diff --git a/platform/xdebugger-impl/src/com/intellij/xdebugger/impl/ui/tree/actions/EvaluateInConsoleFromTreeAction.java b/platform/xdebugger-impl/src/com/intellij/xdebugger/impl/ui/tree/actions/EvaluateInConsoleFromTreeAction.java
index 5bff527452c4..8f515ee5907e 100644
--- a/platform/xdebugger-impl/src/com/intellij/xdebugger/impl/ui/tree/actions/EvaluateInConsoleFromTreeAction.java
+++ b/platform/xdebugger-impl/src/com/intellij/xdebugger/impl/ui/tree/actions/EvaluateInConsoleFromTreeAction.java
@@ -14,6 +14,17 @@ class EvaluateInConsoleFromTreeAction extends XAddToWatchesAction {
     return super.isEnabled(node, e) && getConsoleExecuteAction(e) != null;
   }
 
+  @Override
+  public void update(AnActionEvent e) {
+    if (getConsoleExecuteAction(e) != null) {
+      e.getPresentation().setVisible(true);
+      super.update(e);
+    }
+    else {
+      e.getPresentation().setEnabledAndVisible(false);
+    }
+  }
+
   @Nullable
   private static ConsoleExecuteAction getConsoleExecuteAction(@NotNull AnActionEvent e) {
     return XEvaluateInConsoleFromEditorActionHandler.getConsoleExecuteAction(e.getData(LangDataKeys.CONSOLE_VIEW));
diff --git a/python/src/com/jetbrains/python/validation/ReturnAnnotator.java b/python/src/com/jetbrains/python/validation/ReturnAnnotator.java
index 93a877b9aebb..b23cb8c709ba 100644
--- a/python/src/com/jetbrains/python/validation/ReturnAnnotator.java
+++ b/python/src/com/jetbrains/python/validation/ReturnAnnotator.java
@@ -16,28 +16,25 @@
 package com.jetbrains.python.validation;
 
 import com.intellij.psi.util.PsiTreeUtil;
+import com.jetbrains.python.codeInsight.controlflow.ScopeOwner;
+import com.jetbrains.python.codeInsight.dataflow.scope.ScopeUtil;
 import com.jetbrains.python.psi.*;
 
 /**
- * Highlights incorrect return statements: 'return' and 'yield' outside functions, returning values from generators;
+ * Highlights incorrect return statements: 'return' and 'yield' outside functions, returning values from generators.
  */
 public class ReturnAnnotator extends PyAnnotator {
   public void visitPyReturnStatement(final PyReturnStatement node) {
     PyFunction function = PsiTreeUtil.getParentOfType(node, PyFunction.class, false, PyClass.class);
     if (function == null) {
       getHolder().createErrorAnnotation(node, "'return' outside of function");
-      return;
     }
   }
 
   public void visitPyYieldExpression(final PyYieldExpression node) {
-    if (PsiTreeUtil.getParentOfType(node, PyFunction.class, false, PyClass.class) == null) {
+    final ScopeOwner owner = ScopeUtil.getScopeOwner(node);
+    if (!(owner instanceof PyFunction || owner instanceof PyLambdaExpression)) {
       getHolder().createErrorAnnotation(node, "'yield' outside of function");
     }
-    /* this is now allowed in python 2.5
-    if (node.getContainingElement(PyTryFinallyStatement.class) != null) {
-      getHolder().createErrorAnnotation(node, "'yield' not allowed in a 'try' block with a 'finally' clause");
-    }
-    */
   }
 }
diff --git a/python/testData/highlighting/yieldInDefaultValue.py b/python/testData/highlighting/yieldInDefaultValue.py
new file mode 100644
index 000000000000..1d2482c35714
--- /dev/null
+++ b/python/testData/highlighting/yieldInDefaultValue.py
@@ -0,0 +1,2 @@
+def f(x=(<error descr="'yield' outside of function">yield 10</error>)):
+    return x
diff --git a/python/testData/highlighting/yieldInLambda.py b/python/testData/highlighting/yieldInLambda.py
new file mode 100644
index 000000000000..72ecd04afc2e
--- /dev/null
+++ b/python/testData/highlighting/yieldInLambda.py
@@ -0,0 +1 @@
+g = lambda: (yield 10)
diff --git a/python/testSrc/com/jetbrains/python/PythonHighlightingTest.java b/python/testSrc/com/jetbrains/python/PythonHighlightingTest.java
index 77246ba93004..e1fa67de63e4 100644
--- a/python/testSrc/com/jetbrains/python/PythonHighlightingTest.java
+++ b/python/testSrc/com/jetbrains/python/PythonHighlightingTest.java
@@ -110,6 +110,15 @@ public class PythonHighlightingTest extends PyTestCase {
   public void testYieldOutsideOfFunction() {
     doTest(LanguageLevel.PYTHON27, true, true);
   }
+
+  public void testYieldInDefaultValue() {
+    doTest(LanguageLevel.PYTHON34, true, false);
+  }
+
+  // PY-11663
+  public void testYieldInLambda() {
+    doTest();
+  }
   
   public void testImportStarAtTopLevel() {
     doTest(true, false);