diff --git a/compiler/src/dotty/tools/dotc/core/Types.scala b/compiler/src/dotty/tools/dotc/core/Types.scala
index adf375344537..04dfbbb26ef7 100644
--- a/compiler/src/dotty/tools/dotc/core/Types.scala
+++ b/compiler/src/dotty/tools/dotc/core/Types.scala
@@ -5577,6 +5577,16 @@ object Types {
         else None
       }
       else None
+
+    def isSamCompatible(lhs: Type, rhs: Type)(using Context): Boolean = rhs match
+      case SAMType(mt) if !isParamDependentRec(mt) =>
+        lhs <:< mt.toFunctionType(isJava = rhs.classSymbol.is(JavaDefined))
+      case _ => false
+
+    def isParamDependentRec(mt: MethodType)(using Context): Boolean =
+      mt.isParamDependent || mt.resultType.match
+        case mt: MethodType => isParamDependentRec(mt)
+        case _              => false
   }
 
   // ----- TypeMaps --------------------------------------------------------------------
diff --git a/compiler/src/dotty/tools/dotc/typer/Applications.scala b/compiler/src/dotty/tools/dotc/typer/Applications.scala
index fbed4b77d3fe..17b79ab0f801 100644
--- a/compiler/src/dotty/tools/dotc/typer/Applications.scala
+++ b/compiler/src/dotty/tools/dotc/typer/Applications.scala
@@ -695,9 +695,7 @@ trait Applications extends Compatibility {
         val argtpe1 = argtpe.widen
 
         def SAMargOK =
-          defn.isFunctionType(argtpe1) && formal.match
-            case SAMType(sam) => argtpe <:< sam.toFunctionType(isJava = formal.classSymbol.is(JavaDefined))
-            case _ => false
+          defn.isFunctionType(argtpe1) && SAMType.isSamCompatible(argtpe, formal)
 
         isCompatible(argtpe, formal)
         // Only allow SAM-conversion to PartialFunction if implicit conversions
diff --git a/compiler/src/dotty/tools/dotc/typer/Typer.scala b/compiler/src/dotty/tools/dotc/typer/Typer.scala
index cb23262d1410..458e60ddfa38 100644
--- a/compiler/src/dotty/tools/dotc/typer/Typer.scala
+++ b/compiler/src/dotty/tools/dotc/typer/Typer.scala
@@ -1324,7 +1324,10 @@ class Typer(@constructorOnly nestingLevel: Int = 0) extends Namer
         case RefinedType(parent, nme.apply, mt @ MethodTpe(_, formals, restpe))
         if (defn.isNonRefinedFunction(parent) || defn.isErasedFunctionType(parent)) && formals.length == defaultArity =>
           (formals, untpd.DependentTypeTree(syms => restpe.substParams(mt, syms.map(_.termRef))))
-        case SAMType(mt @ MethodTpe(_, formals, restpe)) =>
+        case pt1 @ SAMType(mt @ MethodTpe(_, formals, _)) if !SAMType.isParamDependentRec(mt) =>
+          val restpe = mt.resultType match
+            case mt: MethodType => mt.toFunctionType(isJava = pt1.classSymbol.is(JavaDefined))
+            case tp => tp
           (formals,
            if (mt.isResultDependent)
              untpd.DependentTypeTree(syms => restpe.substParams(mt, syms.map(_.termRef)))
@@ -4115,17 +4118,12 @@ class Typer(@constructorOnly nestingLevel: Int = 0) extends Namer
       // convert function literal to SAM closure
       tree match {
         case closure(Nil, id @ Ident(nme.ANON_FUN), _)
-        if defn.isFunctionType(wtp) && !defn.isFunctionType(pt) =>
-          pt match {
-            case SAMType(sam)
-            if wtp <:< sam.toFunctionType(isJava = pt.classSymbol.is(JavaDefined)) =>
-              // was ... && isFullyDefined(pt, ForceDegree.flipBottom)
-              // but this prevents case blocks from implementing polymorphic partial functions,
-              // since we do not know the result parameter a priori. Have to wait until the
-              // body is typechecked.
-              return toSAM(tree)
-            case _ =>
-          }
+        if defn.isFunctionType(wtp) && !defn.isFunctionType(pt) && SAMType.isSamCompatible(wtp, pt) =>
+          // was ... && isFullyDefined(pt, ForceDegree.flipBottom)
+          // but this prevents case blocks from implementing polymorphic partial functions,
+          // since we do not know the result parameter a priori. Have to wait until the
+          // body is typechecked.
+          return toSAM(tree)
         case _ =>
       }
 
diff --git a/tests/neg/i17183.check b/tests/neg/i17183.check
new file mode 100644
index 000000000000..37e0c5fd75c2
--- /dev/null
+++ b/tests/neg/i17183.check
@@ -0,0 +1,14 @@
+-- [E081] Type Error: tests/neg/i17183.scala:11:24 ---------------------------------------------------------------------
+11 |def test = Context(f = (_, _) => ???) // error // error
+   |                        ^
+   |                        Missing parameter type
+   |
+   |                        I could not infer the type of the parameter _$1 of expanded function:
+   |                        (_$1, _$2) => ???.
+-- [E081] Type Error: tests/neg/i17183.scala:11:27 ---------------------------------------------------------------------
+11 |def test = Context(f = (_, _) => ???) // error // error
+   |                           ^
+   |                           Missing parameter type
+   |
+   |                           I could not infer the type of the parameter _$2 of expanded function:
+   |                           (_$1, _$2) => ???.
diff --git a/tests/neg/i17183.scala b/tests/neg/i17183.scala
new file mode 100644
index 000000000000..a7d2d51c5935
--- /dev/null
+++ b/tests/neg/i17183.scala
@@ -0,0 +1,11 @@
+trait Dependency {
+  trait More
+}
+
+trait MyFunc {
+  def apply(a: Int, b: String)(using dep: Dependency, more: dep.More): String
+}
+
+case class Context(f: MyFunc)
+
+def test = Context(f = (_, _) => ???) // error // error
diff --git a/tests/pos/i17183.scala b/tests/pos/i17183.scala
new file mode 100644
index 000000000000..b53a2b138985
--- /dev/null
+++ b/tests/pos/i17183.scala
@@ -0,0 +1,9 @@
+trait Dependency
+
+trait MyFunc {
+  def apply(a: Int, b: String)(using Dependency): String
+}
+
+case class Context(f: MyFunc)
+
+def test = Context(f = (_, _) => ???)