diff --git a/compiler/frontend/src/org/jetbrains/kotlin/diagnostics/Errors.java b/compiler/frontend/src/org/jetbrains/kotlin/diagnostics/Errors.java
index 4c36ab217ba..c5e6bc5ed2d 100644
--- a/compiler/frontend/src/org/jetbrains/kotlin/diagnostics/Errors.java
+++ b/compiler/frontend/src/org/jetbrains/kotlin/diagnostics/Errors.java
@@ -265,7 +265,7 @@ public interface Errors {
     DiagnosticFactory0<KtTypeReference> DYNAMIC_UPPER_BOUND = DiagnosticFactory0.create(ERROR);
     DiagnosticFactory0<KtTypeReference> UPPER_BOUND_IS_EXTENSION_FUNCTION_TYPE = DiagnosticFactory0.create(ERROR);
     DiagnosticFactory0<KtTypeReference> ONLY_ONE_CLASS_BOUND_ALLOWED = DiagnosticFactory0.create(ERROR);
-    DiagnosticFactory0<KtTypeParameter> BOUNDS_NOT_ALLOWED_IF_BOUNDED_BY_TYPE_PARAMETER = DiagnosticFactory0.create(ERROR);
+    DiagnosticFactory0<KtElement> BOUNDS_NOT_ALLOWED_IF_BOUNDED_BY_TYPE_PARAMETER = DiagnosticFactory0.create(ERROR);
     DiagnosticFactory0<KtTypeReference> REPEATED_BOUND = DiagnosticFactory0.create(ERROR);
 
     DiagnosticFactory1<KtNamedDeclaration, TypeParameterDescriptor> CONFLICTING_UPPER_BOUNDS =
diff --git a/compiler/frontend/src/org/jetbrains/kotlin/resolve/DeclarationsChecker.kt b/compiler/frontend/src/org/jetbrains/kotlin/resolve/DeclarationsChecker.kt
index a86441f6d16..219f68b7111 100644
--- a/compiler/frontend/src/org/jetbrains/kotlin/resolve/DeclarationsChecker.kt
+++ b/compiler/frontend/src/org/jetbrains/kotlin/resolve/DeclarationsChecker.kt
@@ -179,14 +179,38 @@ class DeclarationsChecker(
         }
     }
 
-    private fun checkOnlyOneTypeParameterBound(descriptor: TypeParameterDescriptor, declaration: KtTypeParameter) {
+    private fun checkOnlyOneTypeParameterBound(
+            descriptor: TypeParameterDescriptor, declaration: KtTypeParameter, owner: KtTypeParameterListOwner
+    ) {
         val upperBounds = descriptor.upperBounds
         val (boundsWhichAreTypeParameters, otherBounds) = upperBounds
                 .map { type -> type.constructor }
                 .partition { constructor -> constructor.declarationDescriptor is TypeParameterDescriptor }
                 .let { pair -> pair.first.toSet() to pair.second.toSet() }
-        if (boundsWhichAreTypeParameters.size > 1 || (boundsWhichAreTypeParameters.isNotEmpty() && otherBounds.isNotEmpty())) {
-            trace.report(BOUNDS_NOT_ALLOWED_IF_BOUNDED_BY_TYPE_PARAMETER.on(declaration))
+        if (boundsWhichAreTypeParameters.size > 1 || (boundsWhichAreTypeParameters.size == 1 && otherBounds.isNotEmpty())) {
+            val reportOn = if (boundsWhichAreTypeParameters.size + otherBounds.size == 2) {
+                // If there's only one problematic bound (either 2 type parameter bounds, or 1 type parameter bound + 1 other bound),
+                // report the diagnostic on that bound
+
+                val allBounds: List<Pair<KtTypeReference, KotlinType?>> =
+                        owner.typeConstraints
+                                .filter { constraint ->
+                                    constraint.subjectTypeParameterName?.getReferencedNameAsName() == declaration.nameAsName
+                                }
+                                .mapNotNull { constraint -> constraint.boundTypeReference }
+                                .map { typeReference -> typeReference to trace.bindingContext.get(TYPE, typeReference) }
+
+                val problematicBound =
+                        allBounds.firstOrNull { bound -> bound.second?.constructor != boundsWhichAreTypeParameters.first() }
+
+                problematicBound?.first ?: declaration
+            }
+            else {
+                // Otherwise report the diagnostic on the type parameter declaration
+                declaration
+            }
+
+            trace.report(BOUNDS_NOT_ALLOWED_IF_BOUNDED_BY_TYPE_PARAMETER.on(reportOn))
         }
     }
 
