diff --git a/idea/src/org/jetbrains/kotlin/idea/actions/JavaToKotlinAction.kt b/idea/src/org/jetbrains/kotlin/idea/actions/JavaToKotlinAction.kt
index ae996bda146..aa0b0499501 100644
--- a/idea/src/org/jetbrains/kotlin/idea/actions/JavaToKotlinAction.kt
+++ b/idea/src/org/jetbrains/kotlin/idea/actions/JavaToKotlinAction.kt
@@ -35,9 +35,9 @@ import com.intellij.openapi.vfs.VirtualFileVisitor
 import com.intellij.psi.PsiJavaFile
 import com.intellij.psi.PsiManager
 import org.jetbrains.kotlin.idea.KotlinFileType
-import org.jetbrains.kotlin.idea.refactoring.toPsiFile
 import org.jetbrains.kotlin.idea.j2k.IdeaJavaToKotlinServices
 import org.jetbrains.kotlin.idea.j2k.J2kPostProcessor
+import org.jetbrains.kotlin.idea.refactoring.toPsiFile
 import org.jetbrains.kotlin.idea.util.application.executeWriteCommand
 import org.jetbrains.kotlin.idea.util.application.runReadAction
 import org.jetbrains.kotlin.j2k.ConverterSettings
@@ -45,7 +45,7 @@ import org.jetbrains.kotlin.j2k.JavaToKotlinConverter
 import org.jetbrains.kotlin.psi.KtFile
 import java.io.File
 import java.io.IOException
-import java.util.ArrayList
+import java.util.*
 
 class JavaToKotlinAction : AnAction() {
     companion object {
@@ -142,8 +142,17 @@ class JavaToKotlinAction : AnAction() {
     }
 
     override fun update(e: AnActionEvent) {
-        val enabled = selectedJavaFiles(e).any()
-        e.presentation.isEnabled = enabled
+        val virtualFiles = e.getData(CommonDataKeys.VIRTUAL_FILE_ARRAY) ?: return
+        val project = e.project ?: return
+
+        e.presentation.isEnabled = isAnyJavaFileSelected(project, virtualFiles)
+    }
+
+    private fun isAnyJavaFileSelected(project: Project, files: Array<VirtualFile>): Boolean {
+        val manager = PsiManager.getInstance(project)
+
+        if (files.any { manager.findFile(it) is PsiJavaFile }) return true
+        return files.any { it.isDirectory && isAnyJavaFileSelected(project, it.children) }
     }
 
     private fun selectedJavaFiles(e: AnActionEvent): Sequence<PsiJavaFile> {