diff --git a/language/move-compiler-v2/src/pipeline/reference_safety_processor.rs b/language/move-compiler-v2/src/pipeline/reference_safety_processor.rs
index 8443012af1..0d49d10dcb 100644
--- a/language/move-compiler-v2/src/pipeline/reference_safety_processor.rs
+++ b/language/move-compiler-v2/src/pipeline/reference_safety_processor.rs
@@ -1005,6 +1005,26 @@ impl<'env, 'state> LifetimeAnalysisStep<'env, 'state> {
         }
     }
 
+    /// Release all references that are not alive after this program point
+    /// from temp_to_label_map if `dests` do not contain any references
+    /// This function should be called before `check_write_local`
+    fn release_before_write_local(&mut self, dests: &[TempIndex]) {
+        let alive_temps = self.alive.after_set();
+        if !dests.iter().any(|temp| self.is_ref(*temp)) {
+            for temp in self
+                .state
+                .temp_to_label_map
+                .keys()
+                .cloned()
+                .collect::<Vec<_>>()
+            {
+                if !alive_temps.contains(&temp) && self.is_ref(temp) {
+                    self.state.release_ref(temp)
+                }
+            }
+        }
+    }
+
     /// Check whether a local can be written. This is only allowed if no borrowed references exist.
     fn check_write_local(&self, local: TempIndex) {
         if self.is_ref(local) {
@@ -1433,6 +1453,7 @@ impl<'env, 'state> LifetimeAnalysisStep<'env, 'state> {
             }
         } else {
             self.check_read_local(src, mode);
+            self.release_before_write_local(&[dest]);
             self.check_write_local(dest);
         }
     }
@@ -1498,6 +1519,7 @@ impl<'env, 'state> LifetimeAnalysisStep<'env, 'state> {
             self.check_read_local(*src, ReadMode::Argument);
         }
         // Next check whether we can assign to the destinations.
+        self.release_before_write_local(dests);
         for dest in dests {
             self.check_write_local(*dest)
         }
@@ -1688,6 +1710,7 @@ impl<'env, 'state> LifetimeAnalysisStep<'env, 'state> {
     /// Process a MoveFrom instruction.
     fn move_from(&mut self, dest: TempIndex, resource: &QualifiedInstId<StructId>, src: TempIndex) {
         self.check_read_local(src, ReadMode::Argument);
+        self.release_before_write_local(&[dest]);
         self.check_write_local(dest);
         if let Some(label) = self.state.label_for_global_with_children(resource) {
             self.error_with_hints(
@@ -1746,6 +1769,7 @@ impl<'env, 'state> LifetimeAnalysisStep<'env, 'state> {
     /// Process a ReadRef instruction.
     fn read_ref(&mut self, dest: TempIndex, src: TempIndex) {
         debug_assert!(self.is_ref(src));
+        self.release_before_write_local(&[dest]);
         self.check_write_local(dest);
         self.check_read_local(src, ReadMode::Argument);
     }
diff --git a/language/move-compiler-v2/tests/reference-safety/write_ref_dest.exp b/language/move-compiler-v2/tests/reference-safety/write_ref_dest.exp
new file mode 100644
index 0000000000..90b3290671
--- /dev/null
+++ b/language/move-compiler-v2/tests/reference-safety/write_ref_dest.exp
@@ -0,0 +1,2 @@
+
+============ bytecode verification succeeded ========
diff --git a/language/move-compiler-v2/tests/reference-safety/write_ref_dest.move b/language/move-compiler-v2/tests/reference-safety/write_ref_dest.move
new file mode 100644
index 0000000000..8a84eb291f
--- /dev/null
+++ b/language/move-compiler-v2/tests/reference-safety/write_ref_dest.move
@@ -0,0 +1,19 @@
+module 0x42::m {
+
+    fun foo(x: &vector<u64>): (vector<u64>, u64) {
+        (*x, 0)
+    }
+
+
+    fun test_call() {
+        let y = vector[];
+        (y, _) = foo(&y);
+        assert!(y == vector[], 0);
+    }
+
+    fun test_assign() {
+        let y = vector[1];
+        (y, _) = (*&y, 1);
+    }
+
+}
diff --git a/language/move-compiler-v2/tests/reference-safety/write_ref_dest.no-opt.exp b/language/move-compiler-v2/tests/reference-safety/write_ref_dest.no-opt.exp
new file mode 100644
index 0000000000..90b3290671
--- /dev/null
