diff --git a/src/compiler/checker.ts b/src/compiler/checker.ts
index 2217f2f430b82..db0b3a6db9141 100644
--- a/src/compiler/checker.ts
+++ b/src/compiler/checker.ts
@@ -1822,9 +1822,10 @@ namespace ts {
 
             // Perform extra checks only if error reporting was requested
             if (nameNotFoundMessage) {
-                if (propertyWithInvalidInitializer) {
+                if (propertyWithInvalidInitializer && !(compilerOptions.target === ScriptTarget.ESNext && compilerOptions.useDefineForClassFields)) {
                     // We have a match, but the reference occurred within a property initializer and the identifier also binds
-                    // to a local variable in the constructor where the code will be emitted.
+                    // to a local variable in the constructor where the code will be emitted. Note that this is actually allowed
+                    // with ESNext+useDefineForClassFields because the scope semantics are different.
                     const propertyName = (<PropertyDeclaration>propertyWithInvalidInitializer).name;
                     error(errorLocation, Diagnostics.Initializer_of_instance_member_variable_0_cannot_reference_identifier_1_declared_in_the_constructor,
                         declarationNameToString(propertyName), diagnosticName(nameArg!));
diff --git a/tests/baselines/reference/constructorParameterShadowsOuterScopes2.errors.txt b/tests/baselines/reference/constructorParameterShadowsOuterScopes2.errors.txt
new file mode 100644
index 0000000000000..7b2f3c6121a4b
--- /dev/null
+++ b/tests/baselines/reference/constructorParameterShadowsOuterScopes2.errors.txt
@@ -0,0 +1,38 @@
+tests/cases/conformance/classes/propertyMemberDeclarations/constructorParameterShadowsOuterScopes2.ts(28,9): error TS2304: Cannot find name 'z'.
+
+
+==== tests/cases/conformance/classes/propertyMemberDeclarations/constructorParameterShadowsOuterScopes2.ts (1 errors) ====
+    // With useDefineForClassFields: true and ESNext target, initializer
+    // expressions for property declarations are evaluated in the scope of
+    // the class body and are permitted to reference parameters or local
+    // variables of the constructor. This is different from classic
+    // Typescript behaviour, with useDefineForClassFields: false. There,
+    // initialisers of property declarations are evaluated in the scope of
+    // the constructor body.
+    
+    // Note that when class fields are accepted in the ECMAScript
+    // standard, the target will become that year's ES20xx
+    
+    var x = 1;
+    class C {
+        b = x; // ok
+        constructor(x: string) {
+        }
+    }
+    
+    var y = 1;
+    class D {
+        b = y; // ok
+        constructor(x: string) {
+            var y = "";
+        }
+    }
+    
+    class E {
+        b = z; // not ok
+            ~
+!!! error TS2304: Cannot find name 'z'.
+        constructor(z: string) {
+        }
+    }
+    
\ No newline at end of file
diff --git a/tests/baselines/reference/constructorParameterShadowsOuterScopes2.js b/tests/baselines/reference/constructorParameterShadowsOuterScopes2.js
new file mode 100644
index 0000000000000..a266bc5b0fb19
--- /dev/null
+++ b/tests/baselines/reference/constructorParameterShadowsOuterScopes2.js
@@ -0,0 +1,62 @@
+//// [constructorParameterShadowsOuterScopes2.ts]
+// With useDefineForClassFields: true and ESNext target, initializer
+// expressions for property declarations are evaluated in the scope of
+// the class body and are permitted to reference parameters or local
+// variables of the constructor. This is different from classic
+// Typescript behaviour, with useDefineForClassFields: false. There,
+// initialisers of property declarations are evaluated in the scope of
+// the constructor body.
+
+// Note that when class fields are accepted in the ECMAScript
+// standard, the target will become that year's ES20xx
+
+var x = 1;
+class C {
+    b = x; // ok
+    constructor(x: string) {
+    }
+}
+
+var y = 1;
+class D {
+    b = y; // ok
+    constructor(x: string) {
+        var y = "";
+    }
+}
+
+class E {
+    b = z; // not ok
+    constructor(z: string) {
+    }
+}
+
+
+//// [constructorParameterShadowsOuterScopes2.js]
+// With useDefineForClassFields: true and ESNext target, initializer
+// expressions for property declarations are evaluated in the scope of
+// the class body and are permitted to reference parameters or local
+// variables of the constructor. This is different from classic
+// Typescript behaviour, with useDefineForClassFields: false. There,
+// initialisers of property declarations are evaluated in the scope of
+// the constructor body.
+// Note that when class fields are accepted in the ECMAScript
+// standard, the target will become that year's ES20xx
+var x = 1;
+class C {
+    b = x; // ok
+    constructor(x) {
+    }
+}
+var y = 1;
+class D {
+    b = y; // ok
+    constructor(x) {
+        var y = "";
+    }
+}
+class E {
+    b = z; // not ok
+    constructor(z) {
+    }
+}
diff --git a/tests/baselines/reference/constructorParameterShadowsOuterScopes2.symbols b/tests/baselines/reference/constructorParameterShadowsOuterScopes2.symbols
new file mode 100644
index 0000000000000..01bb0bb7613fa
--- /dev/null
+++ b/tests/baselines/reference/constructorParameterShadowsOuterScopes2.symbols
@@ -0,0 +1,56 @@
+=== tests/cases/conformance/classes/propertyMemberDeclarations/constructorParameterShadowsOuterScopes2.ts ===
+// With useDefineForClassFields: true and ESNext target, initializer
+// expressions for property declarations are evaluated in the scope of
+// the class body and are permitted to reference parameters or local
+// variables of the constructor. This is different from classic
+// Typescript behaviour, with useDefineForClassFields: false. There,
+// initialisers of property declarations are evaluated in the scope of
+// the constructor body.
