diff --git a/java/java-impl/src/com/intellij/refactoring/util/InlineUtil.java b/java/java-impl/src/com/intellij/refactoring/util/InlineUtil.java
index 8b9aaa59dd8b..c8013ff40d3a 100644
--- a/java/java-impl/src/com/intellij/refactoring/util/InlineUtil.java
+++ b/java/java-impl/src/com/intellij/refactoring/util/InlineUtil.java
@@ -150,7 +150,8 @@ public class InlineUtil {
   }
 
   private static PsiExpression surroundWithCast(PsiVariable variable, PsiExpression expr, PsiExpression expression) {
-    if (expression.getParent() instanceof PsiReferenceExpression) {
+    final PsiElement parent = expression.getParent();
+    if (parent instanceof PsiReferenceExpression || parent instanceof PsiExpressionList) {
       PsiTypeCastExpression cast = (PsiTypeCastExpression)JavaPsiFacade.getElementFactory(expr.getProject()).createExpressionFromText("(t)a", null);
       PsiTypeElement castTypeElement = cast.getCastType();
       assert castTypeElement != null;
@@ -159,6 +160,9 @@ public class InlineUtil {
       assert operand != null;
       operand.replace(expr);
       expr = (PsiTypeCastExpression)expr.replace(cast);
+      if (RedundantCastUtil.isCastRedundant((PsiTypeCastExpression)expr)) {
+        expr = (PsiExpression)expr.replace(((PsiTypeCastExpression)expr).getOperand());
+      }
     }
     return expr;
   }
diff --git a/java/java-tests/testData/refactoring/inlineLocal/CastAroundLambda.java b/java/java-tests/testData/refactoring/inlineLocal/CastAroundLambda.java
new file mode 100644
index 000000000000..03de90ced40a
--- /dev/null
+++ b/java/java-tests/testData/refactoring/inlineLocal/CastAroundLambda.java
@@ -0,0 +1,12 @@
+class Test {
+  void test() {
+    I b1 = System::exit;
+    a(b<caret>1);
+  }
+
+  void a(Object b) {}
+
+  interface I {
+    void i(int i);
+  }
+}
diff --git a/java/java-tests/testData/refactoring/inlineLocal/CastAroundLambda.java.after b/java/java-tests/testData/refactoring/inlineLocal/CastAroundLambda.java.after
new file mode 100644
index 000000000000..3a08c908a39e
--- /dev/null
+++ b/java/java-tests/testData/refactoring/inlineLocal/CastAroundLambda.java.after
@@ -0,0 +1,11 @@
+class Test {
+  void test() {
+      a((I) System::exit);
+  }
+
+  void a(Object b) {}
+
+  interface I {
+    void i(int i);
+  }
+}
diff --git a/java/java-tests/testData/refactoring/inlineLocal/NoCastAroundLambda.java b/java/java-tests/testData/refactoring/inlineLocal/NoCastAroundLambda.java
new file mode 100644
index 000000000000..62f440a0b191
--- /dev/null
+++ b/java/java-tests/testData/refactoring/inlineLocal/NoCastAroundLambda.java
@@ -0,0 +1,12 @@
+class Test {
+  void test() {
+    I b1 = System::exit;
+    a(b<caret>1);
+  }
+
+  void a(I b) {}
+
+  interface I {
+    void i(int i);
+  }
+}
diff --git a/java/java-tests/testData/refactoring/inlineLocal/NoCastAroundLambda.java.after b/java/java-tests/testData/refactoring/inlineLocal/NoCastAroundLambda.java.after
new file mode 100644
index 000000000000..e8dea47092d7
--- /dev/null
+++ b/java/java-tests/testData/refactoring/inlineLocal/NoCastAroundLambda.java.after
@@ -0,0 +1,11 @@
+class Test {
+  void test() {
+      a(System::exit);
+  }
+
+  void a(I b) {}
+
+  interface I {
+    void i(int i);
+  }
+}
diff --git a/java/java-tests/testSrc/com/intellij/refactoring/inline/InlineLocalTest.java b/java/java-tests/testSrc/com/intellij/refactoring/inline/InlineLocalTest.java
index 7c4558026a0b..b44070e1aa91 100644
--- a/java/java-tests/testSrc/com/intellij/refactoring/inline/InlineLocalTest.java
+++ b/java/java-tests/testSrc/com/intellij/refactoring/inline/InlineLocalTest.java
@@ -184,6 +184,14 @@ public class InlineLocalTest extends LightCodeInsightTestCase {
     doTest(true);
   }
 
+  public void testCastAroundLambda() throws Exception {
+    doTest(true);
+  }
+
+  public void testNoCastAroundLambda() throws Exception {
+    doTest(true);
+  }
+
   public void testLocalVarInsideLambdaBodyWriteUsage() throws Exception {
     doTest(true, "Cannot perform refactoring.\n" +
                  "Variable 'hello' is accessed for writing.");