diff --git a/compiler/fir/analysis-tests/tests-gen/org/jetbrains/kotlin/test/runners/FirOldFrontendDiagnosticsTestGenerated.java b/compiler/fir/analysis-tests/tests-gen/org/jetbrains/kotlin/test/runners/FirOldFrontendDiagnosticsTestGenerated.java
index e8de7662044..cbd97ba5526 100644
--- a/compiler/fir/analysis-tests/tests-gen/org/jetbrains/kotlin/test/runners/FirOldFrontendDiagnosticsTestGenerated.java
+++ b/compiler/fir/analysis-tests/tests-gen/org/jetbrains/kotlin/test/runners/FirOldFrontendDiagnosticsTestGenerated.java
@@ -21142,6 +21142,18 @@ public class FirOldFrontendDiagnosticsTestGenerated extends AbstractFirDiagnosti
                     runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/arrays.kt");
                 }
 
+                @Test
+                @TestMetadata("dontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive.kt")
+                public void testDontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive() throws Exception {
+                    runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive.kt");
+                }
+
+                @Test
+                @TestMetadata("dontSubstituteAnotherErasedTypeArgumentIfRecursive.kt")
+                public void testDontSubstituteAnotherErasedTypeArgumentIfRecursive() throws Exception {
+                    runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedTypeArgumentIfRecursive.kt");
+                }
+
                 @Test
                 @TestMetadata("errorType.kt")
                 public void testErrorType() throws Exception {
@@ -21232,6 +21244,30 @@ public class FirOldFrontendDiagnosticsTestGenerated extends AbstractFirDiagnosti
                     runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/starProjectionToRaw.kt");
                 }
 
+                @Test
+                @TestMetadata("substituteAnotherErasedTypeArgument.kt")
+                public void testSubstituteAnotherErasedTypeArgument() throws Exception {
+                    runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteAnotherErasedTypeArgument.kt");
+                }
+
+                @Test
+                @TestMetadata("substituteOtherErasedDeepTypeArguments.kt")
+                public void testSubstituteOtherErasedDeepTypeArguments() throws Exception {
+                    runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteOtherErasedDeepTypeArguments.kt");
+                }
+
+                @Test
+                @TestMetadata("substituteSeveralOtherErasedDependentTypeArguments.kt")
+                public void testSubstituteSeveralOtherErasedDependentTypeArguments() throws Exception {
+                    runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedDependentTypeArguments.kt");
+                }
+
+                @Test
+                @TestMetadata("substituteSeveralOtherErasedTypeArguments.kt")
+                public void testSubstituteSeveralOtherErasedTypeArguments() throws Exception {
+                    runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedTypeArguments.kt");
+                }
+
                 @Test
                 @TestMetadata("typeEnhancement.kt")
                 public void testTypeEnhancement() throws Exception {
diff --git a/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/types/ConeTypeContext.kt b/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/types/ConeTypeContext.kt
index 9a357cf3dbc..383568ff183 100644
--- a/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/types/ConeTypeContext.kt
+++ b/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/types/ConeTypeContext.kt
@@ -285,7 +285,7 @@ interface ConeTypeContext : TypeSystemContext, TypeSystemOptimizationContext, Ty
         return this
     }
 
-    override fun TypeParameterMarker.doesFormSelfType(selfConstructor: TypeConstructorMarker): Boolean {
+    override fun TypeParameterMarker.hasRecursiveBounds(selfConstructor: TypeConstructorMarker): Boolean {
         require(this is ConeTypeParameterLookupTag)
         return this.typeParameterSymbol.fir.bounds.any { typeRef ->
             typeRef.coneType.contains { it.typeConstructor() == this.getTypeConstructor() }
diff --git a/compiler/ir/ir.tree/src/org/jetbrains/kotlin/ir/types/IrTypeSystemContext.kt b/compiler/ir/ir.tree/src/org/jetbrains/kotlin/ir/types/IrTypeSystemContext.kt
index 6a699a8e8e5..1329c8d1400 100644
--- a/compiler/ir/ir.tree/src/org/jetbrains/kotlin/ir/types/IrTypeSystemContext.kt
+++ b/compiler/ir/ir.tree/src/org/jetbrains/kotlin/ir/types/IrTypeSystemContext.kt
@@ -183,7 +183,7 @@ interface IrTypeSystemContext : TypeSystemContext, TypeSystemCommonSuperTypesCon
         return false
     }
 
-    override fun TypeParameterMarker.doesFormSelfType(selfConstructor: TypeConstructorMarker): Boolean {
+    override fun TypeParameterMarker.hasRecursiveBounds(selfConstructor: TypeConstructorMarker): Boolean {
         for (i in 0 until this.upperBoundCount()) {
             val upperBound = this.getUpperBound(i)
             if (upperBound.containsTypeConstructor(selfConstructor) && upperBound.typeConstructor() == selfConstructor) {
diff --git a/compiler/testData/diagnostics/tests/inference/constraints/constraintFromVariantTypeWithNestedProjection.kt b/compiler/testData/diagnostics/tests/inference/constraints/constraintFromVariantTypeWithNestedProjection.kt
index 74bc67a8203..977e6d5af5b 100644
--- a/compiler/testData/diagnostics/tests/inference/constraints/constraintFromVariantTypeWithNestedProjection.kt
+++ b/compiler/testData/diagnostics/tests/inference/constraints/constraintFromVariantTypeWithNestedProjection.kt
@@ -12,5 +12,5 @@ fun <R> choose3(c: Inv<Inv<R>>) {}
 fun f(o: Out<Out<*>>, i: In<In<*>>, inv: Inv<Inv<*>>) {
     choose1(o)
     <!NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER{NI}, TYPE_INFERENCE_NO_INFORMATION_FOR_PARAMETER{OI}!>choose2<!>(i)
-    <!TYPE_INFERENCE_PARAMETER_CONSTRAINT_ERROR{OI}!>choose3<!>(<!TYPE_MISMATCH{NI}!>inv<!>)
+    <!NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER{OI}, TYPE_INFERENCE_PARAMETER_CONSTRAINT_ERROR{OI}!>choose3<!>(<!TYPE_MISMATCH!>inv<!>)
 }
diff --git a/compiler/testData/diagnostics/tests/inference/constraints/manyConstraintsDueToFlexibleRawTypes.kt b/compiler/testData/diagnostics/tests/inference/constraints/manyConstraintsDueToFlexibleRawTypes.kt
index 4d40c9a77eb..d19f12d2a13 100644
--- a/compiler/testData/diagnostics/tests/inference/constraints/manyConstraintsDueToFlexibleRawTypes.kt
+++ b/compiler/testData/diagnostics/tests/inference/constraints/manyConstraintsDueToFlexibleRawTypes.kt
@@ -28,5 +28,5 @@ abstract class MySettingsListener<S extends MyComparableSettings> {}
 fun test() {
     val a = MySettings.getSettings()
     a.getLinkedProjectsSettings()
-    a.<!DEBUG_INFO_ELEMENT_WITH_ERROR_TYPE{OI}, TYPE_INFERENCE_UPPER_BOUND_VIOLATED{OI}, UNRESOLVED_REFERENCE_WRONG_RECEIVER{NI}!>linkedProjectsSettings<!>
+    a.<!DEBUG_INFO_ELEMENT_WITH_ERROR_TYPE{OI}, TYPE_INFERENCE_UPPER_BOUND_VIOLATED{OI}!>linkedProjectsSettings<!>
 }
diff --git a/compiler/testData/diagnostics/tests/inference/constraints/manyConstraintsDueToFlexibleRawTypes.txt b/compiler/testData/diagnostics/tests/inference/constraints/manyConstraintsDueToFlexibleRawTypes.txt
index 63b05890938..babfe4e89f8 100644
--- a/compiler/testData/diagnostics/tests/inference/constraints/manyConstraintsDueToFlexibleRawTypes.txt
+++ b/compiler/testData/diagnostics/tests/inference/constraints/manyConstraintsDueToFlexibleRawTypes.txt
@@ -10,5 +10,5 @@ public open class MySettings</*0*/ SS : MySettings<SS!, PS!, L!>!, /*1*/ PS : My
     public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
 
