diff --git a/crates/hir-ty/src/lower.rs b/crates/hir-ty/src/lower.rs
index dac20f22597..3e6d81f6ca9 100644
--- a/crates/hir-ty/src/lower.rs
+++ b/crates/hir-ty/src/lower.rs
@@ -1107,8 +1107,12 @@ fn assoc_type_bindings_from_type_bound(
                     binding.type_ref.as_ref().map_or(0, |_| 1) + binding.bounds.len(),
                 );
                 if let Some(type_ref) = &binding.type_ref {
-                    if let (TypeRef::ImplTrait(bounds), ImplTraitLoweringState::Disallowed) =
-                        (type_ref, &self.impl_trait_mode)
+                    if let (
+                        TypeRef::ImplTrait(bounds),
+                        ImplTraitLoweringState::Param(_)
+                        | ImplTraitLoweringState::Variable(_)
+                        | ImplTraitLoweringState::Disallowed,
+                    ) = (type_ref, &self.impl_trait_mode)
                     {
                         for bound in bounds {
                             predicates.extend(
diff --git a/crates/hir-ty/src/tests/traits.rs b/crates/hir-ty/src/tests/traits.rs
index b80cfe18e4c..ddb6ed82145 100644
--- a/crates/hir-ty/src/tests/traits.rs
+++ b/crates/hir-ty/src/tests/traits.rs
@@ -1278,6 +1278,40 @@ fn bar() {
     );
 }
 
+#[test]
+fn argument_assoc_impl_trait() {
+    check_infer(
+        r#"
+trait Outer {
+    type Item;
+}
+
+trait Inner { }
+
+fn foo<T: Outer<Item = impl Inner>>(baz: T) {
+}
+
+impl Outer for usize {
+    type Item = usize;
+}
+
+impl Inner for usize {}
+
+fn main() {
+    foo(2);
+}
+"#,
+        expect![[r#"
+            85..88 'baz': T
+            93..96 '{ }': ()
+            182..197 '{     foo(2); }': ()
+            188..191 'foo': fn foo<usize>(usize)
+            188..194 'foo(2)': ()
+            192..193 '2': usize
+        "#]],
+    );
+}
+
 #[test]
 fn simple_return_pos_impl_trait() {
     cov_mark::check!(lower_rpit);