python
@@ -694,6 +694,19 @@ class Cls:
         cls = ns["outer"]()
         self.assertEqual(cls.Alias.__value__, "class")
 
+    def test_nested_free(self):
+        ns = run_code("""
+            def f():
+                T = str
+                class C:
+                    T = int
+                    class D[U](T):
+                        x = T
+                return C
+        """)
+        C = ns["f"]()
+        self.assertIn(int, C.D.__bases__)
+        self.assertIs(C.D.x, str)
 
 class TypeParamsManglingTest(unittest.TestCase):
     def test_mangling(self):

diff --git a/Misc/NEWS.d/next/Core and Builtins/2023-09-13-08-42-45.gh-issue-109219.UiN8sc.rst b/Misc/NEWS.d/next/Core and Builtins/2023-09-13-08-42-45.gh-issue-109219.UiN8sc.rst
@@ -0,0 +1,2 @@
+Fix compiling type param scopes that use a name which is also free in an
+inner scope.
diff --git a/Python/symtable.c b/Python/symtable.c
@@ -801,8 +801,7 @@ update_symbols(PyObject *symbols, PyObject *scopes,
                the class that has the same name as a local
                or global in the class scope.
             */
-            if  (classflag &&
-                 PyLong_AS_LONG(v) & (DEF_BOUND | DEF_GLOBAL)) {
+            if  (classflag) {
                 long flags = PyLong_AS_LONG(v) | DEF_FREE_CLASS;
                 v_new = PyLong_FromLong(flags);
                 if (!v_new) {
@@ -1037,7 +1036,7 @@ analyze_block(PySTEntryObject *ste, PyObject *bound, PyObject *free,
         goto error;
     /* Records the results of the analysis in the symbol table entry */
     if (!update_symbols(ste->ste_symbols, scopes, bound, newfree, inlined_cells,
-                        ste->ste_type == ClassBlock))
+                        (ste->ste_type == ClassBlock) || ste->ste_can_see_class_scope))
         goto error;
 
     temp = PyNumber_InPlaceOr(free, newfree);
Original file line number	Diff line number	Diff line change
		@@ -0,0 +1,2 @@
		Fix compiling type param scopes that use a name which is also free in an
		inner scope.