diff --git a/compiler/backend/src/org/jetbrains/kotlin/codegen/AnnotationCodegen.java b/compiler/backend/src/org/jetbrains/kotlin/codegen/AnnotationCodegen.java
index 4e7294e2c8f..14c2b434fea 100644
--- a/compiler/backend/src/org/jetbrains/kotlin/codegen/AnnotationCodegen.java
+++ b/compiler/backend/src/org/jetbrains/kotlin/codegen/AnnotationCodegen.java
@@ -198,7 +198,7 @@ public abstract class AnnotationCodegen {
     private void generateTargetAnnotation(@NotNull ClassDescriptor classDescriptor, @NotNull Set<String> annotationDescriptorsAlreadyPresent) {
         String descriptor = Type.getType(Target.class).getDescriptor();
         if (!annotationDescriptorsAlreadyPresent.add(descriptor)) return;
-        Set<KotlinTarget> targets = AnnotationChecker.Companion.possibleTargetSet(classDescriptor);
+        Set<KotlinTarget> targets = AnnotationChecker.Companion.applicableTargetSet(classDescriptor);
         Set<ElementType> javaTargets;
         if (targets == null) {
             javaTargets = getJavaTargetList(classDescriptor);
diff --git a/compiler/frontend/src/org/jetbrains/kotlin/resolve/AnnotationChecker.kt b/compiler/frontend/src/org/jetbrains/kotlin/resolve/AnnotationChecker.kt
index a7c8c9fa1d7..e83471285f2 100644
--- a/compiler/frontend/src/org/jetbrains/kotlin/resolve/AnnotationChecker.kt
+++ b/compiler/frontend/src/org/jetbrains/kotlin/resolve/AnnotationChecker.kt
@@ -51,7 +51,7 @@ public class AnnotationChecker(private val additionalCheckers: Iterable<Addition
     }
 
     public fun checkExpression(expression: JetExpression, trace: BindingTrace) {
-        checkEntries(expression.getAnnotationEntries(), listOf(KotlinTarget.EXPRESSION), trace)
+        checkEntries(expression.getAnnotationEntries(), targetList(KotlinTarget.EXPRESSION), trace)
         if (expression is JetFunctionLiteralExpression) {
             for (parameter in expression.valueParameters) {
                 parameter.typeReference?.let { check(it, trace) }
@@ -59,7 +59,7 @@ public class AnnotationChecker(private val additionalCheckers: Iterable<Addition
         }
     }
 
-    private fun checkEntries(entries: List<JetAnnotationEntry>, actualTargets: List<KotlinTarget>, trace: BindingTrace) {
+    private fun checkEntries(entries: List<JetAnnotationEntry>, actualTargets: TargetList, trace: BindingTrace) {
         val entryTypes: MutableSet<JetType> = hashSetOf()
         for (entry in entries) {
             checkAnnotationEntry(entry, actualTargets, trace)
@@ -69,26 +69,39 @@ public class AnnotationChecker(private val additionalCheckers: Iterable<Addition
                 trace.report(Errors.REPEATED_ANNOTATION.on(entry));
             }
         }
-        additionalCheckers.forEach { it.checkEntries(entries, actualTargets, trace) }
+        additionalCheckers.forEach { it.checkEntries(entries, actualTargets.declarationSite, trace) }
     }
 
-    private fun checkAnnotationEntry(entry: JetAnnotationEntry, actualTargets: List<KotlinTarget>, trace: BindingTrace) {
-        val possibleTargets = possibleTargetSet(entry, trace)
-        if (actualTargets.any { it in possibleTargets }) return
-        trace.report(Errors.WRONG_ANNOTATION_TARGET.on(entry, actualTargets.firstOrNull()?.description ?: "unidentified target"))
+    private fun checkAnnotationEntry(entry: JetAnnotationEntry, actualTargets: TargetList, trace: BindingTrace) {
+        val applicableTargets = applicableTargetSet(entry, trace)
+        val useSiteTarget = entry.useSiteTarget?.getAnnotationUseSiteTarget()
+
+        if (actualTargets.declarationSite.any {
+            it in applicableTargets && (useSiteTarget == null || KotlinTarget.USE_SITE_MAPPING[useSiteTarget] == it)
+        }) return
+
+        if (useSiteTarget != null && actualTargets.useSite.any {
+            it in applicableTargets && KotlinTarget.USE_SITE_MAPPING[useSiteTarget] == it
+        }) return
+
+        trace.report(Errors.WRONG_ANNOTATION_TARGET.on(entry, actualTargets.declarationSite.firstOrNull()?.description ?: "unidentified target"))
     }
 
