diff --git a/src/compiler/checker.ts b/src/compiler/checker.ts
index da1af15dfa458..0cb09dfeae41c 100644
--- a/src/compiler/checker.ts
+++ b/src/compiler/checker.ts
@@ -11985,9 +11985,36 @@ namespace ts {
                                 }
                                 return Ternary.False;
                             }
-                            const related = isRelatedTo(getTypeOfSymbol(sourceProp), getTypeOfSymbol(targetProp), reportErrors);
+
+                            const sourceType = getTypeOfSymbol(sourceProp);
+                            const targetType = getTypeOfSymbol(targetProp);
+                            const related = isRelatedTo(sourceType, targetType, reportErrors);
                             if (!related) {
                                 if (reportErrors) {
+                                    if (sourceProp.valueDeclaration && isLiteralType(targetType) && isPropertyAssignment(sourceProp.valueDeclaration) && sourceProp.valueDeclaration.initializer) {
+                                        const variableLikeDeclaration = findAncestor(sourceProp.valueDeclaration.parent, element => {
+                                            if (isParenthesizedExpression(element) || isPropertyAssignment(element) || isObjectLiteralExpression(element)) return false;
+                                            if (isVariableDeclaration(element)) return true;
+                                            return "quit";
+                                        }) as VariableDeclaration | undefined;
+                                        if (variableLikeDeclaration && !variableLikeDeclaration.type && variableLikeDeclaration.initializer) {
+                                            const initializer = sourceProp.valueDeclaration.initializer;
+                                            let value: string | undefined;
+                                            forEachType(targetType, t => {
+                                                if (isStringOrNumericLiteralLike(initializer) && t.flags & TypeFlags.StringOrNumberLiteral && (<LiteralType>t).value === initializer.text) {
+                                                    value = initializer.text;
+                                                    return true;
+                                                }
+                                                else if (initializer.kind === SyntaxKind.TrueKeyword || initializer.kind === SyntaxKind.FalseKeyword && t.flags & TypeFlags.BooleanLiteral) {
+                                                    return true;
+                                                }
+                                                return false;
+                                            });
+                                            if(value) {
+                                                reportError(Diagnostics.Type_0_is_not_assignable_to_type_1_Did_you_mean_2_as_2, typeToString(sourceType), typeToString(targetType), value);
+                                            }
+                                        }
+                                    }
                                     reportError(Diagnostics.Types_of_property_0_are_incompatible, symbolToString(targetProp));
                                 }
                                 return Ternary.False;
diff --git a/src/compiler/diagnosticMessages.json b/src/compiler/diagnosticMessages.json
index 9ba3c4e8cf150..3992f9d2aaf7c 100644
--- a/src/compiler/diagnosticMessages.json
+++ b/src/compiler/diagnosticMessages.json
@@ -2437,6 +2437,10 @@
         "category": "Error",
         "code": 2732
     },
+    "Type '{0}' is not assignable to type '{1}'. Did you mean '{2} as {2}'?": {
+        "category": "Error",
+        "code": 2733
+    },
 
     "Import declaration '{0}' is using private name '{1}'.": {
         "category": "Error",
diff --git a/tests/baselines/reference/stringAssignToStringLiteralType.errors.txt b/tests/baselines/reference/stringAssignToStringLiteralType.errors.txt
new file mode 100644
index 0000000000000..783fb68ef0c40
--- /dev/null
+++ b/tests/baselines/reference/stringAssignToStringLiteralType.errors.txt
@@ -0,0 +1,19 @@
+tests/cases/compiler/stringAssignToStringLiteralType.ts(6,10): error TS2345: Argument of type '{ cherry: string; }' is not assignable to parameter of type 'IceCreamOptions'.
+  Types of property 'cherry' are incompatible.
+    Type 'string' is not assignable to type '"yes" | "no"'. Did you mean 'yes as yes'?
+      Type 'string' is not assignable to type '"yes" | "no"'.
+
+
+==== tests/cases/compiler/stringAssignToStringLiteralType.ts (1 errors) ====
+    interface IceCreamOptions {
+        readonly cherry: "yes" | "no"
+    }
+    declare function iceCream(options: IceCreamOptions): void;
+    const options = { cherry: "yes" };
+    iceCream(options);
+             ~~~~~~~
+!!! error TS2345: Argument of type '{ cherry: string; }' is not assignable to parameter of type 'IceCreamOptions'.
