diff --git a/java/java-analysis-impl/src/com/intellij/codeInspection/dataFlow/StandardInstructionVisitor.java b/java/java-analysis-impl/src/com/intellij/codeInspection/dataFlow/StandardInstructionVisitor.java
index 6d1d14de2902..06a15d328efa 100644
--- a/java/java-analysis-impl/src/com/intellij/codeInspection/dataFlow/StandardInstructionVisitor.java
+++ b/java/java-analysis-impl/src/com/intellij/codeInspection/dataFlow/StandardInstructionVisitor.java
@@ -51,7 +51,8 @@ public class StandardInstructionVisitor extends InstructionVisitor {
   private static final Object ANY_VALUE = new Object();
 
   private static final Set<String> OPTIONAL_METHOD_NAMES = ContainerUtil
-    .set("of", "ofNullable", "fromNullable", "empty", "absent", "or", "orElseGet", "ifPresent", "map", "flatMap", "filter", "transform");
+    .set("of", "ofNullable", "fromNullable", "empty", "absent", "or", "orElse", "orElseGet", "ifPresent", "map", "flatMap", "filter",
+         "transform");
   private static final CallMapper<LongRangeSet> KNOWN_METHOD_RANGES = new CallMapper<LongRangeSet>()
     .register(CallMatcher.instanceCall("java.time.LocalDateTime", "getHour"), LongRangeSet.range(0, 23))
     .register(CallMatcher.instanceCall("java.time.LocalDateTime", "getMinute", "getSecond"), LongRangeSet.range(0, 59))
@@ -276,6 +277,23 @@ public class StandardInstructionVisitor extends InstructionVisitor {
       case "absent":
         result = runner.getFactory().getOptionalFactory().getOptional(false);
         break;
+      case "orElse":
+        if (argValues != null && argValues.length == 1) {
+          switch (memState.checkOptional(qualifier)) {
+            case YES:
+              result = runner.getFactory().createTypeValue(instruction.getResultType(), Nullness.NOT_NULL);
+              break;
+            case NO:
+              result = argValues[0];
+              break;
+            case UNSURE:
+              Nullness nullness =
+                memState.isNotNull(argValues[0]) ? Nullness.NOT_NULL : memState.isNull(argValues[0]) ? Nullness.NULLABLE : Nullness.UNKNOWN;
+              result = runner.getFactory().createTypeValue(instruction.getResultType(), nullness);
+              break;
+          }
+        }
+        break;
       case "filter":
       case "flatMap":
       case "ifPresent":
diff --git a/java/java-tests/testData/inspection/dataFlow/fixture/OptionalOrElse.java b/java/java-tests/testData/inspection/dataFlow/fixture/OptionalOrElse.java
new file mode 100644
index 000000000000..8fa53bc5e1dc
--- /dev/null
+++ b/java/java-tests/testData/inspection/dataFlow/fixture/OptionalOrElse.java
@@ -0,0 +1,45 @@
+/*
+ * Copyright 2000-2017 JetBrains s.r.o.
+ *
+ * Licensed under the Apache License, Version 2.0 (the "License");
+ * you may not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ * http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing, software
+ * distributed under the License is distributed on an "AS IS" BASIS,
+ * WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+ * See the License for the specific language governing permissions and
+ * limitations under the License.
+ */
+import org.jetbrains.annotations.NotNull;
+import org.jetbrains.annotations.Nullable;
+
+import java.util.Optional;
+
+class OptionalOrElse {
+  @NotNull
+  Boolean bug(@Nullable Boolean whatever) {
+    return <warning descr="Expression 'Optional.ofNullable(whatever).orElse(null)' might evaluate to null but is returned by the method declared as @NotNull">Optional.ofNullable(whatever).orElse(null)</warning>;
+  }
+
+  @NotNull
+  String nullable(Optional<String> opt) {
+    return <warning descr="Expression 'opt.orElse(null)' might evaluate to null but is returned by the method declared as @NotNull">opt.orElse(null)</warning>;
+  }
+
+  @NotNull
+  String ok(Optional<String> opt) {
+    return opt.orElse("");
+  }
+
+  @NotNull
+  String strangeButOk(Optional<String> opt) {
+    if(opt.isPresent()) {
+      return opt.orElse(null);
+    } else {
+      return "";
+    }
+  }
+}
\ No newline at end of file
diff --git a/java/java-tests/testSrc/com/intellij/codeInspection/DataFlowInspection8Test.java b/java/java-tests/testSrc/com/intellij/codeInspection/DataFlowInspection8Test.java
index 01f7e60bf389..1f37a1ec9577 100644
--- a/java/java-tests/testSrc/com/intellij/codeInspection/DataFlowInspection8Test.java
+++ b/java/java-tests/testSrc/com/intellij/codeInspection/DataFlowInspection8Test.java
@@ -61,6 +61,7 @@ public class DataFlowInspection8Test extends DataFlowInspectionTestCase {
   public void testGenericParameterNullity() { doTestWithCustomAnnotations(); }
 
   public void testOptionalOfNullable() { doTest(); }
+  public void testOptionalOrElse() { doTest(); }
   public void testOptionalIsPresent() { doTest(); }
   public void testOptionalGetWithoutIsPresent() {
     myFixture.addClass("package org.junit;" +