     // Static members
-    public open fun getSettings(): MySettings<(raw) MySettings<*, *, *>!, (raw) MyComparableSettings!, (raw) MySettingsListener<*>!>!
+    public open fun getSettings(): (MySettings<(raw) *, (raw) MyComparableSettings!, (raw) MySettingsListener<MyComparableSettings!>!>..MySettings<*, *, out MySettingsListener<*>!>?)
 }
diff --git a/compiler/testData/diagnostics/tests/j+k/kt1431.txt b/compiler/testData/diagnostics/tests/j+k/kt1431.txt
index c3054d1ab26..1a660d30ada 100644
--- a/compiler/testData/diagnostics/tests/j+k/kt1431.txt
+++ b/compiler/testData/diagnostics/tests/j+k/kt1431.txt
@@ -5,7 +5,7 @@ package a {
     public open class C</*0*/ B : a.C<B!>!> {
         public constructor C</*0*/ B : a.C<B!>!>()
         public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
-        public open fun foo(): a.C<(raw) a.C<*>!>!
+        public open fun foo(): a.C<(raw) *>!
         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/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive.fir.kt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive.fir.kt
new file mode 100644
index 00000000000..17f89b06a6e
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive.fir.kt
@@ -0,0 +1,26 @@
+// WITH_RUNTIME
+// FULL_JDK
+
+// FILE: X.java
+class X<B extends I<P, B>, P> {
+    static final E<X> E = new E<>();
+
+    String getId() {
+        return null;
+    }
+}
+
+class E<T> {
+    T getT() {
+        return null;
+    }
+}
+
+interface I<P, L> {}
+
+// FILE: test.kt
+fun test() {
+    val t = X.E.<!UNRESOLVED_REFERENCE!>t<!>
+    t
+    t.<!UNRESOLVED_REFERENCE!>id<!> // should be OK
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive.kt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive.kt
new file mode 100644
index 00000000000..9fbe2c5b137
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive.kt
@@ -0,0 +1,26 @@
+// WITH_RUNTIME
+// FULL_JDK
+
+// FILE: X.java
+class X<B extends I<P, B>, P> {
+    static final E<X> E = new E<>();
+
+    String getId() {
+        return null;
+    }
+}
+
+class E<T> {
+    T getT() {
+        return null;
+    }
+}
+
+interface I<P, L> {}
+
+// FILE: test.kt
+fun test() {
+    val t = X.E.t
+    <!DEBUG_INFO_EXPRESSION_TYPE("(X<*, (kotlin.Any..kotlin.Any?)>..X<*, *>?)")!>t<!>
+    t.id // should be OK
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive.txt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive.txt
new file mode 100644
index 00000000000..ef8ac4d3443
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive.txt
@@ -0,0 +1,14 @@
+package
+
+public fun test(): kotlin.Unit
+
+public/*package*/ open class X</*0*/ B : I<P!, B!>!, /*1*/ P : kotlin.Any!> {
+    public/*package*/ constructor X</*0*/ B : I<P!, B!>!, /*1*/ P : kotlin.Any!>()
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public/*package*/ open fun getId(): kotlin.String!
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+
+    // Static members
+    public/*package*/ final val E: E<X<(raw) *, (raw) kotlin.Any!>!>!
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedTypeArgumentIfRecursive.fir.kt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedTypeArgumentIfRecursive.fir.kt
new file mode 100644
index 00000000000..0bc39e05135
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedTypeArgumentIfRecursive.fir.kt
@@ -0,0 +1,26 @@
+// WITH_RUNTIME
+// FULL_JDK
+
+// FILE: X.java
+class X<B extends I<B>> {
+    static final E<X> E = new E<>();
+
+    String getId() {
+        return null;
+    }
+}
+
+class E<T> {
+    T getT() {
+        return null;
+    }
+}
+
+interface I<P> {}
+
+// FILE: test.kt
+fun test() {
+    val t = X.E.<!UNRESOLVED_REFERENCE!>t<!>
+    t
+    t.<!UNRESOLVED_REFERENCE!>id<!> // should be OK
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedTypeArgumentIfRecursive.kt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedTypeArgumentIfRecursive.kt
new file mode 100644
index 00000000000..07f1973de18
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedTypeArgumentIfRecursive.kt
@@ -0,0 +1,26 @@
+// WITH_RUNTIME
+// FULL_JDK
+
+// FILE: X.java
+class X<B extends I<B>> {
+    static final E<X> E = new E<>();
+
+    String getId() {
+        return null;
+    }
+}
+
+class E<T> {
+    T getT() {
+        return null;
+    }
+}
+
+interface I<P> {}
+
+// FILE: test.kt
+fun test() {
+    val t = X.E.t
+    <!DEBUG_INFO_EXPRESSION_TYPE("(X<*>..X<*>?)")!>t<!>
+    t.id // should be OK
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedTypeArgumentIfRecursive.txt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedTypeArgumentIfRecursive.txt
new file mode 100644
index 00000000000..537039a51be
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedTypeArgumentIfRecursive.txt
@@ -0,0 +1,14 @@
+package
+
+public fun test(): kotlin.Unit
+
+public/*package*/ open class X</*0*/ B : I<B!>!> {
+    public/*package*/ constructor X</*0*/ B : I<B!>!>()
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public/*package*/ open fun getId(): kotlin.String!
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+
+    // Static members
+    public/*package*/ final val E: E<X<(raw) *>!>!
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteAnotherErasedTypeArgument.fir.kt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteAnotherErasedTypeArgument.fir.kt
new file mode 100644
index 00000000000..06bf7d09d0e
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteAnotherErasedTypeArgument.fir.kt
@@ -0,0 +1,26 @@
+// WITH_RUNTIME
+// FULL_JDK
+
+// FILE: X.java
+class X<B extends I<P>, P> {
+    static final E<X> E = new E<>();
+
+    String getId() {
+        return null;
+    }
+}
+
+class E<T> {
+    T getT() {
+        return null;
+    }
+}
+
+interface I<P> {}
+
+// FILE: test.kt
+fun test() {
+    val t = X.E.<!UNRESOLVED_REFERENCE!>t<!>
+    t
+    t.<!UNRESOLVED_REFERENCE!>id<!> // should be OK
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteAnotherErasedTypeArgument.kt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteAnotherErasedTypeArgument.kt
new file mode 100644
index 00000000000..8ad2675e928
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteAnotherErasedTypeArgument.kt
@@ -0,0 +1,26 @@
+// WITH_RUNTIME
+// FULL_JDK
+
+// FILE: X.java
+class X<B extends I<P>, P> {
+    static final E<X> E = new E<>();
+
+    String getId() {
+        return null;
+    }
+}
+
+class E<T> {
+    T getT() {
+        return null;
+    }
+}
+
+interface I<P> {}
+
+// FILE: test.kt
+fun test() {
+    val t = X.E.t
+    <!DEBUG_INFO_EXPRESSION_TYPE("(X<(I<(kotlin.Any..kotlin.Any?)>..I<(kotlin.Any..kotlin.Any?)>?), (kotlin.Any..kotlin.Any?)>..X<out (I<*>..I<*>?), *>?)")!>t<!>
+    t.id // should be OK
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteAnotherErasedTypeArgument.txt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteAnotherErasedTypeArgument.txt
new file mode 100644
index 00000000000..82b76d2a427
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteAnotherErasedTypeArgument.txt
@@ -0,0 +1,14 @@
+package
+
+public fun test(): kotlin.Unit
+
+public/*package*/ open class X</*0*/ B : I<P!>!, /*1*/ P : kotlin.Any!> {
+    public/*package*/ constructor X</*0*/ B : I<P!>!, /*1*/ P : kotlin.Any!>()
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public/*package*/ open fun getId(): kotlin.String!
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+
+    // Static members
+    public/*package*/ final val E: E<(X<(raw) I<kotlin.Any!>!, (raw) kotlin.Any!>..X<out I<*>!, *>?)>!
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteOtherErasedDeepTypeArguments.fir.kt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteOtherErasedDeepTypeArguments.fir.kt
new file mode 100644
index 00000000000..cf5a6a0296c
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteOtherErasedDeepTypeArguments.fir.kt
@@ -0,0 +1,27 @@
+// WITH_RUNTIME
+// FULL_JDK
+
+// FILE: X.java
+class X<B extends I1<P, P, P>, P, A extends I1<I2<B>, B, I1<P, I2<B>, P>>> {
+    static final E<X> E = new E<>();
+
+    String getId() {
+        return null;
+    }
+}
+
+class E<T> {
+    T getT() {
+        return null;
+    }
+}
+
+interface I1<P, A, F> {}
+interface I2<S> {}
+
+// FILE: test.kt
+fun test() {
+    val t = X.E.<!UNRESOLVED_REFERENCE!>t<!>
+    t