     companion object {
 
-        private fun possibleTargetSet(entry: JetAnnotationEntry, trace: BindingTrace): Set<KotlinTarget> {
+        private val PROPERTY_USE_SITE_TARGETS = listOf(
+                KotlinTarget.FIELD, KotlinTarget.PROPERTY_GETTER, KotlinTarget.PROPERTY_SETTER, KotlinTarget.VALUE_PARAMETER)
+        private val VALUE_PARAMETER_USE_SITE_TARGETS = PROPERTY_USE_SITE_TARGETS + KotlinTarget.PROPERTY
+
+        private fun applicableTargetSet(entry: JetAnnotationEntry, trace: BindingTrace): Set<KotlinTarget> {
             val descriptor = trace.get(BindingContext.ANNOTATION, entry) ?: return KotlinTarget.DEFAULT_TARGET_SET
             // For descriptor with error type, all targets are considered as possible
             if (descriptor.type.isError) return KotlinTarget.ALL_TARGET_SET
             val classDescriptor = TypeUtils.getClassDescriptor(descriptor.type) ?: return KotlinTarget.DEFAULT_TARGET_SET
-            return possibleTargetSet(classDescriptor) ?: KotlinTarget.DEFAULT_TARGET_SET
+            return applicableTargetSet(classDescriptor) ?: KotlinTarget.DEFAULT_TARGET_SET
         }
 
-        public fun possibleTargetSet(classDescriptor: ClassDescriptor): Set<KotlinTarget>? {
+        public fun applicableTargetSet(classDescriptor: ClassDescriptor): Set<KotlinTarget>? {
             val targetEntryDescriptor = classDescriptor.annotations.findAnnotation(KotlinBuiltIns.FQ_NAMES.target)
                                         ?: return null
             val valueArguments = targetEntryDescriptor.allValueArguments
@@ -98,41 +111,71 @@ public class AnnotationChecker(private val additionalCheckers: Iterable<Addition
             }.filterNotNull().toSet()
         }
 
-        public fun getActualTargetList(annotated: JetElement, descriptor: ClassDescriptor?): List<KotlinTarget> {
+        public fun getDeclarationSiteActualTargetList(annotated: JetElement, descriptor: ClassDescriptor?): List<KotlinTarget> {
+            return getActualTargetList(annotated, descriptor).declarationSite
+        }
+
+        private fun getActualTargetList(annotated: JetElement, descriptor: ClassDescriptor?): TargetList {
             return when (annotated) {
-                is JetClassOrObject -> descriptor?.let { KotlinTarget.classActualTargets(it) } ?: listOf(CLASSIFIER)
+                is JetClassOrObject -> descriptor?.let { TargetList(KotlinTarget.classActualTargets(it)) } ?: targetList(CLASSIFIER)
                 is JetProperty ->
                     if (annotated.isLocal) {
-                        listOf(LOCAL_VARIABLE)
+                        extendedTargetList(PROPERTY_USE_SITE_TARGETS, LOCAL_VARIABLE)
                     }
                     else if (annotated.parent is JetClassOrObject || annotated.parent is JetClassBody) {
-                        listOf(MEMBER_PROPERTY, PROPERTY, FIELD)
+                        extendedTargetList(PROPERTY_USE_SITE_TARGETS, MEMBER_PROPERTY, PROPERTY, FIELD)
                     }
                     else {
-                        listOf(TOP_LEVEL_PROPERTY, PROPERTY, FIELD)
+                        extendedTargetList(PROPERTY_USE_SITE_TARGETS, TOP_LEVEL_PROPERTY, PROPERTY, FIELD)
                     }
-                is JetParameter -> if (annotated.hasValOrVar()) listOf(PROPERTY_PARAMETER, MEMBER_PROPERTY, PROPERTY, FIELD) else listOf(VALUE_PARAMETER)
-                is JetConstructor<*> -> listOf(CONSTRUCTOR)
-                is JetFunction ->
+                is JetParameter -> {
+                    if (annotated.hasValOrVar()) {
+                        extendedTargetList(VALUE_PARAMETER_USE_SITE_TARGETS, PROPERTY_PARAMETER, MEMBER_PROPERTY, PROPERTY, FIELD)
+                    }
+                    else {
+                        extendedTargetList(VALUE_PARAMETER_USE_SITE_TARGETS, VALUE_PARAMETER)
+                    }
+                }
+                is JetConstructor<*> -> targetList(CONSTRUCTOR)
+                is JetFunction -> {
+                    val extendedTargets = listOf(KotlinTarget.VALUE_PARAMETER)
                     if (annotated.isLocal) {
-                        listOf(LOCAL_FUNCTION, FUNCTION)
+                        extendedTargetList(extendedTargets, LOCAL_FUNCTION, FUNCTION)
                     }
                     else if (annotated.parent is JetClassOrObject || annotated.parent is JetClassBody) {
-                        listOf(MEMBER_FUNCTION, FUNCTION)
+                        extendedTargetList(extendedTargets, MEMBER_FUNCTION, FUNCTION)
                     }
                     else {
-                        listOf(TOP_LEVEL_FUNCTION, FUNCTION)
+                        extendedTargetList(extendedTargets, TOP_LEVEL_FUNCTION, FUNCTION)
                     }
-                is JetPropertyAccessor -> if (annotated.isGetter) listOf(PROPERTY_GETTER) else listOf(PROPERTY_SETTER)
-                is JetPackageDirective -> listOf(PACKAGE)
-                is JetTypeReference -> listOf(TYPE)
-                is JetFile -> listOf(FILE)
-                is JetTypeParameter -> listOf(TYPE_PARAMETER)
-                is JetTypeProjection -> if (annotated.projectionKind == JetProjectionKind.STAR) listOf(STAR_PROJECTION) else listOf(TYPE_PROJECTION)
-                is JetClassInitializer -> listOf(INITIALIZER)
-                else -> listOf()
+                }
+                is JetPropertyAccessor -> if (annotated.isGetter) targetList(PROPERTY_GETTER) else targetList(PROPERTY_SETTER)
+                is JetPackageDirective -> targetList(PACKAGE)
+                is JetTypeReference -> targetList(TYPE)
+                is JetFile -> targetList(FILE)
+                is JetTypeParameter -> targetList(TYPE_PARAMETER)
+                is JetTypeProjection -> {
+                    if (annotated.projectionKind == JetProjectionKind.STAR) {
+                        targetList(STAR_PROJECTION)
+                    }
+                    else {
+                        targetList(TYPE_PROJECTION)
+                    }
+                }
+                is JetClassInitializer -> targetList(INITIALIZER)
+                else -> targetList()
             }
         }
+
+        private class TargetList(val declarationSite: List<KotlinTarget>, val useSite: List<KotlinTarget> = emptyList())
+
+        private fun targetList(vararg target: KotlinTarget): TargetList {
+            return TargetList(listOf(*target), emptyList())
+        }
+
+        private fun extendedTargetList(extended: List<KotlinTarget>, vararg target: KotlinTarget): TargetList {
+            return TargetList(listOf(*target), extended)
+        }
     }
 }
 
