diff --git a/src/testdir/test_vim9_func.vim b/src/testdir/test_vim9_func.vim
index e8df8a7..144797e 100644
--- a/src/testdir/test_vim9_func.vim
+++ b/src/testdir/test_vim9_func.vim
@@ -2352,7 +2352,7 @@
   assert_match('def <lambda>\d\+(_: any): number\n1  return 0\n   enddef', body)
 enddef
 
-def Test_lamba_block_variable()
+def Test_lambda_block_variable()
   var lines =<< trim END
       vim9script
       var flist: list<func>
@@ -2386,6 +2386,15 @@
       endfor
   END
   CheckScriptFailure(lines, 'E1001: Variable not found: outloop', 1)
+
+  lines =<< trim END
+      vim9script
+      for i in range(10)
+        var Ref = () => 0
+      endfor
+      assert_equal(0, ((i) => 0)(0))
+  END
+  CheckScriptSuccess(lines)
 enddef
 
 def Test_legacy_lambda()
diff --git a/src/version.c b/src/version.c
index 7d66d8b..f8a3ee4 100644
--- a/src/version.c
+++ b/src/version.c
@@ -756,6 +756,8 @@
 static int included_patches[] =
 {   /* Add new patch number below this line */
 /**/
+    3222,
+/**/
     3221,
 /**/
     3220,
diff --git a/src/vim9compile.c b/src/vim9compile.c
index 2df5ff4..62d7373 100644
--- a/src/vim9compile.c
+++ b/src/vim9compile.c
@@ -355,10 +355,23 @@
 	return NULL;
 
     sav = HI2SAV(hi);
-    if (sav->sav_block_id == 0 || cctx == NULL)
-	// variable defined in the script scope or not in a function.
+    if (sav->sav_block_id == 0)
+	// variable defined in the top script scope is always visible
 	return sav;
 
+    if (cctx == NULL)
+    {
+	// Not in a function scope, find variable with block id equal to or
+	// smaller than the current block id.
+	while (sav != NULL)
+	{
+	    if (sav->sav_block_id <= si->sn_current_block_id)
+		break;
+	    sav = sav->sav_next;
+	}
+	return sav;
+    }
+
     // Go over the variables with this name and find one that was visible
     // from the function.
     ufunc = cctx->ctx_ufunc;