diff --git a/compiler/fir/resolve/tests/org/jetbrains/kotlin/fir/FirDiagnosticsSmokeTestGenerated.java b/compiler/fir/resolve/tests/org/jetbrains/kotlin/fir/FirDiagnosticsSmokeTestGenerated.java
index 25f46a73033..21e6c01df9c 100644
--- a/compiler/fir/resolve/tests/org/jetbrains/kotlin/fir/FirDiagnosticsSmokeTestGenerated.java
+++ b/compiler/fir/resolve/tests/org/jetbrains/kotlin/fir/FirDiagnosticsSmokeTestGenerated.java
@@ -17395,6 +17395,11 @@ public class FirDiagnosticsSmokeTestGenerated extends AbstractFirDiagnosticsSmok
             runTest("compiler/testData/diagnostics/tests/regressions/kt316.kt");
         }
 
+        @TestMetadata("kt31975.kt")
+        public void testKt31975() throws Exception {
+            runTest("compiler/testData/diagnostics/tests/regressions/kt31975.kt");
+        }
+
         @TestMetadata("kt32205.kt")
         public void testKt32205() throws Exception {
             runTest("compiler/testData/diagnostics/tests/regressions/kt32205.kt");
diff --git a/compiler/frontend/src/org/jetbrains/kotlin/resolve/calls/DiagnosticReporterByTrackingStrategy.kt b/compiler/frontend/src/org/jetbrains/kotlin/resolve/calls/DiagnosticReporterByTrackingStrategy.kt
index 4219d3623c7..bbbb0b02fd6 100644
--- a/compiler/frontend/src/org/jetbrains/kotlin/resolve/calls/DiagnosticReporterByTrackingStrategy.kt
+++ b/compiler/frontend/src/org/jetbrains/kotlin/resolve/calls/DiagnosticReporterByTrackingStrategy.kt
@@ -357,10 +357,13 @@ class DiagnosticReporterByTrackingStrategy(
             }
 
             NotEnoughInformationForTypeParameter::class.java -> {
-                if (allDiagnostics.any {it is ConstrainingTypeIsError || it is NewConstraintError || it is WrongCountOfTypeArguments})
-                    return
-
                 val error = diagnostic as NotEnoughInformationForTypeParameter
+                if (allDiagnostics.any {
+                        (it is ConstrainingTypeIsError && it.typeVariable == error.typeVariable)
+                                || it is NewConstraintError || it is WrongCountOfTypeArguments
+                    }
+                ) return
+
                 val call = error.resolvedAtom.atom?.safeAs<PSIKotlinCall>()?.psiCall ?: call
                 val expression = call.calleeExpression ?: return
                 val typeVariableName = when (val typeVariable = error.typeVariable) {
diff --git a/compiler/testData/diagnostics/tests/inference/constraints/errorUpperBoundConstraint.kt b/compiler/testData/diagnostics/tests/inference/constraints/errorUpperBoundConstraint.kt
index 26de6fec138..187422bdd1c 100644
--- a/compiler/testData/diagnostics/tests/inference/constraints/errorUpperBoundConstraint.kt
+++ b/compiler/testData/diagnostics/tests/inference/constraints/errorUpperBoundConstraint.kt
@@ -20,7 +20,7 @@ public class Foo {
 // FILE: test.kt
 