+    t.<!UNRESOLVED_REFERENCE!>id<!> // error before
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteOtherErasedDeepTypeArguments.kt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteOtherErasedDeepTypeArguments.kt
new file mode 100644
index 00000000000..107e5a35083
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteOtherErasedDeepTypeArguments.kt
@@ -0,0 +1,27 @@
+// WITH_RUNTIME
+// FULL_JDK
+
+// FILE: X.java
+class X<B extends I1<P, P, P>, P, A extends I1<I2<B>, B, I1<P, I2<B>, P>>> {
+    static final E<X> E = new E<>();
+
+    String getId() {
+        return null;
+    }
+}
+
+class E<T> {
+    T getT() {
+        return null;
+    }
+}
+
+interface I1<P, A, F> {}
+interface I2<S> {}
+
+// FILE: test.kt
+fun test() {
+    val t = X.E.t
+    <!DEBUG_INFO_EXPRESSION_TYPE("(X<(I1<(kotlin.Any..kotlin.Any?), (kotlin.Any..kotlin.Any?), (kotlin.Any..kotlin.Any?)>..I1<(kotlin.Any..kotlin.Any?), (kotlin.Any..kotlin.Any?), (kotlin.Any..kotlin.Any?)>?), (kotlin.Any..kotlin.Any?), (I1<*, (I1<(kotlin.Any..kotlin.Any?), (kotlin.Any..kotlin.Any?), (kotlin.Any..kotlin.Any?)>..I1<(kotlin.Any..kotlin.Any?), (kotlin.Any..kotlin.Any?), (kotlin.Any..kotlin.Any?)>?), *>..I1<*, (I1<(kotlin.Any..kotlin.Any?), (kotlin.Any..kotlin.Any?), (kotlin.Any..kotlin.Any?)>..I1<(kotlin.Any..kotlin.Any?), (kotlin.Any..kotlin.Any?), (kotlin.Any..kotlin.Any?)>?), *>?)>..X<out (I1<*, *, *>..I1<*, *, *>?), *, out (I1<*, out (I1<*, *, *>..I1<*, *, *>?), *>..I1<*, out (I1<*, *, *>..I1<*, *, *>?), *>?)>?)")!>t<!>
+    t.<!UNRESOLVED_REFERENCE_WRONG_RECEIVER!>id<!> // error before
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteOtherErasedDeepTypeArguments.txt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteOtherErasedDeepTypeArguments.txt
new file mode 100644
index 00000000000..73dc0666326
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteOtherErasedDeepTypeArguments.txt
@@ -0,0 +1,14 @@
+package
+
+public fun test(): kotlin.Unit
+
+public/*package*/ open class X</*0*/ B : I1<P!, P!, P!>!, /*1*/ P : kotlin.Any!, /*2*/ A : I1<I2<B!>!, B!, I1<P!, I2<B!>!, P!>!>!> {
+    public/*package*/ constructor X</*0*/ B : I1<P!, P!, P!>!, /*1*/ P : kotlin.Any!, /*2*/ A : I1<I2<B!>!, B!, I1<P!, I2<B!>!, P!>!>!>()
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public/*package*/ open fun getId(): kotlin.String!
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+
+    // Static members
+    public/*package*/ final val E: E<(X<(raw) I1<kotlin.Any!, kotlin.Any!, kotlin.Any!>!, (raw) kotlin.Any!, (raw) I1<*, I1<kotlin.Any!, kotlin.Any!, kotlin.Any!>!, *>!>..X<out I1<*, *, *>!, *, out I1<*, out I1<*, *, *>!, *>!>?)>!
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedDependentTypeArguments.fir.kt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedDependentTypeArguments.fir.kt
new file mode 100644
index 00000000000..99d560600eb
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedDependentTypeArguments.fir.kt
@@ -0,0 +1,26 @@
+// WITH_RUNTIME
+// FULL_JDK
+
+// FILE: X.java
+class X<B extends I<P>, P, A extends I<B>> {
+    static final E<X> E = new E<>();
+
+    String getId() {
+        return null;
+    }
+}
+
+class E<T> {
+    T getT() {
+        return null;
+    }
+}
+
+interface I<P> {}
+
+// FILE: test.kt
+fun test() {
+    val t = X.E.<!UNRESOLVED_REFERENCE!>t<!>
+    t
+    t.<!UNRESOLVED_REFERENCE!>id<!> // should be OK
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedDependentTypeArguments.kt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedDependentTypeArguments.kt
new file mode 100644
index 00000000000..a750670d2e6
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedDependentTypeArguments.kt
@@ -0,0 +1,26 @@
+// WITH_RUNTIME
+// FULL_JDK
+
+// FILE: X.java
+class X<B extends I<P>, P, A extends I<B>> {
+    static final E<X> E = new E<>();
+
+    String getId() {
+        return null;
+    }
+}
+
+class E<T> {
+    T getT() {
+        return null;
+    }
+}
+
+interface I<P> {}
+
+// FILE: test.kt
+fun test() {
+    val t = X.E.t
+    <!DEBUG_INFO_EXPRESSION_TYPE("(X<(I<(kotlin.Any..kotlin.Any?)>..I<(kotlin.Any..kotlin.Any?)>?), (kotlin.Any..kotlin.Any?), (I<(I<(kotlin.Any..kotlin.Any?)>..I<(kotlin.Any..kotlin.Any?)>?)>..I<(I<(kotlin.Any..kotlin.Any?)>..I<(kotlin.Any..kotlin.Any?)>?)>?)>..X<out (I<*>..I<*>?), *, out (I<out (I<*>..I<*>?)>..I<out (I<*>..I<*>?)>?)>?)")!>t<!>
+    t.id // should be OK
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedDependentTypeArguments.txt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedDependentTypeArguments.txt
new file mode 100644
index 00000000000..6f6afa643c6
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedDependentTypeArguments.txt
@@ -0,0 +1,14 @@
+package
+
+public fun test(): kotlin.Unit
+
+public/*package*/ open class X</*0*/ B : I<P!>!, /*1*/ P : kotlin.Any!, /*2*/ A : I<B!>!> {
+    public/*package*/ constructor X</*0*/ B : I<P!>!, /*1*/ P : kotlin.Any!, /*2*/ A : I<B!>!>()
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public/*package*/ open fun getId(): kotlin.String!
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+
+    // Static members
+    public/*package*/ final val E: E<(X<(raw) I<kotlin.Any!>!, (raw) kotlin.Any!, (raw) I<I<kotlin.Any!>!>!>..X<out I<*>!, *, out I<out I<*>!>!>?)>!
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedTypeArguments.fir.kt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedTypeArguments.fir.kt
new file mode 100644
index 00000000000..1f949aec856
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedTypeArguments.fir.kt
@@ -0,0 +1,26 @@
+// WITH_RUNTIME
+// FULL_JDK
+
+// FILE: X.java
+class X<B extends I<P>, P, A extends I<P>> {
+    static final E<X> E = new E<>();
+
+    String getId() {
+        return null;
+    }
+}
+
+class E<T> {
+    T getT() {
+        return null;
+    }
+}
+
+interface I<P> {}
+
+// FILE: test.kt
+fun test() {
+    val t = X.E.<!UNRESOLVED_REFERENCE!>t<!>
+    t
+    t.<!UNRESOLVED_REFERENCE!>id<!> // should be OK
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedTypeArguments.kt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedTypeArguments.kt
new file mode 100644
index 00000000000..5e7857a9bc7
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedTypeArguments.kt
@@ -0,0 +1,26 @@
+// WITH_RUNTIME
+// FULL_JDK
+
+// FILE: X.java
+class X<B extends I<P>, P, A extends I<P>> {
+    static final E<X> E = new E<>();
+
+    String getId() {
+        return null;
+    }
+}
+
+class E<T> {
+    T getT() {
+        return null;
+    }
+}
+
+interface I<P> {}
+
+// FILE: test.kt
+fun test() {
+    val t = X.E.t
+    <!DEBUG_INFO_EXPRESSION_TYPE("(X<(I<(kotlin.Any..kotlin.Any?)>..I<(kotlin.Any..kotlin.Any?)>?), (kotlin.Any..kotlin.Any?), (I<(kotlin.Any..kotlin.Any?)>..I<(kotlin.Any..kotlin.Any?)>?)>..X<out (I<*>..I<*>?), *, out (I<*>..I<*>?)>?)")!>t<!>
+    t.id // should be OK
+}
diff --git a/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedTypeArguments.txt b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedTypeArguments.txt
new file mode 100644
index 00000000000..10fb27fb8d7
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedTypeArguments.txt
@@ -0,0 +1,14 @@
+package
+
+public fun test(): kotlin.Unit
+
+public/*package*/ open class X</*0*/ B : I<P!>!, /*1*/ P : kotlin.Any!, /*2*/ A : I<P!>!> {
+    public/*package*/ constructor X</*0*/ B : I<P!>!, /*1*/ P : kotlin.Any!, /*2*/ A : I<P!>!>()
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public/*package*/ open fun getId(): kotlin.String!
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+
+    // Static members
+    public/*package*/ final val E: E<(X<(raw) I<kotlin.Any!>!, (raw) kotlin.Any!, (raw) I<kotlin.Any!>!>..X<out I<*>!, *, out I<*>!>?)>!
+}
diff --git a/compiler/testData/loadJava/compiledJava/signaturePropagation/RawSuperTypeWithRecursiveBound.txt b/compiler/testData/loadJava/compiledJava/signaturePropagation/RawSuperTypeWithRecursiveBound.txt
index 71b8e985eaa..3f2722c4648 100644
--- a/compiler/testData/loadJava/compiledJava/signaturePropagation/RawSuperTypeWithRecursiveBound.txt
+++ b/compiler/testData/loadJava/compiledJava/signaturePropagation/RawSuperTypeWithRecursiveBound.txt
@@ -3,11 +3,11 @@ package test
 public open class RawSuperTypeWithRecursiveBound {
     public constructor RawSuperTypeWithRecursiveBound()
 