+
+// Note that when class fields are accepted in the ECMAScript
+// standard, the target will become that year's ES20xx
+
+var x = 1;
+>x : Symbol(x, Decl(constructorParameterShadowsOuterScopes2.ts, 11, 3))
+
+class C {
+>C : Symbol(C, Decl(constructorParameterShadowsOuterScopes2.ts, 11, 10))
+
+    b = x; // ok
+>b : Symbol(C.b, Decl(constructorParameterShadowsOuterScopes2.ts, 12, 9))
+>x : Symbol(x, Decl(constructorParameterShadowsOuterScopes2.ts, 11, 3))
+
+    constructor(x: string) {
+>x : Symbol(x, Decl(constructorParameterShadowsOuterScopes2.ts, 14, 16))
+    }
+}
+
+var y = 1;
+>y : Symbol(y, Decl(constructorParameterShadowsOuterScopes2.ts, 18, 3))
+
+class D {
+>D : Symbol(D, Decl(constructorParameterShadowsOuterScopes2.ts, 18, 10))
+
+    b = y; // ok
+>b : Symbol(D.b, Decl(constructorParameterShadowsOuterScopes2.ts, 19, 9))
+>y : Symbol(y, Decl(constructorParameterShadowsOuterScopes2.ts, 18, 3))
+
+    constructor(x: string) {
+>x : Symbol(x, Decl(constructorParameterShadowsOuterScopes2.ts, 21, 16))
+
+        var y = "";
+>y : Symbol(y, Decl(constructorParameterShadowsOuterScopes2.ts, 22, 11))
+    }
+}
+
+class E {
+>E : Symbol(E, Decl(constructorParameterShadowsOuterScopes2.ts, 24, 1))
+
+    b = z; // not ok
+>b : Symbol(E.b, Decl(constructorParameterShadowsOuterScopes2.ts, 26, 9))
+
+    constructor(z: string) {
+>z : Symbol(z, Decl(constructorParameterShadowsOuterScopes2.ts, 28, 16))
+    }
+}
+
diff --git a/tests/baselines/reference/constructorParameterShadowsOuterScopes2.types b/tests/baselines/reference/constructorParameterShadowsOuterScopes2.types
new file mode 100644
index 0000000000000..c9c24a45e5e6f
--- /dev/null
+++ b/tests/baselines/reference/constructorParameterShadowsOuterScopes2.types
@@ -0,0 +1,60 @@
+=== tests/cases/conformance/classes/propertyMemberDeclarations/constructorParameterShadowsOuterScopes2.ts ===
+// With useDefineForClassFields: true and ESNext target, initializer
+// expressions for property declarations are evaluated in the scope of
+// the class body and are permitted to reference parameters or local
+// variables of the constructor. This is different from classic
+// Typescript behaviour, with useDefineForClassFields: false. There,
+// initialisers of property declarations are evaluated in the scope of
+// the constructor body.
+
+// Note that when class fields are accepted in the ECMAScript
+// standard, the target will become that year's ES20xx
+
+var x = 1;
+>x : number
+>1 : 1
+
+class C {
+>C : C
+
+    b = x; // ok
+>b : number
+>x : number
+
+    constructor(x: string) {
+>x : string
+    }
+}
+
+var y = 1;
+>y : number
+>1 : 1
+
+class D {
+>D : D
+
+    b = y; // ok
+>b : number
+>y : number
+
+    constructor(x: string) {
+>x : string
+
+        var y = "";
+>y : string
+>"" : ""
+    }
+}
+
+class E {
+>E : E
+
+    b = z; // not ok
+>b : any
+>z : any
+
+    constructor(z: string) {
+>z : string
+    }
+}
+
diff --git a/tests/cases/conformance/classes/propertyMemberDeclarations/constructorParameterShadowsOuterScopes2.ts b/tests/cases/conformance/classes/propertyMemberDeclarations/constructorParameterShadowsOuterScopes2.ts
new file mode 100644
index 0000000000000..d6c5be3bd7957
--- /dev/null
+++ b/tests/cases/conformance/classes/propertyMemberDeclarations/constructorParameterShadowsOuterScopes2.ts
@@ -0,0 +1,35 @@
+// @target: esnext
+// @useDefineForClassFields: true
+
+
+// With useDefineForClassFields: true and ESNext target, initializer
+// expressions for property declarations are evaluated in the scope of
+// the class body and are permitted to reference parameters or local
+// variables of the constructor. This is different from classic
+// Typescript behaviour, with useDefineForClassFields: false. There,
+// initialisers of property declarations are evaluated in the scope of
+// the constructor body.
+
+// Note that when class fields are accepted in the ECMAScript
+// standard, the target will become that year's ES20xx
+
+var x = 1;
+class C {
+    b = x; // ok
+    constructor(x: string) {
+    }
+}
+
+var y = 1;
+class D {
+    b = y; // ok
+    constructor(x: string) {
+        var y = "";
+    }
+}
+
+class E {
+    b = z; // not ok
+    constructor(z: string) {
+    }
+}