diff --git a/java/java-impl-refactorings/src/com/intellij/refactoring/extractMethod/newImpl/ExtractOptionsPipeline.kt b/java/java-impl-refactorings/src/com/intellij/refactoring/extractMethod/newImpl/ExtractOptionsPipeline.kt
index a35dc1c24838..145fd48b3c70 100644
--- a/java/java-impl-refactorings/src/com/intellij/refactoring/extractMethod/newImpl/ExtractOptionsPipeline.kt
+++ b/java/java-impl-refactorings/src/com/intellij/refactoring/extractMethod/newImpl/ExtractOptionsPipeline.kt
@@ -2,6 +2,7 @@
 package com.intellij.refactoring.extractMethod.newImpl
 
 import com.intellij.codeInsight.AnnotationUtil.*
+import com.intellij.codeInsight.daemon.impl.analysis.HighlightingFeature
 import com.intellij.codeInsight.daemon.impl.analysis.JavaHighlightUtil
 import com.intellij.codeInsight.daemon.impl.quickfix.AnonymousTargetClassPreselectionUtil
 import com.intellij.codeInsight.navigation.PsiTargetNavigator
@@ -222,7 +223,8 @@ object ExtractMethodPipeline {
 
   fun withForcedStatic(analyzer: CodeFragmentAnalyzer, extractOptions: ExtractOptions): ExtractOptions? {
     val targetClass = PsiTreeUtil.getParentOfType(extractOptions.anchor, PsiClass::class.java)!!
-    if (PsiUtil.isLocalOrAnonymousClass(targetClass) || PsiUtil.isInnerClass(targetClass)) return null
+    val isInnerClass = PsiUtil.isLocalOrAnonymousClass(targetClass) || PsiUtil.isInnerClass(targetClass)
+    if (isInnerClass && !HighlightingFeature.INNER_STATICS.isAvailable(targetClass)) return null
     val memberUsages = analyzer.findInstanceMemberUsages(targetClass, extractOptions.elements)
     if (memberUsages.any(::isNotExtractableUsage)) return null
     val addedParameters = memberUsages.groupBy(MemberUsage::member).entries
diff --git a/java/java-tests/testData/refactoring/extractMethodAndDuplicatesInplace/MakeStaticInsideInner.java b/java/java-tests/testData/refactoring/extractMethodAndDuplicatesInplace/MakeStaticInsideInner.java
new file mode 100644
index 000000000000..39c55288103e
--- /dev/null
+++ b/java/java-tests/testData/refactoring/extractMethodAndDuplicatesInplace/MakeStaticInsideInner.java
@@ -0,0 +1,8 @@
+class X {
+    Runnable r = new Runnable() {
+        @Override
+        public void run() {
+            <selection>System.out.println("hello");</selection>
+        }
+    };
+}
\ No newline at end of file
diff --git a/java/java-tests/testData/refactoring/extractMethodAndDuplicatesInplace/MakeStaticInsideInnerFail.java b/java/java-tests/testData/refactoring/extractMethodAndDuplicatesInplace/MakeStaticInsideInnerFail.java
new file mode 100644
index 000000000000..39c55288103e
--- /dev/null
+++ b/java/java-tests/testData/refactoring/extractMethodAndDuplicatesInplace/MakeStaticInsideInnerFail.java
@@ -0,0 +1,8 @@
+class X {
+    Runnable r = new Runnable() {
+        @Override
+        public void run() {
+            <selection>System.out.println("hello");</selection>
+        }
+    };
+}
\ No newline at end of file
diff --git a/java/java-tests/testData/refactoring/extractMethodAndDuplicatesInplace/MakeStaticInsideInnerFail_after.java b/java/java-tests/testData/refactoring/extractMethodAndDuplicatesInplace/MakeStaticInsideInnerFail_after.java
new file mode 100644
index 000000000000..1bb43086c7ab
--- /dev/null
+++ b/java/java-tests/testData/refactoring/extractMethodAndDuplicatesInplace/MakeStaticInsideInnerFail_after.java
@@ -0,0 +1,12 @@
+class X {
+    Runnable r = new Runnable() {
+        @Override
+        public void run() {
+            extracted();
+        }
+
+        private void extracted() {
+            System.out.println("hello");
+        }
+    };
+}
\ No newline at end of file
diff --git a/java/java-tests/testData/refactoring/extractMethodAndDuplicatesInplace/MakeStaticInsideInner_after.java b/java/java-tests/testData/refactoring/extractMethodAndDuplicatesInplace/MakeStaticInsideInner_after.java
new file mode 100644
index 000000000000..2788dd08b79b
--- /dev/null
+++ b/java/java-tests/testData/refactoring/extractMethodAndDuplicatesInplace/MakeStaticInsideInner_after.java
@@ -0,0 +1,12 @@
+class X {
+    Runnable r = new Runnable() {
+        @Override
+        public void run() {
+            extracted();
+        }
+
+        private static void extracted() {
+            System.out.println("hello");
+        }
+    };
+}
\ No newline at end of file
diff --git a/java/java-tests/testSrc/com/intellij/java/refactoring/ExtractMethodAndDuplicatesInplaceTest.kt b/java/java-tests/testSrc/com/intellij/java/refactoring/ExtractMethodAndDuplicatesInplaceTest.kt
index d55270aa0694..da8b8d8aa645 100644
--- a/java/java-tests/testSrc/com/intellij/java/refactoring/ExtractMethodAndDuplicatesInplaceTest.kt
+++ b/java/java-tests/testSrc/com/intellij/java/refactoring/ExtractMethodAndDuplicatesInplaceTest.kt
@@ -5,9 +5,12 @@ import com.intellij.codeInsight.lookup.LookupManager
 import com.intellij.codeInsight.template.impl.TemplateManagerImpl
 import com.intellij.codeInsight.template.impl.TemplateState
 import com.intellij.ide.DataManager
+import com.intellij.ide.IdeEventQueue
+import com.intellij.ide.IdePopupManager
 import com.intellij.openapi.actionSystem.*
 import com.intellij.openapi.command.WriteCommandAction
 import com.intellij.openapi.editor.Editor
+import com.intellij.openapi.ui.popup.JBPopup
 import com.intellij.openapi.util.Disposer
 import com.intellij.openapi.util.TextRange
 import com.intellij.pom.java.LanguageLevel
@@ -20,6 +23,8 @@ import com.intellij.refactoring.listeners.RefactoringEventListener
 import com.intellij.refactoring.util.CommonRefactoringUtil.RefactoringErrorHintException
 import com.intellij.testFramework.IdeaTestUtil
 import com.intellij.testFramework.LightJavaCodeInsightTestCase
+import com.intellij.ui.UiInterceptors
+import com.intellij.ui.UiInterceptors.UiInterceptor
 import com.intellij.util.ui.UIUtil
 import org.jetbrains.annotations.NonNls
 