-    public open inner class Derived : test.RawSuperTypeWithRecursiveBound.Super<(raw) test.RawSuperTypeWithRecursiveBound.Super<*>!> {
+    public open inner class Derived : test.RawSuperTypeWithRecursiveBound.Super<(raw) *> {
         public constructor Derived()
         public open override /*1*/ fun dummy(): kotlin.Unit
         public open fun foo(/*0*/ p0: kotlin.Any!): kotlin.Unit
-        public open override /*1*/ fun foo(/*0*/ p0: test.RawSuperTypeWithRecursiveBound.Super<(raw) test.RawSuperTypeWithRecursiveBound.Super<*>!>!): kotlin.Unit
+        public open override /*1*/ fun foo(/*0*/ p0: test.RawSuperTypeWithRecursiveBound.Super<(raw) *>!): kotlin.Unit
     }
 
     public interface Super</*0*/ T : test.RawSuperTypeWithRecursiveBound.Super<T!>!> {
diff --git a/compiler/testData/loadJava/compiledJava/signaturePropagation/RawSuperTypeWithRecursiveBoundMultipleParameters.txt b/compiler/testData/loadJava/compiledJava/signaturePropagation/RawSuperTypeWithRecursiveBoundMultipleParameters.txt
index 01f328fa4fa..9123ed9580b 100644
--- a/compiler/testData/loadJava/compiledJava/signaturePropagation/RawSuperTypeWithRecursiveBoundMultipleParameters.txt
+++ b/compiler/testData/loadJava/compiledJava/signaturePropagation/RawSuperTypeWithRecursiveBoundMultipleParameters.txt
@@ -3,11 +3,11 @@ package test
 public open class RawSuperTypeWithRecursiveBoundMultipleParameters {
     public constructor RawSuperTypeWithRecursiveBoundMultipleParameters()
 
