diff --git a/python/src/com/jetbrains/python/documentation/SphinxDocString.java b/python/src/com/jetbrains/python/documentation/SphinxDocString.java
index 53a136a3a440..3ebc8a5736d2 100644
--- a/python/src/com/jetbrains/python/documentation/SphinxDocString.java
+++ b/python/src/com/jetbrains/python/documentation/SphinxDocString.java
@@ -83,8 +83,8 @@ public class SphinxDocString extends StructuredDocString {
     if (tagEnd < 0) return index;
     String tagName = line.substring(1, tagEnd);
     String tagValue = line.substring(tagEnd).trim();
-    tagValue = tagValue.replaceAll(":py:class:", "");
-    tagValue = tagValue.replaceAll(":class:", "");
+    tagValue = StringUtil.replace(tagValue, ":py:class:", "");
+    tagValue = StringUtil.replace(tagValue, ":class:", "");
     tagValue = tagValue.replaceAll("`(\\w+)`", "$1");
     int pos = tagValue.indexOf(':');
     if (pos < 0) return index;
diff --git a/python/testSrc/com/jetbrains/python/PyTypeTest.java b/python/testSrc/com/jetbrains/python/PyTypeTest.java
index 92504ea29a1c..266d05e3d929 100644
--- a/python/testSrc/com/jetbrains/python/PyTypeTest.java
+++ b/python/testSrc/com/jetbrains/python/PyTypeTest.java
@@ -185,6 +185,12 @@ public class PyTypeTest extends PyLightFixtureTestCase {
     assertEquals("int", type.getName());
   }
 
+  public void testRestClassType() {     //PY-3849
+    PyClassType type = (PyClassType) doTest("class Foo: pass\ndef foo(limit):\n" +
+                                            "  ''':param :class:`Foo` limit: maximum number of stack frames to show'''\n" +
+                                            "  expr = limit");
+    assertEquals("Foo", type.getName());
+  }
 
   private PyType doTest(final String text) {
     myFixture.configureByText(PythonFileType.INSTANCE, text);