diff --git a/src/scopes.cc b/src/scopes.cc
index 25873fac1d..81fb9ead18 100644
--- a/src/scopes.cc
+++ b/src/scopes.cc
@@ -540,11 +540,11 @@ Variable* Scope::NonLocal(Handle<String> name, Variable::Mode mode) {
 
 
 // Lookup a variable starting with this scope. The result is either
-// the statically resolved (local!) variable belonging to an outer scope,
-// or NULL. It may be NULL because a) we couldn't find a variable, or b)
-// because the variable is just a guess (and may be shadowed by another
-// variable that is introduced dynamically via an 'eval' call or a 'with'
-// statement).
+// the statically resolved variable belonging to an outer scope, or
+// NULL. It may be NULL because a) we couldn't find a variable, or b)
+// because the variable is just a guess (and may be shadowed by
+// another variable that is introduced dynamically via an 'eval' call
+// or a 'with' statement).
 Variable* Scope::LookupRecursive(Handle<String> name,
                                  bool inner_lookup,
                                  Variable** invalidated_local) {
@@ -598,9 +598,11 @@ Variable* Scope::LookupRecursive(Handle<String> name,
   if (inner_lookup)
     var->is_accessed_from_inner_scope_ = true;
 
-  // If the variable we have found is just a guess, invalidate the result.
+  // If the variable we have found is just a guess, invalidate the
+  // result. If the found variable is local, record that fact so we
+  // can generate fast code to get it if it is not shadowed by eval.
   if (guess) {
-    *invalidated_local = var;
+    if (!var->is_global()) *invalidated_local = var;
     var = NULL;
   }
 
diff --git a/test/mjsunit/regress/regress-496.js b/test/mjsunit/regress/regress-496.js
new file mode 100644
index 0000000000..33c1a677eb
--- /dev/null
+++ b/test/mjsunit/regress/regress-496.js
@@ -0,0 +1,39 @@
+// Copyright 2009 the V8 project authors. All rights reserved.
+// Redistribution and use in source and binary forms, with or without
+// modification, are permitted provided that the following conditions are
+// met:
+//
+//     * Redistributions of source code must retain the above copyright
+//       notice, this list of conditions and the following disclaimer.
+//     * Redistributions in binary form must reproduce the above
+//       copyright notice, this list of conditions and the following
+//       disclaimer in the documentation and/or other materials provided
+//       with the distribution.
+//     * Neither the name of Google Inc. nor the names of its
+//       contributors may be used to endorse or promote products derived
+//       from this software without specific prior written permission.
+//
+// THIS SOFTWARE IS PROVIDED BY THE COPYRIGHT HOLDERS AND CONTRIBUTORS
+// "AS IS" AND ANY EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT
+// LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR
+// A PARTICULAR PURPOSE ARE DISCLAIMED. IN NO EVENT SHALL THE COPYRIGHT
+// OWNER OR CONTRIBUTORS BE LIABLE FOR ANY DIRECT, INDIRECT, INCIDENTAL,
+// SPECIAL, EXEMPLARY, OR CONSEQUENTIAL DAMAGES (INCLUDING, BUT NOT
+// LIMITED TO, PROCUREMENT OF SUBSTITUTE GOODS OR SERVICES; LOSS OF USE,
+// DATA, OR PROFITS; OR BUSINESS INTERRUPTION) HOWEVER CAUSED AND ON ANY
+// THEORY OF LIABILITY, WHETHER IN CONTRACT, STRICT LIABILITY, OR TORT
+// (INCLUDING NEGLIGENCE OR OTHERWISE) ARISING IN ANY WAY OUT OF THE USE
+// OF THIS SOFTWARE, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGE.
+
+// Regression test for http://code.google.com/p/v8/issues/detail?id=496.
+//
+// Tests that we do not treat the unaliased eval call in g as an
+// aliased call to eval.
+
+function h() {
+  function f() { return eval; }
+  function g() { var x = 44; return eval("x"); }
+  assertEquals(44, g());
+}
+
+h();