-    public open inner class Derived : test.RawSuperTypeWithRecursiveBoundMultipleParameters.Super<(raw) kotlin.Any!, (raw) test.RawSuperTypeWithRecursiveBoundMultipleParameters.Super<*, *>!> {
+    public open inner class Derived : test.RawSuperTypeWithRecursiveBoundMultipleParameters.Super<(raw) kotlin.Any!, (raw) *> {
         public constructor Derived()
         public open override /*1*/ fun dummy(): kotlin.Unit
         public open fun foo(/*0*/ p0: kotlin.Any!, /*1*/ p1: kotlin.Any!): kotlin.Unit
-        public open override /*1*/ fun foo(/*0*/ p0: kotlin.Any!, /*1*/ p1: test.RawSuperTypeWithRecursiveBoundMultipleParameters.Super<(raw) kotlin.Any!, (raw) test.RawSuperTypeWithRecursiveBoundMultipleParameters.Super<*, *>!>!): kotlin.Unit
+        public open override /*1*/ fun foo(/*0*/ p0: kotlin.Any!, /*1*/ p1: test.RawSuperTypeWithRecursiveBoundMultipleParameters.Super<(raw) kotlin.Any!, (raw) *>!): kotlin.Unit
     }
 
     public interface Super</*0*/ R : kotlin.Any!, /*1*/ T : test.RawSuperTypeWithRecursiveBoundMultipleParameters.Super<R!, T!>!> {
diff --git a/compiler/tests-common-new/tests-gen/org/jetbrains/kotlin/test/runners/DiagnosticTestGenerated.java b/compiler/tests-common-new/tests-gen/org/jetbrains/kotlin/test/runners/DiagnosticTestGenerated.java
index bf1d1644fb3..4cac783a240 100644
--- a/compiler/tests-common-new/tests-gen/org/jetbrains/kotlin/test/runners/DiagnosticTestGenerated.java
+++ b/compiler/tests-common-new/tests-gen/org/jetbrains/kotlin/test/runners/DiagnosticTestGenerated.java
@@ -21148,6 +21148,18 @@ public class DiagnosticTestGenerated extends AbstractDiagnosticTest {
                     runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/arrays.kt");
                 }
 
+                @Test
+                @TestMetadata("dontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive.kt")
+                public void testDontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive() throws Exception {
+                    runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedRecursiveTypeArgumentAndNonRecursive.kt");
+                }
+
+                @Test
+                @TestMetadata("dontSubstituteAnotherErasedTypeArgumentIfRecursive.kt")
+                public void testDontSubstituteAnotherErasedTypeArgumentIfRecursive() throws Exception {
+                    runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/dontSubstituteAnotherErasedTypeArgumentIfRecursive.kt");
+                }
+
                 @Test
                 @TestMetadata("errorType.kt")
                 public void testErrorType() throws Exception {
@@ -21238,6 +21250,30 @@ public class DiagnosticTestGenerated extends AbstractDiagnosticTest {
                     runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/starProjectionToRaw.kt");
                 }
 
+                @Test
+                @TestMetadata("substituteAnotherErasedTypeArgument.kt")
+                public void testSubstituteAnotherErasedTypeArgument() throws Exception {
+                    runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteAnotherErasedTypeArgument.kt");
+                }
+
+                @Test
+                @TestMetadata("substituteOtherErasedDeepTypeArguments.kt")
+                public void testSubstituteOtherErasedDeepTypeArguments() throws Exception {
+                    runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteOtherErasedDeepTypeArguments.kt");
+                }
+
+                @Test
+                @TestMetadata("substituteSeveralOtherErasedDependentTypeArguments.kt")
+                public void testSubstituteSeveralOtherErasedDependentTypeArguments() throws Exception {
+                    runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedDependentTypeArguments.kt");
+                }
+
+                @Test
+                @TestMetadata("substituteSeveralOtherErasedTypeArguments.kt")
+                public void testSubstituteSeveralOtherErasedTypeArguments() throws Exception {
+                    runTest("compiler/testData/diagnostics/tests/platformTypes/rawTypes/substituteSeveralOtherErasedTypeArguments.kt");
+                }
+
                 @Test
                 @TestMetadata("typeEnhancement.kt")
                 public void testTypeEnhancement() throws Exception {
diff --git a/core/compiler.common/src/org/jetbrains/kotlin/types/AbstractTypeChecker.kt b/core/compiler.common/src/org/jetbrains/kotlin/types/AbstractTypeChecker.kt
index 18edeb9aa18..f70965cc6b1 100644
--- a/core/compiler.common/src/org/jetbrains/kotlin/types/AbstractTypeChecker.kt
+++ b/core/compiler.common/src/org/jetbrains/kotlin/types/AbstractTypeChecker.kt
@@ -375,7 +375,7 @@ object AbstractTypeChecker {
 
         val typeVariableConstructor = superArgumentType.typeConstructor() as? TypeVariableTypeConstructorMarker ?: return false
 
