diff --git a/java/java-tests/testSrc/com/intellij/codeInsight/template/LiveTemplateTest.groovy b/java/java-tests/testSrc/com/intellij/codeInsight/template/LiveTemplateTest.groovy
index 31a483984333..f196fbbf025c 100644
--- a/java/java-tests/testSrc/com/intellij/codeInsight/template/LiveTemplateTest.groovy
+++ b/java/java-tests/testSrc/com/intellij/codeInsight/template/LiveTemplateTest.groovy
@@ -310,9 +310,14 @@ public class LiveTemplateTest extends LightCodeInsightFixtureTestCase {
     
     myFixture.type('it')
     assert myFixture.lookupElementStrings[0].startsWith('it')
+    assert LookupManager.getInstance(project).activeLookup.currentItem == myFixture.getLookupElements()[0]
+
+    myFixture.type('e')
+    assert myFixture.lookupElementStrings[0].startsWith('ite')
+    assert LookupManager.getInstance(project).activeLookup.currentItem == myFixture.getLookupElements()[0]
     LookupManager.getInstance(project).hideActiveLookup()
 
-    myFixture.type('\b')
+    myFixture.type('\b\b')
     new ListTemplatesHandler().invoke(project, editor, myFixture.file);
     assert myFixture.lookupElementStrings.containsAll(['iter', 'itco'])
     LookupManager.getInstance(project).hideActiveLookup()
diff --git a/platform/lang-impl/src/com/intellij/codeInsight/template/impl/ListTemplatesHandler.java b/platform/lang-impl/src/com/intellij/codeInsight/template/impl/ListTemplatesHandler.java
index f824802af91c..1778d0c1a6ae 100644
--- a/platform/lang-impl/src/com/intellij/codeInsight/template/impl/ListTemplatesHandler.java
+++ b/platform/lang-impl/src/com/intellij/codeInsight/template/impl/ListTemplatesHandler.java
@@ -190,7 +190,7 @@ public class ListTemplatesHandler implements CodeInsightActionHandler {
       }
       result.addAll(items);
       ArrayList<LookupElement> list = new ArrayList<LookupElement>(result);
-      int selected = list.indexOf(lookup.getCurrentItem());
+      int selected = lookup.isSelectionTouched() ? list.indexOf(lookup.getCurrentItem()) : 0;
       return new Pair<List<LookupElement>, Integer>(list, selected >= 0 ? selected : 0);
     }