diff --git a/compiler/frontend/src/org/jetbrains/jet/lang/diagnostics/Errors.java b/compiler/frontend/src/org/jetbrains/jet/lang/diagnostics/Errors.java
index ed4de016321..512286da2ea 100644
--- a/compiler/frontend/src/org/jetbrains/jet/lang/diagnostics/Errors.java
+++ b/compiler/frontend/src/org/jetbrains/jet/lang/diagnostics/Errors.java
@@ -115,6 +115,7 @@ public interface Errors {
     DiagnosticFactory1<JetAnnotationEntry, String> NOT_AN_ANNOTATION_CLASS = DiagnosticFactory1.create(ERROR);
     DiagnosticFactory0<PsiElement> ANNOTATION_CLASS_WITH_BODY = DiagnosticFactory0.create(ERROR);
     DiagnosticFactory0<JetTypeReference> INVALID_TYPE_OF_ANNOTATION_MEMBER = DiagnosticFactory0.create(ERROR);
+    DiagnosticFactory0<JetTypeReference> NULLABLE_TYPE_OF_ANNOTATION_MEMBER = DiagnosticFactory0.create(ERROR);
 
     // Classes and traits
 
diff --git a/compiler/frontend/src/org/jetbrains/jet/lang/diagnostics/rendering/DefaultErrorMessages.java b/compiler/frontend/src/org/jetbrains/jet/lang/diagnostics/rendering/DefaultErrorMessages.java
index b578856dff6..f3124bddb83 100644
--- a/compiler/frontend/src/org/jetbrains/jet/lang/diagnostics/rendering/DefaultErrorMessages.java
+++ b/compiler/frontend/src/org/jetbrains/jet/lang/diagnostics/rendering/DefaultErrorMessages.java
@@ -435,6 +435,7 @@ public class DefaultErrorMessages {
         MAP.put(NOT_AN_ANNOTATION_CLASS, "''{0}'' is not an annotation class", TO_STRING);
         MAP.put(ANNOTATION_CLASS_WITH_BODY, "Body is not allowed for annotation class");
         MAP.put(INVALID_TYPE_OF_ANNOTATION_MEMBER, "Invalid type of annotation member");
+        MAP.put(NULLABLE_TYPE_OF_ANNOTATION_MEMBER, "An annotation parameter cannot be nullable");
 
         MAP.put(DEFAULT_VALUE_NOT_ALLOWED_IN_OVERRIDE, "An overriding function is not allowed to specify default values for its parameters");
 
diff --git a/compiler/frontend/src/org/jetbrains/jet/lang/resolve/AnnotationUtils.java b/compiler/frontend/src/org/jetbrains/jet/lang/resolve/AnnotationUtils.java
index 947f0a498f2..8c298ec0284 100644
--- a/compiler/frontend/src/org/jetbrains/jet/lang/resolve/AnnotationUtils.java
+++ b/compiler/frontend/src/org/jetbrains/jet/lang/resolve/AnnotationUtils.java
@@ -31,6 +31,7 @@ import org.jetbrains.jet.lang.types.lang.KotlinBuiltIns;
 import java.util.List;
 
 import static org.jetbrains.jet.lang.diagnostics.Errors.INVALID_TYPE_OF_ANNOTATION_MEMBER;
+import static org.jetbrains.jet.lang.diagnostics.Errors.NULLABLE_TYPE_OF_ANNOTATION_MEMBER;
 import static org.jetbrains.jet.lang.resolve.BindingContext.VALUE_PARAMETER;
 import static org.jetbrains.jet.lang.resolve.DescriptorUtils.isAnnotationClass;
 import static org.jetbrains.jet.lang.resolve.DescriptorUtils.isEnumClass;
@@ -42,9 +43,12 @@ public class AnnotationUtils {
             VariableDescriptor parameterDescriptor = trace.getBindingContext().get(VALUE_PARAMETER, parameter);
             if (parameterDescriptor == null) continue;
             JetType parameterType = parameterDescriptor.getType();
-            if (!isAcceptableTypeForAnnotationParameter(parameterType)) {
-                JetTypeReference typeReference = parameter.getTypeReference();
-                if (typeReference != null) {
+            JetTypeReference typeReference = parameter.getTypeReference();
+            if (typeReference != null) {
+                if (parameterType.isNullable()) {
+                    trace.report(NULLABLE_TYPE_OF_ANNOTATION_MEMBER.on(typeReference));
+                }
+                else if (!isAcceptableTypeForAnnotationParameter(parameterType)) {
                     trace.report(INVALID_TYPE_OF_ANNOTATION_MEMBER.on(typeReference));
                 }
             }
@@ -52,9 +56,6 @@ public class AnnotationUtils {
     }
 
