diff --git a/compiler/testData/diagnostics/tests/inference/constraints/kt6320.kt b/compiler/testData/diagnostics/tests/inference/constraints/kt6320.kt
new file mode 100644
index 00000000000..b8ad6688ae5
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/inference/constraints/kt6320.kt
@@ -0,0 +1,20 @@
+// !DIAGNOSTICS: -UNUSED_VARIABLE
+// AssertionError in ConstraintSystem(The constraint shouldn't contain different type variables on both sides: Y <: X)
+
+class A<X, Y : X>
+
+class B<X, Y : X>(foo: A<X, Y>) {
+    fun test1(a: A<X, Y>) {
+        B(a)
+        val b: B<X, Y> = B(a)
+        // crash here
+    }
+}
+
+class C<X, Z, Y : X>
+
+class D<X, Z, Y : X>(foo: C<X, Z, Y>) {
+    fun test(a: C<Y, Y, Y>) {
+        val d: D<X, Y, Y> = <!TYPE_MISMATCH!>D(a)<!>
+    }
+}
\ No newline at end of file
diff --git a/compiler/testData/diagnostics/tests/inference/constraints/kt6320.txt b/compiler/testData/diagnostics/tests/inference/constraints/kt6320.txt
new file mode 100644
index 00000000000..9b23f72ca4b
--- /dev/null
+++ b/compiler/testData/diagnostics/tests/inference/constraints/kt6320.txt
@@ -0,0 +1,31 @@
+package
+
+internal final class A</*0*/ X, /*1*/ Y : X> {
+    public constructor A</*0*/ X, /*1*/ Y : X>()
+    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
+}
+
+internal final class B</*0*/ X, /*1*/ Y : X> {
+    public constructor B</*0*/ X, /*1*/ Y : X>(/*0*/ foo: A<X, Y>)
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    internal final fun test1(/*0*/ a: A<X, Y>): kotlin.Unit
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+}
+
+internal final class C</*0*/ X, /*1*/ Z, /*2*/ Y : X> {
+    public constructor C</*0*/ X, /*1*/ Z, /*2*/ Y : X>()
+    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
+}
+
+internal final class D</*0*/ X, /*1*/ Z, /*2*/ Y : X> {
+    public constructor D</*0*/ X, /*1*/ Z, /*2*/ Y : X>(/*0*/ foo: C<X, Z, Y>)
+    public open override /*1*/ /*fake_override*/ fun equals(/*0*/ other: kotlin.Any?): kotlin.Boolean
+    public open override /*1*/ /*fake_override*/ fun hashCode(): kotlin.Int
+    internal final fun test(/*0*/ a: C<Y, Y, Y>): kotlin.Unit
+    public open override /*1*/ /*fake_override*/ fun toString(): kotlin.String
+}
diff --git a/compiler/tests/org/jetbrains/jet/checkers/JetDiagnosticsTestGenerated.java b/compiler/tests/org/jetbrains/jet/checkers/JetDiagnosticsTestGenerated.java
index 5e620012ced..689158dee78 100644
--- a/compiler/tests/org/jetbrains/jet/checkers/JetDiagnosticsTestGenerated.java
+++ b/compiler/tests/org/jetbrains/jet/checkers/JetDiagnosticsTestGenerated.java
@@ -5151,6 +5151,12 @@ public class JetDiagnosticsTestGenerated extends AbstractJetDiagnosticsTest {
                     doTest(fileName);
                 }
 
+                @TestMetadata("kt6320.kt")
+                public void testKt6320() throws Exception {
+                    String fileName = JetTestUtils.navigationMetadata("compiler/testData/diagnostics/tests/inference/constraints/kt6320.kt");
+                    doTest(fileName);
+                }
+
                 @TestMetadata("notNullConstraintOnNullableType.kt")
                 public void testNotNullConstraintOnNullableType() throws Exception {
                     String fileName = JetTestUtils.navigationMetadata("compiler/testData/diagnostics/tests/inference/constraints/notNullConstraintOnNullableType.kt");
diff --git a/core/descriptors/src/org/jetbrains/jet/lang/resolve/calls/inference/ConstraintSystemImpl.kt b/core/descriptors/src/org/jetbrains/jet/lang/resolve/calls/inference/ConstraintSystemImpl.kt
index 45e2794a81c..b32759e918b 100644
--- a/core/descriptors/src/org/jetbrains/jet/lang/resolve/calls/inference/ConstraintSystemImpl.kt
+++ b/core/descriptors/src/org/jetbrains/jet/lang/resolve/calls/inference/ConstraintSystemImpl.kt
@@ -304,13 +304,9 @@ public class ConstraintSystemImpl : ConstraintSystem {
         }
 
         fun simplifyConstraint(subType: JetType, superType: JetType) {
-            // can be equal for the recursive invocations:
-            // fun <T> foo(i: Int) : T { ... return foo(i); } => T <: T
-            if (isMyTypeVariable(subType) && isMyTypeVariable(superType) && JetTypeChecker.DEFAULT.equalTypes(subType, superType)) return
-
-            assert(!isMyTypeVariable(subType) || !isMyTypeVariable(superType)) {
-                "The constraint shouldn't contain different type variables on both sides: " + subType + " <: " + superType
-            }
+            // can be equal for the recursive invocations: fun <T> foo(i: Int) : T { ... return foo(i); } => T <: T
+            // the right processing of constraints connecting type variables is not supported yet
+            if (isMyTypeVariable(subType) && isMyTypeVariable(superType)) return
 
             if (isMyTypeVariable(subType)) {
                 val boundKind = if (constraintKind == SUB_TYPE) UPPER_BOUND else EXACT_BOUND