')
+        PsiWhiteSpace(' ')
+        BLOCK
+          PsiElement(LBRACE)('{')
+          PsiElement(RBRACE)('}')
+      PsiWhiteSpace('\n\n    ')
+      FUN
+        PsiElement(fun)('fun')
+        PsiWhiteSpace(' ')
+        PsiElement(IDENTIFIER)('bar')
+        VALUE_PARAMETER_LIST
+          PsiElement(LPAR)('(')
+          PsiElement(RPAR)(')')
+        PsiWhiteSpace(' ')
+        BLOCK
+          PsiElement(LBRACE)('{')
+          PsiWhiteSpace('\n        ')
+          PROPERTY
+            PsiElement(val)('val')
+            PsiErrorElement:Expecting property name or receiver type
+              <empty list>
+          PsiWhiteSpace('\n        ')
+          FUN
+            PsiElement(fun)('fun')
+            PsiWhiteSpace(' ')
+            PsiElement(IDENTIFIER)('foo')
+            VALUE_PARAMETER_LIST
+              PsiElement(LPAR)('(')
+              PsiElement(RPAR)(')')
+            PsiWhiteSpace(' ')
+            BLOCK
+              PsiElement(LBRACE)('{')
+              PsiElement(RBRACE)('}')
+          PsiWhiteSpace('\n    ')
+          PsiElement(RBRACE)('}')
+      PsiWhiteSpace('\n')
+      PsiElement(RBRACE)('}')
+  PsiWhiteSpace('\n\n')
+  CLASS
+    PsiComment(EOL_COMMENT)('// VAR')
+    PsiWhiteSpace('\n')
+    PsiElement(class)('class')
+    PsiWhiteSpace(' ')
+    PsiElement(IDENTIFIER)('C')
+    PRIMARY_CONSTRUCTOR
+      VALUE_PARAMETER_LIST
+        PsiElement(LPAR)('(')
+        PsiWhiteSpace('\n        ')
+        VALUE_PARAMETER
+          PsiElement(var)('var')
+          PsiErrorElement:Parameter name expected
+            <empty list>
+        PsiWhiteSpace('\n        ')
+        VALUE_PARAMETER
+          PsiElement(val)('val')
+          PsiWhiteSpace(' ')
+          PsiElement(IDENTIFIER)('x')
+          PsiElement(COLON)(':')
+          PsiWhiteSpace(' ')
+          TYPE_REFERENCE
+            USER_TYPE
+              REFERENCE_EXPRESSION
+                PsiElement(IDENTIFIER)('Int')
+        PsiElement(COMMA)(',')
+        PsiWhiteSpace('\n        ')
+        VALUE_PARAMETER
+          PsiElement(var)('var')
+          PsiWhiteSpace('\n        ')
+          PsiElement(IDENTIFIER)('private')
+          PsiErrorElement:Parameters must have type annotation
+            <empty list>
+        PsiWhiteSpace(' ')
+        VALUE_PARAMETER
+          PsiElement(val)('val')
+          PsiWhiteSpace(' ')
+          PsiElement(IDENTIFIER)('z')
+          PsiElement(COLON)(':')
+          PsiWhiteSpace(' ')
+          TYPE_REFERENCE
+            USER_TYPE
+              REFERENCE_EXPRESSION
+                PsiElement(IDENTIFIER)('Int')
+        PsiElement(COMMA)(',')
+        PsiWhiteSpace('\n        ')
+        VALUE_PARAMETER
+          PsiElement(var)('var')
+          PsiErrorElement:Parameter name expected
+            <empty list>
+        PsiWhiteSpace('\n')
+        PsiElement(RPAR)(')')
+  PsiWhiteSpace('\n\n')
+  PROPERTY
+    PsiElement(var)('var')
+    PsiErrorElement:Expecting property name or receiver type
+      <empty list>
+  PsiWhiteSpace('\n')
+  FUN
+    PsiElement(fun)('fun')
+    PsiWhiteSpace(' ')
+    PsiElement(IDENTIFIER)('baz')
+    VALUE_PARAMETER_LIST
+      PsiElement(LPAR)('(')
+      PsiElement(RPAR)(')')
+    PsiWhiteSpace(' ')
+    BLOCK
+      PsiElement(LBRACE)('{')
+      PsiElement(RBRACE)('}')
+  PsiWhiteSpace('\n\n')
+  CLASS
+    PsiElement(class)('class')
+    PsiWhiteSpace(' ')
+    PsiElement(IDENTIFIER)('D')
+    PsiWhiteSpace(' ')
+    CLASS_BODY
+      PsiElement(LBRACE)('{')
+      PsiWhiteSpace('\n    ')
+      PROPERTY
+        PsiElement(var)('var')