     private static boolean isAcceptableTypeForAnnotationParameter(@NotNull JetType parameterType) {
-        if (parameterType.isNullable()) {
-            return false;
-        }
         ClassDescriptor typeDescriptor = TypeUtils.getClassDescriptor(parameterType);
         if (typeDescriptor == null) {
             return false;
diff --git a/compiler/testData/diagnostics/tests/annotations/invalidTypesInAnnotationConstructor.kt b/compiler/testData/diagnostics/tests/annotations/invalidTypesInAnnotationConstructor.kt
index 0f3c448614e..2abd3811cac 100644
--- a/compiler/testData/diagnostics/tests/annotations/invalidTypesInAnnotationConstructor.kt
+++ b/compiler/testData/diagnostics/tests/annotations/invalidTypesInAnnotationConstructor.kt
@@ -40,19 +40,19 @@ annotation class Ann9(vararg val p1: String,
                       vararg val p5: Int)
 
 // INCORRECT
-annotation class InAnn1(val p1: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Int?<!>,
-                        val p3: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Short?<!>,
-                        val p4: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Long?<!>,
-                        val p5: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Double?<!>,
-                        val p6: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Float?<!>,
-                        val p7: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Char?<!>,
-                        val p8: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Boolean?<!>)
+annotation class InAnn1(val p1: <!NULLABLE_TYPE_OF_ANNOTATION_MEMBER!>Int?<!>,
+                        val p3: <!NULLABLE_TYPE_OF_ANNOTATION_MEMBER!>Short?<!>,
+                        val p4: <!NULLABLE_TYPE_OF_ANNOTATION_MEMBER!>Long?<!>,
+                        val p5: <!NULLABLE_TYPE_OF_ANNOTATION_MEMBER!>Double?<!>,
+                        val p6: <!NULLABLE_TYPE_OF_ANNOTATION_MEMBER!>Float?<!>,
+                        val p7: <!NULLABLE_TYPE_OF_ANNOTATION_MEMBER!>Char?<!>,
+                        val p8: <!NULLABLE_TYPE_OF_ANNOTATION_MEMBER!>Boolean?<!>)
 
 annotation class InAnn4(val p1: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Array<Int><!>,
-                        val p2: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Array<Int>?<!>)
+                        val p2: <!NULLABLE_TYPE_OF_ANNOTATION_MEMBER!>Array<Int>?<!>)
 
-annotation class InAnn6(val p:  <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Class<*>?<!>)
-annotation class InAnn7(val p:  <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>RetentionPolicy?<!>)
+annotation class InAnn6(val p:  <!NULLABLE_TYPE_OF_ANNOTATION_MEMBER!>Class<*>?<!>)
+annotation class InAnn7(val p:  <!NULLABLE_TYPE_OF_ANNOTATION_MEMBER!>RetentionPolicy?<!>)
 annotation class InAnn8(val p1: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Array<Int><!>,
                         val p2: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Array<Int?><!>,
                         val p3: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Array<MyClass><!>,
@@ -60,9 +60,9 @@ annotation class InAnn8(val p1: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Array<Int><
 
 annotation class InAnn9(val p: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>MyClass<!>)
 
-annotation class InAnn10(val p1: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>String?<!>)
-annotation class InAnn11(val p1: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>Ann1?<!>)
-annotation class InAnn12(val p1: <!INVALID_TYPE_OF_ANNOTATION_MEMBER!>MyEnum?<!>)
+annotation class InAnn10(val p1: <!NULLABLE_TYPE_OF_ANNOTATION_MEMBER!>String?<!>)
+annotation class InAnn11(val p1: <!NULLABLE_TYPE_OF_ANNOTATION_MEMBER!>Ann1?<!>)
+annotation class InAnn12(val p1: <!NULLABLE_TYPE_OF_ANNOTATION_MEMBER!>MyEnum?<!>)
 
 
 enum class MyEnum {