@@ -236,6 +236,37 @@ This is equivalent to::
         return ((x * scale, y * scale) for x, y in v)
     vec = []  # type: Iterable[Tuple[float, float]]
 
+Simple variable assignments may be either type aliases or variables. PEP 613
+provides a way to explicitly annotate a type alias. Otherwise, the type checker
+should infer a type alias if all of the following conditions apply.
+
+- There is no type annotation provided
+- The LHS is a simple identifier symbol
+- There is only one assignment to the LHS symbol
+- The expression on the RHS of the assignment does not contain any syntactic form that would be considered illegal for a type annotation (call expressions, lambdas, comprehensions, etc.)
+- The type evaluation of the RHS evaluates to an instantiable type or a union of instantiable types
+
+Type Alias vs Variable Examples::
+
+    class Foo:
+        pass
+
+    F1: TypeAlias = Foo  # explicit PEP 613 type alias
+    F2: Type[Foo] = Foo  # explicit variable
+    F3 = Foo  # inferred as type alias
+
+    F4 = None
+    F4 = Foo  # inferred as variable
+
+    F5 = x()  # inferred as variable
+    F6 = Union[Foo, str]  # inferred as type alias
+
+    class Bar:
+        F7 = Foo  # inferred as type alias
+        def __init__(self):
+            F8 = Foo  # inferred as type alias
+            self.F9 = Foo  # inferred as variable
+
 
 Callable
 --------
@@ -2494,6 +2525,14 @@ References
    https://docs.python.org/3/reference/import.html#submodules
 
 
+Version History
+===============
+
+* 2021-11-23
+
+    * Specify Type Alias vs Variable inference rules
+
+
 Copyright
 =========
 

@@ -92,34 +92,38 @@ and ``InvalidType`` are not valid types. When the value expression is no longer
 evaluated as a global value, unactionable type errors on all usages of ``MyType``
 across the codebase can be suppressed.
 
-Scope Restrictions:
-*******************
+Scoping:
+********
+
+Implicit and explicit type aliases can be made at any scope as long as they obey
+the Type Alias vs Variable inference rules specified in PEP 484
 
 ::
 
-  x = ClassName
-  def foo() -> None:
-    x = ClassName
+  class Foo:
+    pass
 
-The outer ``x`` is a valid type alias, but type checkers must error if the
-inner ``x`` is ever used as a type because type aliases cannot be defined
-inside a nested scope.
-This is confusing because the alias declaration rule is not explicit, and because
-a type error will not be thrown on the location of the inner type alias declaration
-but rather on every one of its subsequent use cases.
+  F1 = Foo
+  class Bar:
+    F2 = Foo
+    F3: TypeAlias = Foo
+
+On explicit type aliases made on assignments that break the inference rules specified
+in PEP 484, type checkers should raise a clear error, communicating to the author
+why the TypeAlias is invalid.
 
 ::
 
-  x: TypeAlias = ClassName
-  def foo() -> None:
-    x = ClassName
-  def bar() -> None:
-    x: TypeAlias = ClassName
+  class Foo:
+    pass
+
+  F1: TypeAlias = [f for f in Foo]  # RHS not a valid type
+  F2: TypeAlias = Foo  # Multiple assignments to F2
+  F2 = None
 
-With explicit aliases, the outer assignment is still a valid type variable,
-and the inner assignment can either be a valid local variable or a clear error,
-communicating to the author that type aliases cannot be defined inside a nested
-scope.
+  class Bar:
+    def __init__(self):
+      self.F2: TypeAlias = Foo  # LHS not a simple identifier
 
 
 Specification
@@ -200,6 +204,14 @@ appealing because it still sticks with the ``MyType = int`` assignment
 syntax, and adds some information for the type checker purely as an annotation.
 
 
+Version History
+===============
+
+* 2021-11-16
+
+    * Allow TypeAlias inside class/function scope
+
+
 Copyright
 =========