-        return typeVariableConstructor.typeParameter?.doesFormSelfType(selfConstructor) == true
+        return typeVariableConstructor.typeParameter?.hasRecursiveBounds(selfConstructor) == true
     }
 
     fun AbstractTypeCheckerContext.isSubtypeForSameConstructor(
@@ -506,7 +506,7 @@ object AbstractTypeChecker {
         if (subType is CapturedTypeMarker) {
             val typeParameter =
                 context.typeSystemContext.getTypeParameterForArgumentInBaseIfItEqualToTarget(baseType = superType, targetType = subType)
-            if (typeParameter != null && typeParameter.doesFormSelfType(superType.typeConstructor())) {
+            if (typeParameter != null && typeParameter.hasRecursiveBounds(superType.typeConstructor())) {
                 return true
             }
         }
diff --git a/core/compiler.common/src/org/jetbrains/kotlin/types/model/TypeSystemContext.kt b/core/compiler.common/src/org/jetbrains/kotlin/types/model/TypeSystemContext.kt
index b2219dc6b2f..02dd1473c96 100644
--- a/core/compiler.common/src/org/jetbrains/kotlin/types/model/TypeSystemContext.kt
+++ b/core/compiler.common/src/org/jetbrains/kotlin/types/model/TypeSystemContext.kt
@@ -313,7 +313,7 @@ interface TypeSystemContext : TypeSystemOptimizationContext {
     fun TypeParameterMarker.upperBoundCount(): Int
     fun TypeParameterMarker.getUpperBound(index: Int): KotlinTypeMarker
     fun TypeParameterMarker.getTypeConstructor(): TypeConstructorMarker
-    fun TypeParameterMarker.doesFormSelfType(selfConstructor: TypeConstructorMarker): Boolean
+    fun TypeParameterMarker.hasRecursiveBounds(selfConstructor: TypeConstructorMarker): Boolean
 
     fun areEqualTypeConstructors(c1: TypeConstructorMarker, c2: TypeConstructorMarker): Boolean
 
diff --git a/core/descriptors.jvm/src/org/jetbrains/kotlin/load/java/lazy/types/JavaTypeResolver.kt b/core/descriptors.jvm/src/org/jetbrains/kotlin/load/java/lazy/types/JavaTypeResolver.kt
index d7c2e039958..a505681b30b 100644
--- a/core/descriptors.jvm/src/org/jetbrains/kotlin/load/java/lazy/types/JavaTypeResolver.kt
+++ b/core/descriptors.jvm/src/org/jetbrains/kotlin/load/java/lazy/types/JavaTypeResolver.kt
@@ -32,8 +32,7 @@ import org.jetbrains.kotlin.name.ClassId
 import org.jetbrains.kotlin.name.FqName
 import org.jetbrains.kotlin.types.*
 import org.jetbrains.kotlin.types.Variance.*
-import org.jetbrains.kotlin.types.typeUtil.createProjection
-import org.jetbrains.kotlin.types.typeUtil.replaceArgumentsWithStarProjections
+import org.jetbrains.kotlin.types.typeUtil.*
 import org.jetbrains.kotlin.utils.sure
 
 private val JAVA_LANG_CLASS_FQ_NAME: FqName = FqName("java.lang.Class")
@@ -210,6 +209,15 @@ class JavaTypeResolver(
         val typeParameters = constructor.parameters
         if (eraseTypeParameters) {
             return typeParameters.map { parameter ->
+                /*
+                 * We shouldn't erase recursive type parameters to avoid creating types unsatisfying upper bounds.
+                 * E.g. if we got erased raw type of `class Foo<T: Foo<T>> {}` we'd create Foo<(raw) Foo<*>!>!,
+                 * but it's wrong because Foo<*> isn't subtype of Foo<Foo<*>> in accordance with declared upper bound of Foo.
+                 * So we should create Foo<*> in this case (CapturedType(*) is really subtype of Foo<CapturedType(*)>).
+                 */
+                if (hasTypeParameterRecursiveBounds(parameter, selfConstructor = null, attr.upperBoundOfTypeParameter))
+                    return@map StarProjectionImpl(parameter)
+
                 // Some activity for preventing recursion in cases like `class A<T extends A, F extends T>`
                 //
                 // When calculating upper bound of some parameter (attr.upperBoundOfTypeParameter),
@@ -222,12 +230,11 @@ class JavaTypeResolver(
                 // - Calculating second argument for raw upper bound of T. It depends on F, that again depends on upper bound of T,
                 //   so we get A<*, *>.
                 // Summary result for upper bound of T is `A<A<*, *>, A<*, *>>..A<out A<*, *>, out A<*, *>>`
-                val erasedUpperBound =
-                    LazyWrappedType(c.storageManager) {
-                        parameter.getErasedUpperBound(attr.upperBoundOfTypeParameter) {
-                            constructor.declarationDescriptor!!.defaultType.replaceArgumentsWithStarProjections()
-                        }
+                val erasedUpperBound = LazyWrappedType(c.storageManager) {
+                    parameter.getErasedUpperBound(isRaw, attr) {
+                        constructor.declarationDescriptor!!.defaultType.replaceArgumentsWithStarProjections()
                     }
+                }
 
                 RawSubstitution.computeProjection(
                     parameter,
@@ -333,24 +340,51 @@ internal fun TypeParameterDescriptor.getErasedUpperBound(
     // Calculation of `potentiallyRecursiveTypeParameter.upperBounds` may recursively depend on `this.getErasedUpperBound`
     // E.g. `class A<T extends A, F extends A>`
     // To prevent recursive calls return defaultValue() instead
-    potentiallyRecursiveTypeParameter: TypeParameterDescriptor? = null,
+    isRaw: Boolean,
+    typeAttr: JavaTypeAttributes,
     defaultValue: (() -> KotlinType) = { ErrorUtils.createErrorType("Can't compute erased upper bound of type parameter `$this`") }
 ): KotlinType {
-    if (this === potentiallyRecursiveTypeParameter) return defaultValue()
+    if (this === typeAttr.upperBoundOfTypeParameter) return defaultValue()
+
+    /*
+     * We should do erasure of containing type parameters with their erasure to avoid creating inconsistent types.
+     * E.g. for `class Foo<T: Foo<B>, B>`, we'd have erasure for lower bound: Foo<Foo<*>, Any>,
+     * but it's wrong type: projection(*) != projection(Any).
+     * So we should substitute erasure of the corresponding type parameter: `Foo<Foo<Any>, Any>` or `Foo<Foo<*>, *>`.
+     */
+    val erasedUpperBounds = defaultType.extractTypeParametersFromUpperBounds(typeAttr.upperBoundOfTypeParameter).associate {
+        it.typeConstructor to RawSubstitution.computeProjection(
+            this,
+            // if erasure happens due to invalid arguments number, use star projections instead
+            if (isRaw) typeAttr else typeAttr.withFlexibility(INFLEXIBLE),
+            it.getErasedUpperBound(isRaw, typeAttr)
+        )
+    }
+    val erasedUpperBoundsSubstitutor = TypeSubstitutor.create(TypeConstructorSubstitution.createByConstructorsMap(erasedUpperBounds))
 
