diff --git a/python/python-psi-impl/src/com/jetbrains/python/psi/impl/references/PyReferenceImpl.java b/python/python-psi-impl/src/com/jetbrains/python/psi/impl/references/PyReferenceImpl.java
index 8011fbdeee16..3d55548ff32d 100644
--- a/python/python-psi-impl/src/com/jetbrains/python/psi/impl/references/PyReferenceImpl.java
+++ b/python/python-psi-impl/src/com/jetbrains/python/psi/impl/references/PyReferenceImpl.java
@@ -561,7 +561,7 @@ public class PyReferenceImpl implements PsiReferenceEx, PsiPolyVariantReference
     final PsiElement ourContainer = findContainer(getElement());
     final PsiElement theirContainer = findContainer(element);
     if (ourContainer != null) {
-      if (ourContainer == theirContainer) {
+      if (ourContainer == theirContainer && ourScopeOwner == theirScopeOwner) {
         return true;
       }
       if (PsiTreeUtil.isAncestor(theirContainer, ourContainer, true)) {
diff --git a/python/testData/refactoring/rename/renameParameterWithDecorator.py b/python/testData/refactoring/rename/renameParameterWithDecorator.py
new file mode 100644
index 000000000000..ce00c3238c8d
--- /dev/null
+++ b/python/testData/refactoring/rename/renameParameterWithDecorator.py
@@ -0,0 +1,22 @@
+from functools import wraps
+
+
+def d(x):
+    def dec(f):
+        @wraps(f)
+        def wrapper(*args, **kwargs):
+            print(f'x = {x}')
+            return f(*args, **kwargs)
+        return wrapper
+    return dec
+
+
+class C:
+    foo = 0
+
+    @d(foo)  # 2. This is renamed either but it shouldn't
+    def f(self, <caret>foo):  # 1. Rename this 'foo' to 'bar'
+        print(foo)
+
+
+C().f(1)
\ No newline at end of file
diff --git a/python/testData/refactoring/rename/renameParameterWithDecorator_after.py b/python/testData/refactoring/rename/renameParameterWithDecorator_after.py
new file mode 100644
index 000000000000..2281bc46349d
--- /dev/null
+++ b/python/testData/refactoring/rename/renameParameterWithDecorator_after.py
@@ -0,0 +1,22 @@
+from functools import wraps
+
+
+def d(x):
+    def dec(f):
+        @wraps(f)
+        def wrapper(*args, **kwargs):
+            print(f'x = {x}')
+            return f(*args, **kwargs)
+        return wrapper
+    return dec
+
+
+class C:
+    foo = 0
+
+    @d(foo)  # 2. This is renamed either but it shouldn't
+    def f(self, bar):  # 1. Rename this 'foo' to 'bar'
+        print(bar)
+
+
+C().f(1)
\ No newline at end of file
diff --git a/python/testSrc/com/jetbrains/python/refactoring/PyRenameTest.java b/python/testSrc/com/jetbrains/python/refactoring/PyRenameTest.java
index ed476a3a8fa6..63a6b7094992 100644
--- a/python/testSrc/com/jetbrains/python/refactoring/PyRenameTest.java
+++ b/python/testSrc/com/jetbrains/python/refactoring/PyRenameTest.java
@@ -43,6 +43,10 @@ public class PyRenameTest extends PyTestCase {
     doTest("qu");
   }
 
+  public void testRenameParameterWithDecorator() { // PY-11858
+    doTest("bar");
+  }
+
   public void testRenameMultipleDefinitionsLocal() {  // PY-727
     doTest("qu");
   }