diff --git a/integration-tests/main/src/test/java/io/quarkus/it/main/JaxbTestCase.java b/integration-tests/main/src/test/java/io/quarkus/it/main/JaxbTestCase.java
index 4e23e989055e7..62110d4baeb4a 100644
--- a/integration-tests/main/src/test/java/io/quarkus/it/main/JaxbTestCase.java
+++ b/integration-tests/main/src/test/java/io/quarkus/it/main/JaxbTestCase.java
@@ -2,6 +2,10 @@
 
 import static org.hamcrest.Matchers.contains;
 
+import java.util.concurrent.atomic.AtomicInteger;
+
+import org.junit.jupiter.api.Assertions;
+import org.junit.jupiter.api.BeforeEach;
 import org.junit.jupiter.api.Nested;
 import org.junit.jupiter.api.Test;
 
@@ -11,12 +15,26 @@
 @QuarkusTest
 public class JaxbTestCase {
 
+    private static final AtomicInteger count = new AtomicInteger(0);
+
+    @BeforeEach
+    public void beforeInEnclosing() {
+        count.incrementAndGet();
+    }
+
     @Nested
     class SomeClass {
+
+        @BeforeEach
+        public void beforeInTest() {
+            count.incrementAndGet();
+        }
+
         @Test
         public void testNews() {
             RestAssured.when().get("/test/jaxb/getnews").then()
                     .body("author", contains("Emmanuel Bernard"));
+            Assertions.assertEquals(2, count.get());
         }
     }
 
diff --git a/test-framework/junit5/src/main/java/io/quarkus/test/junit/QuarkusTestExtension.java b/test-framework/junit5/src/main/java/io/quarkus/test/junit/QuarkusTestExtension.java
index 4122ebbad410d..1bae13a1216b3 100644
--- a/test-framework/junit5/src/main/java/io/quarkus/test/junit/QuarkusTestExtension.java
+++ b/test-framework/junit5/src/main/java/io/quarkus/test/junit/QuarkusTestExtension.java
@@ -919,34 +919,19 @@ public void interceptAfterAllMethod(Invocation<Void> invocation, ReflectiveInvoc
     private Object runExtensionMethod(ReflectiveInvocationContext<Method> invocationContext, ExtensionContext extensionContext)
             throws Throwable {
         resetHangTimeout();
-        Method newMethod = null;
 
         ClassLoader old = setCCL(runningQuarkusApplication.getClassLoader());
         try {
-            Class<?> c = Class.forName(extensionContext.getRequiredTestClass().getName(), true,
+            Class<?> testClassFromTCCL = Class.forName(extensionContext.getRequiredTestClass().getName(), true,
                     Thread.currentThread().getContextClassLoader());
-            while (c != Object.class) {
-                if (c.getName().equals(invocationContext.getExecutable().getDeclaringClass().getName())) {
-                    try {
-                        Class<?>[] originalParameterTypes = invocationContext.getExecutable().getParameterTypes();
-                        List<Class<?>> parameterTypesFromTccl = new ArrayList<>(originalParameterTypes.length);
-                        for (Class<?> type : originalParameterTypes) {
-                            if (type.isPrimitive()) {
-                                parameterTypesFromTccl.add(type);
-                            } else {
-                                parameterTypesFromTccl
-                                        .add(Class.forName(type.getName(), true,
-                                                Thread.currentThread().getContextClassLoader()));
-                            }
-                        }
-                        newMethod = c.getDeclaredMethod(invocationContext.getExecutable().getName(),
-                                parameterTypesFromTccl.toArray(new Class[0]));
-                        break;
-                    } catch (NoSuchMethodException ignored) {
-
-                    }
-                }
-                c = c.getSuperclass();
+            Method newMethod = determineTCCLExtensionMethod(invocationContext, testClassFromTCCL);
+            boolean methodFromEnclosing = false;
+            // this is needed to support before*** and after*** methods that are part of class that encloses the test class
+            // (the test class is in this case a @Nested test)
+            if ((newMethod == null) && (testClassFromTCCL.getEnclosingClass() != null)) {
+                testClassFromTCCL = testClassFromTCCL.getEnclosingClass();
+                newMethod = determineTCCLExtensionMethod(invocationContext, testClassFromTCCL);
+                methodFromEnclosing = true;
             }
             if (newMethod == null) {
                 throw new RuntimeException("Could not find method " + invocationContext.getExecutable() + " on test class");
@@ -990,7 +975,13 @@ private Object runExtensionMethod(ReflectiveInvocationContext<Method> invocation
                 }
             }
 
-            return newMethod.invoke(actualTestInstance, argumentsFromTccl.toArray(new Object[0]));
+            Object effectiveTestInstance = actualTestInstance;
+            if (methodFromEnclosing) {
+                // TODO: this is a little dodgy, ideally we would need to use the same constructor that was used for the original object
+                // but it's unlikely(?) we will run into this combo
+                effectiveTestInstance = testClassFromTCCL.getConstructor().newInstance();
+            }
+            return newMethod.invoke(effectiveTestInstance, argumentsFromTccl.toArray(new Object[0]));
         } catch (InvocationTargetException e) {
             throw e.getCause();
         } catch (IllegalAccessException | ClassNotFoundException e) {
@@ -1000,6 +991,35 @@ private Object runExtensionMethod(ReflectiveInvocationContext<Method> invocation
         }
     }
 
+    private Method determineTCCLExtensionMethod(ReflectiveInvocationContext<Method> invocationContext, Class<?> c)
+            throws ClassNotFoundException {
+        Method newMethod = null;
+        while (c != Object.class) {
+            if (c.getName().equals(invocationContext.getExecutable().getDeclaringClass().getName())) {
+                try {
+                    Class<?>[] originalParameterTypes = invocationContext.getExecutable().getParameterTypes();
+                    List<Class<?>> parameterTypesFromTccl = new ArrayList<>(originalParameterTypes.length);
+                    for (Class<?> type : originalParameterTypes) {
+                        if (type.isPrimitive()) {
+                            parameterTypesFromTccl.add(type);
+                        } else {
+                            parameterTypesFromTccl
+                                    .add(Class.forName(type.getName(), true,
+                                            Thread.currentThread().getContextClassLoader()));
+                        }
+                    }
+                    newMethod = c.getDeclaredMethod(invocationContext.getExecutable().getName(),
+                            parameterTypesFromTccl.toArray(new Class[0]));
+                    break;
+                } catch (NoSuchMethodException ignored) {
+
+                }
+            }
+            c = c.getSuperclass();
+        }
+        return newMethod;
+    }
+
     @Override
     public void afterAll(ExtensionContext context) throws Exception {
         resetHangTimeout();