 fun test(e: <!UNRESOLVED_REFERENCE!>ErrorType<!>) {
-    Foo.foo {
+    Foo.<!NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER!>foo<!> {
         Sam.Result.create(<!DEBUG_INFO_ELEMENT_WITH_ERROR_TYPE!>e<!>)
     }
 }
\ No newline at end of file
diff --git a/compiler/testData/diagnostics/tests/regressions/kt31975.kt b/compiler/testData/diagnostics/tests/regressions/kt31975.kt
new file mode 100644
index 00000000000..1b59ff233d1
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/regressions/kt31975.kt
@@ -0,0 +1,18 @@
+// !LANGUAGE: +NewInference
+// !DIAGNOSTICS: -UNUSED_PARAMETER
+
+interface MemoizedFunctionToNotNull<K, V>
+
+fun <K, V : Any> createMemoizedFunction(compute: (K) -> V): MemoizedFunctionToNotNull<K, V> = TODO()
+
+interface A
+
+interface TypeConstructor
+
+class Refiner {
+    val memoizedFunctionLambda = <!NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER!>createMemoizedFunction<!> { <!DEBUG_INFO_ELEMENT_WITH_ERROR_TYPE!>it<!>.<!DEBUG_INFO_ELEMENT_WITH_ERROR_TYPE!>foo<!>() } // error type infered, no diagnostic, BAD, backend fails
+    val memoizedFunctionReference = createMemoizedFunction(TypeConstructor::<!EXTENSION_IN_CLASS_REFERENCE_NOT_ALLOWED!>foo<!>) // EXTENSION_IN_CLASS_REFERENCE_IS_NOT_ALLOWED, fine
+    val memoizedFunctionTypes = createMemoizedFunction<TypeConstructor, Boolean> { it.foo() } // works fine
+
+    private fun TypeConstructor.foo(): Boolean = true
+}
diff --git a/compiler/testData/diagnostics/tests/regressions/kt31975.txt b/compiler/testData/diagnostics/tests/regressions/kt31975.txt
new file mode 100644
index 00000000000..fb0c297b3ba
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/regressions/kt31975.txt
@@ -0,0 +1,32 @@
+package
+
+public fun </*0*/ K, /*1*/ V : kotlin.Any> createMemoizedFunction(/*0*/ compute: (K) -> V): MemoizedFunctionToNotNull<K, V>
+
+public interface A {
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+}
+
+public interface MemoizedFunctionToNotNull</*0*/ K, /*1*/ V> {
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+}
+
+public final class Refiner {
+    public constructor Refiner()
+    public final val memoizedFunctionLambda: [ERROR : Type for createMemoizedFunction { it.foo() }]
+    public final val memoizedFunctionReference: MemoizedFunctionToNotNull<TypeConstructor, kotlin.Boolean>
+    public final val memoizedFunctionTypes: MemoizedFunctionToNotNull<TypeConstructor, kotlin.Boolean>
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+    private final fun TypeConstructor.foo(): kotlin.Boolean
+}
+
+public interface TypeConstructor {
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+}
diff --git a/compiler/tests/org/jetbrains/kotlin/checkers/DiagnosticsTestGenerated.java b/compiler/tests/org/jetbrains/kotlin/checkers/DiagnosticsTestGenerated.java
index 5b2d8637185..c53f3b995ca 100644
--- a/compiler/tests/org/jetbrains/kotlin/checkers/DiagnosticsTestGenerated.java
+++ b/compiler/tests/org/jetbrains/kotlin/checkers/DiagnosticsTestGenerated.java
@@ -17407,6 +17407,11 @@ public class DiagnosticsTestGenerated extends AbstractDiagnosticsTest {
                 runTest("compiler/testData/diagnostics/tests/regressions/kt316.kt");
             }
 
+            @TestMetadata("kt31975.kt")
+            public void testKt31975() throws Exception {
+                runTest("compiler/testData/diagnostics/tests/regressions/kt31975.kt");
+            }
+
             @TestMetadata("kt32205.kt")
             public void testKt32205() throws Exception {
                 runTest("compiler/testData/diagnostics/tests/regressions/kt32205.kt");
diff --git a/compiler/tests/org/jetbrains/kotlin/checkers/javac/DiagnosticsUsingJavacTestGenerated.java b/compiler/tests/org/jetbrains/kotlin/checkers/javac/DiagnosticsUsingJavacTestGenerated.java
index 0020f48e281..05798236e39 100644
--- a/compiler/tests/org/jetbrains/kotlin/checkers/javac/DiagnosticsUsingJavacTestGenerated.java
+++ b/compiler/tests/org/jetbrains/kotlin/checkers/javac/DiagnosticsUsingJavacTestGenerated.java
@@ -17397,6 +17397,11 @@ public class DiagnosticsUsingJavacTestGenerated extends AbstractDiagnosticsUsing
                 runTest("compiler/testData/diagnostics/tests/regressions/kt316.kt");
             }
 
+            @TestMetadata("kt31975.kt")
+            public void testKt31975() throws Exception {
+                runTest("compiler/testData/diagnostics/tests/regressions/kt31975.kt");
+            }
+
             @TestMetadata("kt32205.kt")
             public void testKt32205() throws Exception {
                 runTest("compiler/testData/diagnostics/tests/regressions/kt32205.kt");