diff --git a/python/testData/copyPaste/multiLine/IndentInnerFunction1.after.py b/python/testData/copyPaste/multiLine/IndentInnerFunction1.after.py
new file mode 100644
index 000000000000..49521da959a8
--- /dev/null
+++ b/python/testData/copyPaste/multiLine/IndentInnerFunction1.after.py
@@ -0,0 +1,9 @@
+def foo(self):
+    x = 1
+    y = 2
+
+    def foo(self):
+        x = 1
+        y = 2
+
+    z = 3
\ No newline at end of file
diff --git a/python/testData/copyPaste/multiLine/IndentInnerFunction1.dst.py b/python/testData/copyPaste/multiLine/IndentInnerFunction1.dst.py
new file mode 100644
index 000000000000..713925062da8
--- /dev/null
+++ b/python/testData/copyPaste/multiLine/IndentInnerFunction1.dst.py
@@ -0,0 +1,5 @@
+def foo(self):
+    x = 1
+    y = 2
+    <caret>
+    z = 3
\ No newline at end of file
diff --git a/python/testData/copyPaste/multiLine/IndentInnerFunction1.src.py b/python/testData/copyPaste/multiLine/IndentInnerFunction1.src.py
new file mode 100644
index 000000000000..6d09083689a6
--- /dev/null
+++ b/python/testData/copyPaste/multiLine/IndentInnerFunction1.src.py
@@ -0,0 +1,4 @@
+<selection>def foo(self):
+    x = 1
+    y = 2
+</selection>
diff --git a/python/testSrc/com/jetbrains/python/PyCopyPasteTest.java b/python/testSrc/com/jetbrains/python/PyCopyPasteTest.java
index a63554e154a3..b6c67b4903a9 100644
--- a/python/testSrc/com/jetbrains/python/PyCopyPasteTest.java
+++ b/python/testSrc/com/jetbrains/python/PyCopyPasteTest.java
@@ -147,11 +147,15 @@ public class PyCopyPasteTest extends PyTestCase {
     doTestMultiLine();
   }
 
+  public void testIndentInnerFunction1() {  //PY-6887
+    doTestMultiLine();
+  }
+
   public void testIndentFunction() {
     doTestMultiLine();
   }
 
-  public void testDecreaseIndent() {
+  public void testDecreaseIndent() {    //PY-6889
     doTestMultiLine();
   }