diff --git a/gcc/cp/ChangeLog b/gcc/cp/ChangeLog
index 15bf1a6f0c7..a18706b38c4 100644
--- a/gcc/cp/ChangeLog
+++ b/gcc/cp/ChangeLog
@@ -1,3 +1,9 @@
+2003-09-19  Kriang Lerdsuwanakij  <lerdsuwa@users.sourceforge.net>
+
+	PR c++/495
+	* pt.c (tsubst_friend_class): Only use innermost template
+	arguments for the injected friend class template.
+
 2003-09-19  Nathan Sidwell  <nathan@codesourcery.com>
 
 	PR c++/12332
diff --git a/gcc/cp/pt.c b/gcc/cp/pt.c
index 28ed0bcd232..5e5af5b4c48 100644
--- a/gcc/cp/pt.c
+++ b/gcc/cp/pt.c
@@ -5001,6 +5001,8 @@ tsubst_friend_class (tree friend_tmpl, tree args)
       DECL_USE_TEMPLATE (tmpl) = 0;
       DECL_TEMPLATE_INFO (tmpl) = NULL_TREE;
       CLASSTYPE_USE_TEMPLATE (TREE_TYPE (tmpl)) = 0;
+      CLASSTYPE_TI_ARGS (TREE_TYPE (tmpl))
+	= INNERMOST_TEMPLATE_ARGS (CLASSTYPE_TI_ARGS (TREE_TYPE (tmpl)));
 
       /* Inject this template into the global scope.  */
       friend_type = TREE_TYPE (pushdecl_top_level (tmpl));
diff --git a/gcc/testsuite/ChangeLog b/gcc/testsuite/ChangeLog
index 2b1e5663464..77a2c4bd7aa 100644
--- a/gcc/testsuite/ChangeLog
+++ b/gcc/testsuite/ChangeLog
@@ -1,3 +1,8 @@
+2003-09-19  Kriang Lerdsuwanakij  <lerdsuwa@users.sourceforge.net>
+
+	PR c++/495
+	* g++.dg/template/friend24.C: New test.
+
 2003-09-19  Nathan Sidwell  <nathan@codesourcery.com>
 
 	PR c++/12332
diff --git a/gcc/testsuite/g++.dg/template/friend24.C b/gcc/testsuite/g++.dg/template/friend24.C
new file mode 100644
index 00000000000..5db4d31e721
--- /dev/null
+++ b/gcc/testsuite/g++.dg/template/friend24.C
@@ -0,0 +1,27 @@
+// { dg-do compile }
+
+// Origin: Wolfgang Bangerth <bangerth@ticam.utexas.edu>
+
+// PR c++/495: Fail to locate primary class template that is
+// injected by friend declaration.
+
+template <int N> struct X
+{
+  template <int dim> friend struct Y;
+};
+
+X<2> x;
+
+template <int dim> struct Y
+{
+  void f (Y);
+  void g (Y);
+};
+
+template <int dim> void Y<dim>::f (Y)
+{
+}
+
+template <int dim> void Y<dim>::g (Y<dim>)
+{
+}