diff --git a/tests/baselines/reference/inferTypesWithExtendsDependingOnTypeVariables.symbols b/tests/baselines/reference/inferTypesWithExtendsDependingOnTypeVariables.symbols
new file mode 100644
index 0000000000000..20a17c8c279af
--- /dev/null
+++ b/tests/baselines/reference/inferTypesWithExtendsDependingOnTypeVariables.symbols
@@ -0,0 +1,18 @@
+//// [tests/cases/conformance/types/conditional/inferTypesWithExtendsDependingOnTypeVariables.ts] ////
+
+=== inferTypesWithExtendsDependingOnTypeVariables.ts ===
+// repro from https://github.com/microsoft/TypeScript/issues/54197
+
+type Bar<K, T extends readonly unknown[]> = T extends readonly [any, ...infer X extends readonly K[]] ? X : never;
+>Bar : Symbol(Bar, Decl(inferTypesWithExtendsDependingOnTypeVariables.ts, 0, 0))
+>K : Symbol(K, Decl(inferTypesWithExtendsDependingOnTypeVariables.ts, 2, 9))
+>T : Symbol(T, Decl(inferTypesWithExtendsDependingOnTypeVariables.ts, 2, 11))
+>T : Symbol(T, Decl(inferTypesWithExtendsDependingOnTypeVariables.ts, 2, 11))
+>X : Symbol(X, Decl(inferTypesWithExtendsDependingOnTypeVariables.ts, 2, 77))
+>K : Symbol(K, Decl(inferTypesWithExtendsDependingOnTypeVariables.ts, 2, 9))
+>X : Symbol(X, Decl(inferTypesWithExtendsDependingOnTypeVariables.ts, 2, 77))
+
+type Res1 = Bar<"a" | "b", ["a", "b", "b"]>
+>Res1 : Symbol(Res1, Decl(inferTypesWithExtendsDependingOnTypeVariables.ts, 2, 114))
+>Bar : Symbol(Bar, Decl(inferTypesWithExtendsDependingOnTypeVariables.ts, 0, 0))
+
diff --git a/tests/baselines/reference/inferTypesWithExtendsDependingOnTypeVariables.types b/tests/baselines/reference/inferTypesWithExtendsDependingOnTypeVariables.types
new file mode 100644
index 0000000000000..d891ae6597fca
--- /dev/null
+++ b/tests/baselines/reference/inferTypesWithExtendsDependingOnTypeVariables.types
@@ -0,0 +1,13 @@
+//// [tests/cases/conformance/types/conditional/inferTypesWithExtendsDependingOnTypeVariables.ts] ////
+
+=== inferTypesWithExtendsDependingOnTypeVariables.ts ===
+// repro from https://github.com/microsoft/TypeScript/issues/54197
+
+type Bar<K, T extends readonly unknown[]> = T extends readonly [any, ...infer X extends readonly K[]] ? X : never;
+>Bar : Bar<K, T>
+>    : ^^^^^^^^^
+
+type Res1 = Bar<"a" | "b", ["a", "b", "b"]>
+>Res1 : ["b", "b"]
+>     : ^^^^^^^^^^
+
diff --git a/tests/cases/conformance/types/conditional/inferTypesWithExtendsDependingOnTypeVariables.ts b/tests/cases/conformance/types/conditional/inferTypesWithExtendsDependingOnTypeVariables.ts
new file mode 100644
index 0000000000000..9deb9e41f1cc3
--- /dev/null
+++ b/tests/cases/conformance/types/conditional/inferTypesWithExtendsDependingOnTypeVariables.ts
@@ -0,0 +1,7 @@
+// @strict: true
+// @noEmit: true
+
+// repro from https://github.com/microsoft/TypeScript/issues/54197
+
+type Bar<K, T extends readonly unknown[]> = T extends readonly [any, ...infer X extends readonly K[]] ? X : never;
+type Res1 = Bar<"a" | "b", ["a", "b", "b"]>