     val firstUpperBound = upperBounds.first()
 
     if (firstUpperBound.constructor.declarationDescriptor is ClassDescriptor) {
-        return firstUpperBound.replaceArgumentsWithStarProjections()
+        return firstUpperBound.replaceArgumentsWithStarProjectionOrMapped(
+            erasedUpperBoundsSubstitutor,
+            erasedUpperBounds,
+            OUT_VARIANCE,
+            typeAttr.upperBoundOfTypeParameter
+        )
     }
 
-    val stopAt = potentiallyRecursiveTypeParameter ?: this
+    val stopAt = typeAttr.upperBoundOfTypeParameter ?: this
     var current = firstUpperBound.constructor.declarationDescriptor as TypeParameterDescriptor
 
     while (current != stopAt) {
         val nextUpperBound = current.upperBounds.first()
         if (nextUpperBound.constructor.declarationDescriptor is ClassDescriptor) {
-            return nextUpperBound.replaceArgumentsWithStarProjections()
+            return nextUpperBound.replaceArgumentsWithStarProjectionOrMapped(
+                erasedUpperBoundsSubstitutor,
+                erasedUpperBounds,
+                OUT_VARIANCE,
+                typeAttr.upperBoundOfTypeParameter
+            )
         }
 
         current = nextUpperBound.constructor.declarationDescriptor as TypeParameterDescriptor
diff --git a/core/descriptors.jvm/src/org/jetbrains/kotlin/load/java/lazy/types/RawType.kt b/core/descriptors.jvm/src/org/jetbrains/kotlin/load/java/lazy/types/RawType.kt
index fd181f20209..de50a691b49 100644
--- a/core/descriptors.jvm/src/org/jetbrains/kotlin/load/java/lazy/types/RawType.kt
+++ b/core/descriptors.jvm/src/org/jetbrains/kotlin/load/java/lazy/types/RawType.kt
@@ -107,10 +107,9 @@ internal object RawSubstitution : TypeSubstitution() {
     private val lowerTypeAttr = TypeUsage.COMMON.toAttributes().withFlexibility(JavaTypeFlexibility.FLEXIBLE_LOWER_BOUND)
     private val upperTypeAttr = TypeUsage.COMMON.toAttributes().withFlexibility(JavaTypeFlexibility.FLEXIBLE_UPPER_BOUND)
 
-    private fun eraseType(type: KotlinType): KotlinType {
-        val declaration = type.constructor.declarationDescriptor
-        return when (declaration) {
-            is TypeParameterDescriptor -> eraseType(declaration.getErasedUpperBound())
+    private fun eraseType(type: KotlinType, attr: JavaTypeAttributes = JavaTypeAttributes(TypeUsage.COMMON)): KotlinType {
+        return when (val declaration = type.constructor.declarationDescriptor) {
+            is TypeParameterDescriptor -> eraseType(declaration.getErasedUpperBound(isRaw = true, attr), attr)
             is ClassDescriptor -> {
                 val declarationForUpper =
                     type.upperIfFlexible().constructor.declarationDescriptor
@@ -142,7 +141,7 @@ internal object RawSubstitution : TypeSubstitution() {
         if (KotlinBuiltIns.isArray(type)) {
             val componentTypeProjection = type.arguments[0]
             val arguments = listOf(
-                TypeProjectionImpl(componentTypeProjection.projectionKind, eraseType(componentTypeProjection.type))
+                TypeProjectionImpl(componentTypeProjection.projectionKind, eraseType(componentTypeProjection.type, attr))
             )
             return KotlinTypeFactory.simpleType(
                 type.annotations, type.constructor, arguments, type.isMarkedNullable
@@ -171,7 +170,7 @@ internal object RawSubstitution : TypeSubstitution() {
     fun computeProjection(
         parameter: TypeParameterDescriptor,
         attr: JavaTypeAttributes,
-        erasedUpperBound: KotlinType = parameter.getErasedUpperBound()
+        erasedUpperBound: KotlinType = parameter.getErasedUpperBound(isRaw = true, attr)
     ) = when (attr.flexibility) {
         // Raw(List<T>) => (List<Any?>..List<*>)
         // Raw(Enum<T>) => (Enum<Enum<*>>..Enum<out Enum<*>>)
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/TypeUtils.kt b/core/descriptors/src/org/jetbrains/kotlin/types/TypeUtils.kt
index 8990cc01e61..ed0127acce3 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/TypeUtils.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/TypeUtils.kt
@@ -185,7 +185,74 @@ fun KotlinType.contains(predicate: (UnwrappedType) -> Boolean) = TypeUtils.conta
 fun KotlinType.replaceArgumentsWithStarProjections() = replaceArgumentsWith(::StarProjectionImpl)
 fun KotlinType.replaceArgumentsWithNothing() = replaceArgumentsWith { it.builtIns.nothingType.asTypeProjection() }
 