@@ -349,7 +373,7 @@ class DeclarationsChecker(
             }
             val typeParameterDescriptor = trace.get(TYPE_PARAMETER, typeParameter) ?: continue
             checkSupertypesForConsistency(typeParameterDescriptor, typeParameter)
-            checkOnlyOneTypeParameterBound(typeParameterDescriptor, typeParameter)
+            checkOnlyOneTypeParameterBound(typeParameterDescriptor, typeParameter, typeParameterListOwner)
         }
     }
 
diff --git a/compiler/testData/diagnostics/tests/generics/TypeParametersInTypeParameterBounds.kt b/compiler/testData/diagnostics/tests/generics/TypeParametersInTypeParameterBounds.kt
index d823ffc3e61..64c747bb07d 100644
--- a/compiler/testData/diagnostics/tests/generics/TypeParametersInTypeParameterBounds.kt
+++ b/compiler/testData/diagnostics/tests/generics/TypeParametersInTypeParameterBounds.kt
@@ -3,9 +3,10 @@ interface I2
 open class C
 
 interface A1<K, V> where V : K, V : <!REPEATED_BOUND!>K<!>
-interface A2<K, V, <!BOUNDS_NOT_ALLOWED_IF_BOUNDED_BY_TYPE_PARAMETER!>W<!>> where W : K, W : V
+interface A2<K, V, W> where W : K, W : <!BOUNDS_NOT_ALLOWED_IF_BOUNDED_BY_TYPE_PARAMETER!>V<!>
 interface A3<K, <!BOUNDS_NOT_ALLOWED_IF_BOUNDED_BY_TYPE_PARAMETER!>V<!>> where V : I1, V : K, V : I2
 interface A4<<!BOUNDS_NOT_ALLOWED_IF_BOUNDED_BY_TYPE_PARAMETER!>K<!>, V> where K : I1, K : I2, K : C, K : V, V : I2, V : I1
 
 fun <K, V> f1() where V : K, V : <!REPEATED_BOUND!>K<!> {}
-fun <K, V, <!BOUNDS_NOT_ALLOWED_IF_BOUNDED_BY_TYPE_PARAMETER!>W<!>> f2() where W : K, W : V {}
+fun <K, V, W> f2() where W : K, W : <!BOUNDS_NOT_ALLOWED_IF_BOUNDED_BY_TYPE_PARAMETER!>V<!> {}
+fun <K, V, <!BOUNDS_NOT_ALLOWED_IF_BOUNDED_BY_TYPE_PARAMETER!>W<!>> f3() where W : K, W : V, W : Any {}
diff --git a/compiler/testData/diagnostics/tests/generics/TypeParametersInTypeParameterBounds.txt b/compiler/testData/diagnostics/tests/generics/TypeParametersInTypeParameterBounds.txt
index 3d3fa582646..a8da4e7def3 100644
--- a/compiler/testData/diagnostics/tests/generics/TypeParametersInTypeParameterBounds.txt
+++ b/compiler/testData/diagnostics/tests/generics/TypeParametersInTypeParameterBounds.txt
@@ -2,6 +2,7 @@ package
 
 public fun </*0*/ K, /*1*/ V : K> f1(): kotlin.Unit where V : K
 public fun </*0*/ K, /*1*/ V, /*2*/ W : K> f2(): kotlin.Unit where W : V
+public fun </*0*/ K, /*1*/ V, /*2*/ W : K> f3(): kotlin.Unit where W : V, W : kotlin.Any
 
 public interface A1</*0*/ K, /*1*/ V : K> where V : K {
     public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean