diff --git a/java/java-impl-refactorings/src/com/intellij/refactoring/inline/InlineLocalHandler.java b/java/java-impl-refactorings/src/com/intellij/refactoring/inline/InlineLocalHandler.java
index 6273ff8b3942..d79c9dda63d9 100644
--- a/java/java-impl-refactorings/src/com/intellij/refactoring/inline/InlineLocalHandler.java
+++ b/java/java-impl-refactorings/src/com/intellij/refactoring/inline/InlineLocalHandler.java
@@ -101,7 +101,7 @@ public final class InlineLocalHandler extends JavaInlineActionHandler {
     }
     final PsiReferenceExpression refExpr = PsiTreeUtil.getParentOfType(element, PsiReferenceExpression.class);
     InlineMode mode;
-    if (JavaRefactoringSettings.getInstance().INLINE_LOCAL_THIS) mode = InlineMode.INLINE_ONE;
+    if (refExpr != null && JavaRefactoringSettings.getInstance().INLINE_LOCAL_THIS) mode = InlineMode.INLINE_ONE;
     else mode = InlineMode.CHECK_CONFLICTS;
 
     return doInline(context, (PsiVariable)Objects.requireNonNull(context.element()), refExpr, mode);
@@ -109,11 +109,11 @@ public final class InlineLocalHandler extends JavaInlineActionHandler {
 
   private static ModCommand doInline(@NotNull ActionContext context,
                                      @NotNull PsiVariable var,
-                                     PsiReferenceExpression refExpr,
+                                     @Nullable PsiReferenceExpression refExpr,
                                      @NotNull InlineMode mode) {
     PsiElement block = PsiUtil.getVariableCodeBlock(var, null);
     List<PsiReferenceExpression> allRefs =
-      mode == InlineMode.INLINE_ONE || block == null ? List.of(refExpr) :
+      refExpr != null && (mode == InlineMode.INLINE_ONE || block == null) ? List.of(refExpr) :
       VariableAccessUtils.getVariableReferences(var, block);
     if (allRefs.isEmpty()) {
       return ModCommand.error(RefactoringBundle.message("variable.is.never.used", var.getName()));
@@ -204,7 +204,7 @@ public final class InlineLocalHandler extends JavaInlineActionHandler {
 
     List<PsiElement> refsToInlineList = new ArrayList<>();
     boolean simpleInlining = false;
-    if (mode == InlineMode.INLINE_ONE) {
+    if (mode == InlineMode.INLINE_ONE && refExpr != null) {
       refsToInlineList.add(refExpr);
     } else {
       if (defToInline == local.getInitializer()) {
diff --git a/java/java-tests/testData/refactoring/inlineLocal/LocalVariableInThisOnlyMode.java b/java/java-tests/testData/refactoring/inlineLocal/LocalVariableInThisOnlyMode.java
new file mode 100644
index 000000000000..fba2706ddf28
--- /dev/null
+++ b/java/java-tests/testData/refactoring/inlineLocal/LocalVariableInThisOnlyMode.java
@@ -0,0 +1,6 @@
+class X {
+  void foo() {
+    int <caret>x = 2;
+    System.out.println(x + x);
+  }
+}
\ No newline at end of file
diff --git a/java/java-tests/testData/refactoring/inlineLocal/LocalVariableInThisOnlyMode.java.after b/java/java-tests/testData/refactoring/inlineLocal/LocalVariableInThisOnlyMode.java.after
new file mode 100644
index 000000000000..beeda780f175
--- /dev/null
+++ b/java/java-tests/testData/refactoring/inlineLocal/LocalVariableInThisOnlyMode.java.after
@@ -0,0 +1,5 @@
+class X {
+  void foo() {
+      System.out.println(2 + 2);
+  }
+}
\ No newline at end of file
diff --git a/java/java-tests/testSrc/com/intellij/java/refactoring/inline/InlineLocalTest.java b/java/java-tests/testSrc/com/intellij/java/refactoring/inline/InlineLocalTest.java
index 644cb984561e..8c99a866f079 100644
--- a/java/java-tests/testSrc/com/intellij/java/refactoring/inline/InlineLocalTest.java
+++ b/java/java-tests/testSrc/com/intellij/java/refactoring/inline/InlineLocalTest.java
@@ -3,14 +3,13 @@ package com.intellij.java.refactoring.inline;
 
 import com.intellij.JavaTestUtil;
 import com.intellij.codeInsight.TargetElementUtil;
-import com.intellij.java.refactoring.JavaRefactoringBundle;
 import com.intellij.openapi.editor.Editor;
 import com.intellij.openapi.project.Project;
 import com.intellij.openapi.projectRoots.Sdk;
 import com.intellij.pom.java.LanguageLevel;
 import com.intellij.psi.PsiElement;
 import com.intellij.psi.PsiLocalVariable;
-import com.intellij.refactoring.RefactoringBundle;
+import com.intellij.refactoring.JavaRefactoringSettings;
 import com.intellij.refactoring.inline.InlineLocalHandler;
 import com.intellij.testFramework.IdeaTestUtil;
 import com.intellij.testFramework.LightJavaCodeInsightTestCase;
@@ -371,6 +370,17 @@ public class InlineLocalTest extends LightJavaCodeInsightTestCase {
            "Variable is used as resource reference");
   }
 
+  public void testLocalVariableInThisOnlyMode() {
+    boolean initialSetting = JavaRefactoringSettings.getInstance().INLINE_LOCAL_THIS;
+    try {
+      JavaRefactoringSettings.getInstance().INLINE_LOCAL_THIS = true;
+      doTest();
+    }
+    finally {
+      JavaRefactoringSettings.getInstance().INLINE_LOCAL_THIS = initialSetting;
+    }
+  }
+
   private void doTest() {
     doTest(LanguageLevel.JDK_1_7);
   }