-private inline fun KotlinType.replaceArgumentsWith(replacement: (TypeParameterDescriptor) -> TypeProjection): KotlinType {
+fun KotlinType.extractTypeParametersFromUpperBounds(upperBoundOfTypeParameter: TypeParameterDescriptor?): Set<TypeParameterDescriptor> =
+    mutableSetOf<TypeParameterDescriptor>().also { extractTypeParametersFromUpperBounds(this, it, upperBoundOfTypeParameter) }
+
+private fun KotlinType.extractTypeParametersFromUpperBounds(
+    baseType: KotlinType,
+    to: MutableSet<TypeParameterDescriptor>,
+    upperBoundOfTypeParameter: TypeParameterDescriptor?
+) {
+    val declarationDescriptor = constructor.declarationDescriptor
+
+    if (declarationDescriptor is TypeParameterDescriptor) {
+        if (constructor != baseType.constructor) {
+            to += declarationDescriptor
+        } else {
+            for (upperBound in declarationDescriptor.upperBounds) {
+                upperBound.extractTypeParametersFromUpperBounds(baseType, to, upperBoundOfTypeParameter)
+            }
+        }
+    } else {
+        val typeParameters = (constructor.declarationDescriptor as? ClassifierDescriptorWithTypeParameters)?.declaredTypeParameters
+        for ((i, argument) in arguments.withIndex()) {
+            val typeParameter = typeParameters?.get(i)
+            if (argument.isStarProjection || (typeParameter != null && typeParameter == upperBoundOfTypeParameter)) continue
+            if (argument.type.constructor.declarationDescriptor in to || argument.type.constructor == baseType.constructor) continue
+            argument.type.extractTypeParametersFromUpperBounds(baseType, to, upperBoundOfTypeParameter)
+        }
+    }
+}
+
+fun hasTypeParameterRecursiveBounds(
+    typeParameter: TypeParameterDescriptor,
+    selfConstructor: TypeConstructor? = null,
+    upperBoundOfTypeParameter: TypeParameterDescriptor? = null
+): Boolean =
+    typeParameter.upperBounds.any { upperBound ->
+        upperBound.containsSelfTypeParameter(typeParameter.defaultType.constructor, upperBoundOfTypeParameter)
+                && (selfConstructor == null || upperBound.constructor == selfConstructor)
+    }
+
+private fun KotlinType.containsSelfTypeParameter(
+    baseConstructor: TypeConstructor,
+    upperBoundOfTypeParameter: TypeParameterDescriptor?
+): Boolean {
+    if (this.constructor == baseConstructor) return true
+
+    val typeParameters = (constructor.declarationDescriptor as? ClassifierDescriptorWithTypeParameters)?.declaredTypeParameters
+    return arguments.withIndex().any { (i, argument) ->
+        val typeParameter = typeParameters?.get(i)
+        if ((typeParameter != null && typeParameter == upperBoundOfTypeParameter) || argument.isStarProjection) return@any false
+        argument.type.containsSelfTypeParameter(baseConstructor, upperBoundOfTypeParameter)
+    }
+}
+
+fun KotlinType.replaceArgumentsWithStarProjectionOrMapped(
+    substitutor: TypeSubstitutor,
+    substitutionMap: Map<TypeConstructor, TypeProjection>,
+    variance: Variance,
+    upperBoundOfTypeParameter: TypeParameterDescriptor?
+) =
+    replaceArgumentsWith { typeParameterDescriptor ->
+        val argument = arguments.getOrNull(typeParameterDescriptor.index)
+        if (typeParameterDescriptor != upperBoundOfTypeParameter && argument != null && argument.type.constructor in substitutionMap) {
+            argument
+        } else StarProjectionImpl(typeParameterDescriptor)
+    }.let { substitutor.safeSubstitute(it, variance) }
+
+
+inline fun KotlinType.replaceArgumentsWith(replacement: (TypeParameterDescriptor) -> TypeProjection): KotlinType {
     val unwrapped = unwrap()
     return when (unwrapped) {
         is FlexibleType -> KotlinTypeFactory.flexibleType(
@@ -196,7 +263,7 @@ private inline fun KotlinType.replaceArgumentsWith(replacement: (TypeParameterDe
     }.inheritEnhancement(unwrapped)
 }
 
-private inline fun SimpleType.replaceArgumentsWith(replacement: (TypeParameterDescriptor) -> TypeProjection): SimpleType {
+inline fun SimpleType.replaceArgumentsWith(replacement: (TypeParameterDescriptor) -> TypeProjection): SimpleType {
     if (constructor.parameters.isEmpty() || constructor.declarationDescriptor == null) return this
 
     val newArguments = constructor.parameters.map(replacement)
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/checker/ClassicTypeSystemContext.kt b/core/descriptors/src/org/jetbrains/kotlin/types/checker/ClassicTypeSystemContext.kt
index 3caaef7c6f3..8b3f1b0f2d5 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/checker/ClassicTypeSystemContext.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/checker/ClassicTypeSystemContext.kt
@@ -26,6 +26,7 @@ import org.jetbrains.kotlin.types.*
 import org.jetbrains.kotlin.types.model.*
 import org.jetbrains.kotlin.types.typeUtil.asTypeProjection
 import org.jetbrains.kotlin.types.typeUtil.contains
+import org.jetbrains.kotlin.types.typeUtil.hasTypeParameterRecursiveBounds
 import org.jetbrains.kotlin.types.typeUtil.representativeUpperBound
 import org.jetbrains.kotlin.utils.addToStdlib.safeAs
 import org.jetbrains.kotlin.types.typeUtil.isSignedOrUnsignedNumberType as classicIsSignedOrUnsignedNumberType
@@ -220,11 +221,11 @@ interface ClassicTypeSystemContext : TypeSystemInferenceExtensionContext, TypeSy
         return this.typeConstructor
     }
 
-    override fun TypeParameterMarker.doesFormSelfType(selfConstructor: TypeConstructorMarker): Boolean {
+    override fun TypeParameterMarker.hasRecursiveBounds(selfConstructor: TypeConstructorMarker): Boolean {
         require(this is TypeParameterDescriptor, this::errorMessage)
         require(selfConstructor is TypeConstructor, this::errorMessage)
 
-        return doesTypeParameterFormSelfType(this, selfConstructor)
+        return hasTypeParameterRecursiveBounds(this, selfConstructor)
     }
 
     override fun areEqualTypeConstructors(c1: TypeConstructorMarker, c2: TypeConstructorMarker): Boolean {
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/checker/utils.kt b/core/descriptors/src/org/jetbrains/kotlin/types/checker/utils.kt
index 40c4cc7d627..c4a120adeb6 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/checker/utils.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/checker/utils.kt
@@ -21,7 +21,6 @@ import org.jetbrains.kotlin.descriptors.TypeParameterDescriptor
 import org.jetbrains.kotlin.renderer.DescriptorRenderer
 import org.jetbrains.kotlin.resolve.calls.inference.wrapWithCapturingSubstitution
 import org.jetbrains.kotlin.types.*
-import org.jetbrains.kotlin.types.typeUtil.contains
 import org.jetbrains.kotlin.types.typesApproximation.approximateCapturedTypes
 import java.util.*
 
@@ -106,8 +105,3 @@ private fun TypeConstructor.debugInfo() = buildString {
 interface NewTypeVariableConstructor {
     val originalTypeParameter: TypeParameterDescriptor?
 }
-
-fun doesTypeParameterFormSelfType(typeParameter: TypeParameterDescriptor, selfConstructor: TypeConstructor) =
-    typeParameter.upperBounds.any { upperBound ->
-        upperBound.contains { it.constructor == typeParameter.typeConstructor } && upperBound.constructor == selfConstructor
-    }