diff --git a/compiler/frontend/src/org/jetbrains/kotlin/resolve/ModifiersChecker.kt b/compiler/frontend/src/org/jetbrains/kotlin/resolve/ModifiersChecker.kt
index ed583743c8d..0dece5ca3aa 100644
--- a/compiler/frontend/src/org/jetbrains/kotlin/resolve/ModifiersChecker.kt
+++ b/compiler/frontend/src/org/jetbrains/kotlin/resolve/ModifiersChecker.kt
@@ -208,7 +208,7 @@ public object ModifierCheckerCore {
                 }
             }
         }
-        val actualTargets = AnnotationChecker.getActualTargetList(listOwner, descriptor as? ClassDescriptor)
+        val actualTargets = AnnotationChecker.getDeclarationSiteActualTargetList(listOwner, descriptor as? ClassDescriptor)
         val list = listOwner.modifierList ?: return
         checkModifierList(list, trace, descriptor?.containingDeclaration, actualTargets)
     }
diff --git a/core/descriptors/src/org/jetbrains/kotlin/descriptors/annotations/KotlinTarget.kt b/core/descriptors/src/org/jetbrains/kotlin/descriptors/annotations/KotlinTarget.kt
index c13f49f849e..dc7e154c3f9 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/descriptors/annotations/KotlinTarget.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/descriptors/annotations/KotlinTarget.kt
@@ -102,5 +102,16 @@ public enum class KotlinTarget(val description: String, val isDefault: Boolean =
                 }
             ClassKind.ENUM_ENTRY -> listOf(ENUM_ENTRY, PROPERTY, FIELD)
         }
+
+        public val USE_SITE_MAPPING: Map<AnnotationUseSiteTarget, KotlinTarget> = mapOf(
+                AnnotationUseSiteTarget.CONSTRUCTOR_PARAMETER to VALUE_PARAMETER,
+                AnnotationUseSiteTarget.FIELD to FIELD,
+                AnnotationUseSiteTarget.PROPERTY to PROPERTY,
+                AnnotationUseSiteTarget.FILE to FILE,
+                AnnotationUseSiteTarget.PROPERTY_GETTER to PROPERTY_GETTER,
+                AnnotationUseSiteTarget.PROPERTY_SETTER to PROPERTY_SETTER,
+                AnnotationUseSiteTarget.RECEIVER to VALUE_PARAMETER,
+                AnnotationUseSiteTarget.SETTER_PARAMETER to VALUE_PARAMETER)
+
     }
 }
\ No newline at end of file