+++ b/language/move-compiler-v2/tests/reference-safety/write_ref_dest.no-opt.exp
@@ -0,0 +1,2 @@
+
+============ bytecode verification succeeded ========
diff --git a/language/move-compiler-v2/tests/reference-safety/write_ref_dest_err.exp b/language/move-compiler-v2/tests/reference-safety/write_ref_dest_err.exp
new file mode 100644
index 0000000000..6d97ceb7bd
--- /dev/null
+++ b/language/move-compiler-v2/tests/reference-safety/write_ref_dest_err.exp
@@ -0,0 +1,21 @@
+
+Diagnostics:
+error: cannot assign to borrowed local `_y`
+   ┌─ tests/reference-safety/write_ref_dest_err.move:18:19
+   │
+17 │         let z = &_y;
+   │                 --- previous local borrow
+18 │         (_y, _) = foo(&_y);
+   │                   ^^^^^^^^ attempted to assign here
+19 │         *z;
+   │         -- conflicting reference `z` used here
+
+error: cannot assign to borrowed local `_y`
+   ┌─ tests/reference-safety/write_ref_dest_err.move:25:9
+   │
+24 │         let z = &_y;
+   │                 --- previous local borrow
+25 │         _y = vector[2];
+   │         ^^^^^^^^^^^^^^ attempted to assign here
+26 │         *z;
+   │         -- conflicting reference `z` used here
diff --git a/language/move-compiler-v2/tests/reference-safety/write_ref_dest_err.move b/language/move-compiler-v2/tests/reference-safety/write_ref_dest_err.move
new file mode 100644
index 0000000000..64035f869f
--- /dev/null
+++ b/language/move-compiler-v2/tests/reference-safety/write_ref_dest_err.move
@@ -0,0 +1,29 @@
+module 0x42::m {
+
+    struct S has key, drop {
+
+    }
+
+    fun g(s: &S): &S {
+        s
+    }
+
+    fun foo(x: &vector<u64>): (vector<u64>, u64) {
+        (*x, 0)
+    }
+
+    fun test_call() {
+        let _y = vector[1];
+        let z = &_y;
+        (_y, _) = foo(&_y);
+        *z;
+    }
+
+    fun test_assign() {
+        let _y = vector[1];
+        let z = &_y;
+        _y = vector[2];
+        *z;
+    }
+
+}
diff --git a/language/move-compiler-v2/tests/reference-safety/write_ref_dest_err.no-opt.exp b/language/move-compiler-v2/tests/reference-safety/write_ref_dest_err.no-opt.exp
new file mode 100644
index 0000000000..6d97ceb7bd
--- /dev/null
+++ b/language/move-compiler-v2/tests/reference-safety/write_ref_dest_err.no-opt.exp
@@ -0,0 +1,21 @@
+
+Diagnostics:
+error: cannot assign to borrowed local `_y`
+   ┌─ tests/reference-safety/write_ref_dest_err.move:18:19
+   │
+17 │         let z = &_y;
+   │                 --- previous local borrow
+18 │         (_y, _) = foo(&_y);
+   │                   ^^^^^^^^ attempted to assign here
+19 │         *z;
+   │         -- conflicting reference `z` used here
+
+error: cannot assign to borrowed local `_y`
+   ┌─ tests/reference-safety/write_ref_dest_err.move:25:9
+   │
+24 │         let z = &_y;
+   │                 --- previous local borrow
+25 │         _y = vector[2];
+   │         ^^^^^^^^^^^^^^ attempted to assign here
+26 │         *z;
+   │         -- conflicting reference `z` used here
diff --git a/language/move-compiler-v2/transactional-tests/tests/misc/write_ref_dest.exp b/language/move-compiler-v2/transactional-tests/tests/misc/write_ref_dest.exp
new file mode 100644
index 0000000000..15b4a32619
--- /dev/null
+++ b/language/move-compiler-v2/transactional-tests/tests/misc/write_ref_dest.exp
@@ -0,0 +1,3 @@
+processed 3 tasks
+
+==> Compiler v2 delivered same results!
diff --git a/language/move-compiler-v2/transactional-tests/tests/misc/write_ref_dest.move b/language/move-compiler-v2/transactional-tests/tests/misc/write_ref_dest.move
new file mode 100644
index 0000000000..9eec374c2f
--- /dev/null
+++ b/language/move-compiler-v2/transactional-tests/tests/misc/write_ref_dest.move
@@ -0,0 +1,25 @@
+//# publish
+module 0x42::m {
+
+    fun foo(x: &vector<u64>): (vector<u64>, u64) {
+        (*x, 0)
+    }
+
+
+    fun test_call() {
+        let y = vector[];
+        (y, _) = foo(&y);
+        assert!(y == vector[], 0);
+    }
+
+    fun test_assign() {
+        let y = vector[1];
+        (y, _) = (*&y, 1);
+        assert!(y == vector[1], 0);
+    }
+
+}
+
+//# run 0x42::m::test_call --check-runtime-types
+
+//# run 0x42::m::test_assign --check-runtime-types