@@ -326,9 +331,29 @@ class ExtractMethodAndDuplicatesInplaceTest: LightJavaCodeInsightTestCase() {
   }
 
   fun testIntroduceObjectInsideNestedClass(){
+    IdeEventQueue.getInstance().popupManager.closeAllPopups()
+    IdePopupManager().closeAllPopups()
     doTest()
   }
 
+  fun testMakeStaticInsideInner(){
+    UiInterceptors.register(DefaultChooserInterceptor)
+    doTest()
+  }
+
+  fun testMakeStaticInsideInnerFail(){
+    IdeaTestUtil.withLevel(module, LanguageLevel.JDK_15) {
+      UiInterceptors.register(DefaultChooserInterceptor)
+      doTest()
+    }
+  }
+
+  object DefaultChooserInterceptor: UiInterceptor<JBPopup>(JBPopup::class.java){
+    override fun doIntercept(component: JBPopup) {
+      component.closeOk(null)
+    }
+  }
+
   fun testMakeStaticFailsWithClassUsage(){
     JavaRefactoringSettings.getInstance().EXTRACT_STATIC_METHOD_AND_PASS_FIELDS = true
     doTest()
diff --git a/java/java-tests/testSrc/com/intellij/java/refactoring/ExtractMethodNewTest.java b/java/java-tests/testSrc/com/intellij/java/refactoring/ExtractMethodNewTest.java
index 530fb28ae235..6f8e254a9ca6 100644
--- a/java/java-tests/testSrc/com/intellij/java/refactoring/ExtractMethodNewTest.java
+++ b/java/java-tests/testSrc/com/intellij/java/refactoring/ExtractMethodNewTest.java
@@ -26,6 +26,7 @@ import com.intellij.refactoring.extractMethod.PrepareFailedException;
 import com.intellij.refactoring.extractMethod.newImpl.ExtractException;
 import com.intellij.refactoring.extractMethod.newImpl.MethodExtractor;
 import com.intellij.refactoring.util.duplicates.Match;
+import com.intellij.testFramework.IdeaTestUtil;
 import com.intellij.testFramework.LightJavaCodeInsightTestCase;
 import com.intellij.util.ArrayUtilRt;
 import com.intellij.util.IncorrectOperationException;
@@ -1440,12 +1441,14 @@ public class ExtractMethodNewTest extends LightJavaCodeInsightTestCase {
   }
 
   public void testNoStaticForInnerClass() {
-    try {
-      configureByFile(BASE_PATH + getTestName(false) + ".java");
-      performExtractMethod(true, true, getEditor(), getFile(), getProject(), false, null, true, null, null, null);
-      fail("Static modifier is forbidden inside inner classes");
-    } catch (PrepareFailedException e){
-    }
+    IdeaTestUtil.withLevel(getModule(), LanguageLevel.JDK_15, () -> {
+      try {
+        configureByFile(BASE_PATH + getTestName(false) + ".java");
+        performExtractMethod(true, true, getEditor(), getFile(), getProject(), false, null, true, null, null, null);
+        fail("Static modifier is forbidden inside inner classes");
+      } catch (PrepareFailedException ignored){
+      }
+    });
   }
 
   public void testStaticForNestedClass() throws Exception {