diff --git a/compiler/testData/kotlinClassFinder/nestedClass.kt b/compiler/testData/kotlinClassFinder/nestedClass.kt
new file mode 100644
index 00000000000..f490cddee17
--- /dev/null
+++ b/compiler/testData/kotlinClassFinder/nestedClass.kt
@@ -0,0 +1,8 @@
+package test
+
+class A {
+    class B {
+        class C {
+        }
+    }
+}
\ No newline at end of file
diff --git a/compiler/tests/org/jetbrains/jet/JetTestUtils.java b/compiler/tests/org/jetbrains/jet/JetTestUtils.java
index 96d2e189cf0..667dabd3179 100644
--- a/compiler/tests/org/jetbrains/jet/JetTestUtils.java
+++ b/compiler/tests/org/jetbrains/jet/JetTestUtils.java
@@ -307,6 +307,7 @@ public class JetTestUtils {
         }
     }
 
+    @NotNull
     public static File tmpDirForTest(TestCase test) throws IOException {
         File answer = FileUtil.createTempDirectory(test.getClass().getSimpleName(), test.getName());
         deleteOnShutdown(answer);
@@ -782,6 +783,7 @@ public class JetTestUtils {
         return jetFiles;
     }
 
+    @NotNull
     public static ModuleDescriptorImpl createEmptyModule() {
         return createEmptyModule("<empty-for-test>");
     }
diff --git a/compiler/tests/org/jetbrains/jet/jvm/compiler/KotlinClassFinderTest.kt b/compiler/tests/org/jetbrains/jet/jvm/compiler/KotlinClassFinderTest.kt
new file mode 100644
index 00000000000..0bbf0f5043c
--- /dev/null
+++ b/compiler/tests/org/jetbrains/jet/jvm/compiler/KotlinClassFinderTest.kt
@@ -0,0 +1,54 @@
+/*
+ * Copyright 2010-2014 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.
+ * You may obtain a copy of the License at
+ *
+ * http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing, software
+ * distributed under the License is distributed on an "AS IS" BASIS,
+ * WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+ * See the License for the specific language governing permissions and
+ * limitations under the License.
+ */
+
+package org.jetbrains.jet.jvm.compiler
+
+import org.jetbrains.jet.KotlinTestWithEnvironmentManagement
+import org.jetbrains.jet.JetTestUtils
+import java.io.File
+import org.jetbrains.jet.cli.jvm.compiler.JetCoreEnvironment
+import org.jetbrains.jet.ConfigurationKind
+import org.jetbrains.jet.TestJdkKind
+import org.jetbrains.jet.lang.resolve.kotlin.VirtualFileFinder
+import com.intellij.psi.JavaPsiFacade
+import com.intellij.psi.search.GlobalSearchScope
+import org.jetbrains.jet.lang.resolve.java.structure.impl.JavaClassImpl
+import kotlin.test.assertEquals
+import kotlin.test.assertNotNull
+
+public class KotlinClassFinderTest : KotlinTestWithEnvironmentManagement() {
+    fun testNestedClass() {
+        val tmpdir = JetTestUtils.tmpDirForTest(this)
+        JetTestUtils.compileKotlinWithJava(
+                listOf(), listOf(File("compiler/testData/kotlinClassFinder/nestedClass.kt")), tmpdir, getTestRootDisposable()!!
+        )
+
+        val environment = JetCoreEnvironment.createForTests(getTestRootDisposable()!!,
+                                                            JetTestUtils.compilerConfigurationForTests(
+                                                                    ConfigurationKind.ALL, TestJdkKind.MOCK_JDK, tmpdir))
+
+        val project = environment.getProject()
+        val className = "test.A.B.C"
+        val psiClass = JavaPsiFacade.getInstance(project).findClass(className, GlobalSearchScope.allScope(project))
+        assertNotNull(psiClass, "Psi class not found for $className")
+
+        val binaryClass = VirtualFileFinder.SERVICE.getInstance(project).findKotlinClass(JavaClassImpl(psiClass!!))
+        assertNotNull(binaryClass, "No binary class for $className")
+
+        assertEquals("test/A\$B\$C", binaryClass?.getClassName()?.getInternalName())
+    }
+}
+