diff --git a/compiler/rustc_hir_typeck/src/fn_ctxt/_impl.rs b/compiler/rustc_hir_typeck/src/fn_ctxt/_impl.rs
index 150e917c73988..ebddf4e04f145 100644
--- a/compiler/rustc_hir_typeck/src/fn_ctxt/_impl.rs
+++ b/compiler/rustc_hir_typeck/src/fn_ctxt/_impl.rs
@@ -130,7 +130,11 @@ impl<'a, 'tcx> FnCtxt<'a, 'tcx> {
 
     pub fn local_ty(&self, span: Span, nid: hir::HirId) -> LocalTy<'tcx> {
         self.locals.borrow().get(&nid).cloned().unwrap_or_else(|| {
-            span_bug!(span, "no type for local variable {}", self.tcx.hir().node_to_string(nid))
+            let err = self.tcx.ty_error_with_message(
+                span,
+                &format!("no type for local variable {}", self.tcx.hir().node_to_string(nid)),
+            );
+            LocalTy { decl_ty: err, revealed_ty: err }
         })
     }
 
diff --git a/src/test/ui/typeck/issue-106030.rs b/src/test/ui/typeck/issue-106030.rs
new file mode 100644
index 0000000000000..8652d237a5719
--- /dev/null
+++ b/src/test/ui/typeck/issue-106030.rs
@@ -0,0 +1,5 @@
+fn main() {
+    unknown(1, |glyf| { //~ ERROR: cannot find function `unknown` in this scope
+        let actual = glyf;
+    });
+}
diff --git a/src/test/ui/typeck/issue-106030.stderr b/src/test/ui/typeck/issue-106030.stderr
new file mode 100644
index 0000000000000..666dca01b373d
--- /dev/null
+++ b/src/test/ui/typeck/issue-106030.stderr
@@ -0,0 +1,9 @@
+error[E0425]: cannot find function `unknown` in this scope
+  --> $DIR/issue-106030.rs:2:5
+   |
+LL |     unknown(1, |glyf| {
+   |     ^^^^^^^ not found in this scope
+
+error: aborting due to previous error
+
+For more information about this error, try `rustc --explain E0425`.