diff --git a/gcc/cp/ChangeLog b/gcc/cp/ChangeLog
index 8efaa80b344..5a9ad978d83 100644
--- a/gcc/cp/ChangeLog
+++ b/gcc/cp/ChangeLog
@@ -1,3 +1,9 @@
+2016-04-21  Paolo Carlini  <paolo.carlini@oracle.com>
+
+	PR c++/70540
+	* semantics.c (process_outer_var_ref): Unconditionally return
+	error_mark_node when mark_used returns false.
+
 2016-04-21  Marek Polacek  <polacek@redhat.com>
 
 	PR c++/70513
diff --git a/gcc/cp/semantics.c b/gcc/cp/semantics.c
index 93b39ac9a77..2365a732cbe 100644
--- a/gcc/cp/semantics.c
+++ b/gcc/cp/semantics.c
@@ -3281,7 +3281,7 @@ process_outer_var_ref (tree decl, tsubst_flags_t complain)
   tree initializer = convert_from_reference (decl);
 
   /* Mark it as used now even if the use is ill-formed.  */
-  if (!mark_used (decl, complain) && !(complain & tf_error))
+  if (!mark_used (decl, complain))
     return error_mark_node;
 
   bool saw_generic_lambda = false;
diff --git a/gcc/testsuite/ChangeLog b/gcc/testsuite/ChangeLog
index 52257e5bd8a..0227f70243b 100644
--- a/gcc/testsuite/ChangeLog
+++ b/gcc/testsuite/ChangeLog
@@ -1,3 +1,8 @@
+2016-04-21  Paolo Carlini  <paolo.carlini@oracle.com>
+
+	PR c++/70540
+	* g++.dg/cpp0x/auto48.C: New.
+
 2016-04-21  Marek Polacek  <polacek@redhat.com>
 
 	PR c++/70513
diff --git a/gcc/testsuite/g++.dg/cpp0x/auto48.C b/gcc/testsuite/g++.dg/cpp0x/auto48.C
new file mode 100644
index 00000000000..3e0b9ff601e
--- /dev/null
+++ b/gcc/testsuite/g++.dg/cpp0x/auto48.C
@@ -0,0 +1,8 @@
+// PR c++/70540
+// { dg-do compile { target c++11 } }
+
+void
+foo ()
+{
+  auto f = [&] { return f; };  // { dg-error "before deduction" }
+}