diff --git a/spec/operator/or_spec.lua b/spec/operator/or_spec.lua
index 082dc80ef..eea54753e 100644
--- a/spec/operator/or_spec.lua
+++ b/spec/operator/or_spec.lua
@@ -128,4 +128,11 @@ describe("or", function()
       local x: string | number = "hello" or "world"
    ]]))
 
+   it("resolves type arguments when both types in 'or' match expected type (regression test for #706)", util.check([[
+      local t1: {string:number} = { foo = 42 }
+      local t2: {string:number} = { foo = 42 }
+      for _, v in pairs(t1 or t2) do
+          print(v * v)
+      end
+   ]]))
 end)
diff --git a/tl.lua b/tl.lua
index d52abae06..a17a96991 100644
--- a/tl.lua
+++ b/tl.lua
@@ -9969,7 +9969,7 @@ tl.type_check = function(ast, opts)
                   local a_is = is_a(a, node.expected)
                   local b_is = is_a(b, node.expected)
                   if a_is and b_is then
-                     node.type = node.expected
+                     node.type = resolve_typevars_at(node, node.expected)
                   elseif a_is then
                      node.type = resolve_tuple(b)
                   else
diff --git a/tl.tl b/tl.tl
index f4eea84c7..1c857442a 100644
--- a/tl.tl
+++ b/tl.tl
@@ -9969,7 +9969,7 @@ tl.type_check = function(ast: Node, opts: TypeCheckOptions): Result, string
                   local a_is = is_a(a, node.expected)
                   local b_is = is_a(b, node.expected)
                   if a_is and b_is then
-                     node.type = node.expected
+                     node.type = resolve_typevars_at(node, node.expected)
                   elseif a_is then
                      node.type = resolve_tuple(b)
                   else