+!!! error TS2345:   Types of property 'cherry' are incompatible.
+!!! error TS2345:     Type 'string' is not assignable to type '"yes" | "no"'. Did you mean 'yes as yes'?
+!!! error TS2345:       Type 'string' is not assignable to type '"yes" | "no"'.
+    
\ No newline at end of file
diff --git a/tests/baselines/reference/stringAssignToStringLiteralType.js b/tests/baselines/reference/stringAssignToStringLiteralType.js
new file mode 100644
index 0000000000000..aeeb405c0b559
--- /dev/null
+++ b/tests/baselines/reference/stringAssignToStringLiteralType.js
@@ -0,0 +1,12 @@
+//// [stringAssignToStringLiteralType.ts]
+interface IceCreamOptions {
+    readonly cherry: "yes" | "no"
+}
+declare function iceCream(options: IceCreamOptions): void;
+const options = { cherry: "yes" };
+iceCream(options);
+
+
+//// [stringAssignToStringLiteralType.js]
+var options = { cherry: "yes" };
+iceCream(options);
diff --git a/tests/baselines/reference/stringAssignToStringLiteralType.symbols b/tests/baselines/reference/stringAssignToStringLiteralType.symbols
new file mode 100644
index 0000000000000..e6a8da3013f76
--- /dev/null
+++ b/tests/baselines/reference/stringAssignToStringLiteralType.symbols
@@ -0,0 +1,20 @@
+=== tests/cases/compiler/stringAssignToStringLiteralType.ts ===
+interface IceCreamOptions {
+>IceCreamOptions : Symbol(IceCreamOptions, Decl(stringAssignToStringLiteralType.ts, 0, 0))
+
+    readonly cherry: "yes" | "no"
+>cherry : Symbol(IceCreamOptions.cherry, Decl(stringAssignToStringLiteralType.ts, 0, 27))
+}
+declare function iceCream(options: IceCreamOptions): void;
+>iceCream : Symbol(iceCream, Decl(stringAssignToStringLiteralType.ts, 2, 1))
+>options : Symbol(options, Decl(stringAssignToStringLiteralType.ts, 3, 26))
+>IceCreamOptions : Symbol(IceCreamOptions, Decl(stringAssignToStringLiteralType.ts, 0, 0))
+
+const options = { cherry: "yes" };
+>options : Symbol(options, Decl(stringAssignToStringLiteralType.ts, 4, 5))
+>cherry : Symbol(cherry, Decl(stringAssignToStringLiteralType.ts, 4, 17))
+
+iceCream(options);
+>iceCream : Symbol(iceCream, Decl(stringAssignToStringLiteralType.ts, 2, 1))
+>options : Symbol(options, Decl(stringAssignToStringLiteralType.ts, 4, 5))
+
diff --git a/tests/baselines/reference/stringAssignToStringLiteralType.types b/tests/baselines/reference/stringAssignToStringLiteralType.types
new file mode 100644
index 0000000000000..f896808e0a116
--- /dev/null
+++ b/tests/baselines/reference/stringAssignToStringLiteralType.types
@@ -0,0 +1,20 @@
+=== tests/cases/compiler/stringAssignToStringLiteralType.ts ===
+interface IceCreamOptions {
+    readonly cherry: "yes" | "no"
+>cherry : "yes" | "no"
+}
+declare function iceCream(options: IceCreamOptions): void;
+>iceCream : (options: IceCreamOptions) => void
+>options : IceCreamOptions
+
+const options = { cherry: "yes" };
+>options : { cherry: string; }
+>{ cherry: "yes" } : { cherry: string; }
+>cherry : string
+>"yes" : "yes"
+
+iceCream(options);
+>iceCream(options) : void
+>iceCream : (options: IceCreamOptions) => void
+>options : { cherry: string; }
+
diff --git a/tests/cases/compiler/stringAssignToStringLiteralType.ts b/tests/cases/compiler/stringAssignToStringLiteralType.ts
new file mode 100644
index 0000000000000..899a24c124f69
--- /dev/null
+++ b/tests/cases/compiler/stringAssignToStringLiteralType.ts
@@ -0,0 +1,6 @@
+interface IceCreamOptions {
+    readonly cherry: "yes" | "no"
+}
+declare function iceCream(options: IceCreamOptions): void;
+const options = { cherry: "yes" };
+iceCream(options);