+        PsiErrorElement:Expecting property name or receiver type
+          <empty list>
+      PsiWhiteSpace('\n    ')
+      FUN
+        PsiElement(fun)('fun')
+        PsiWhiteSpace(' ')
+        PsiElement(IDENTIFIER)('foo')
+        VALUE_PARAMETER_LIST
+          PsiElement(LPAR)('(')
+          PsiElement(RPAR)(')')
+        PsiWhiteSpace(' ')
+        BLOCK
+          PsiElement(LBRACE)('{')
+          PsiElement(RBRACE)('}')
+      PsiWhiteSpace('\n\n    ')
+      FUN
+        PsiElement(fun)('fun')
+        PsiWhiteSpace(' ')
+        PsiElement(IDENTIFIER)('bar')
+        VALUE_PARAMETER_LIST
+          PsiElement(LPAR)('(')
+          PsiElement(RPAR)(')')
+        PsiWhiteSpace(' ')
+        BLOCK
+          PsiElement(LBRACE)('{')
+          PsiWhiteSpace('\n        ')
+          PROPERTY
+            PsiElement(var)('var')
+            PsiErrorElement:Expecting property name or receiver type
+              <empty list>
+          PsiWhiteSpace('\n        ')
+          FUN
+            PsiElement(fun)('fun')
+            PsiWhiteSpace(' ')
+            PsiElement(IDENTIFIER)('foo')
+            VALUE_PARAMETER_LIST
+              PsiElement(LPAR)('(')
+              PsiElement(RPAR)(')')
+            PsiWhiteSpace(' ')
+            BLOCK
+              PsiElement(LBRACE)('{')
+              PsiElement(RBRACE)('}')
+          PsiWhiteSpace('\n    ')
+          PsiElement(RBRACE)('}')
+      PsiWhiteSpace('\n')
+      PsiElement(RBRACE)('}')
diff --git a/compiler/tests/org/jetbrains/kotlin/checkers/DiagnosticsTestGenerated.java b/compiler/tests/org/jetbrains/kotlin/checkers/DiagnosticsTestGenerated.java
index 1bb1d10fa0c..bfc5c45987b 100644
--- a/compiler/tests/org/jetbrains/kotlin/checkers/DiagnosticsTestGenerated.java
+++ b/compiler/tests/org/jetbrains/kotlin/checkers/DiagnosticsTestGenerated.java
@@ -8776,6 +8776,12 @@ public class DiagnosticsTestGenerated extends AbstractDiagnosticsTest {
                     String fileName = KotlinTestUtils.navigationMetadata("compiler/testData/diagnostics/tests/incompleteCode/diagnosticWithSyntaxError/typeReferenceError.kt");
                     doTest(fileName);
                 }
+
+                @TestMetadata("valNoName.kt")
+                public void testValNoName() throws Exception {
+                    String fileName = KotlinTestUtils.navigationMetadata("compiler/testData/diagnostics/tests/incompleteCode/diagnosticWithSyntaxError/valNoName.kt");
+                    doTest(fileName);
+                }
             }
         }
 
diff --git a/compiler/tests/org/jetbrains/kotlin/parsing/ParsingTestGenerated.java b/compiler/tests/org/jetbrains/kotlin/parsing/ParsingTestGenerated.java
index e43dca1e4a6..133646a63c0 100644
--- a/compiler/tests/org/jetbrains/kotlin/parsing/ParsingTestGenerated.java
+++ b/compiler/tests/org/jetbrains/kotlin/parsing/ParsingTestGenerated.java
@@ -2262,6 +2262,12 @@ public class ParsingTestGenerated extends AbstractParsingTest {
                 doParsingTest(fileName);
             }
 
+            @TestMetadata("ValNoName.kt")
+            public void testValNoName() throws Exception {
+                String fileName = KotlinTestUtils.navigationMetadata("compiler/testData/psi/recovery/ValNoName.kt");
+                doParsingTest(fileName);
+            }
+
             @TestMetadata("ValueParameterNoTypeRecovery.kt")
             public void testValueParameterNoTypeRecovery() throws Exception {
                 String fileName = KotlinTestUtils.navigationMetadata("compiler/testData/psi/recovery/ValueParameterNoTypeRecovery.kt");