diff --git a/src/cmd/compile/internal/gc/typecheck.go b/src/cmd/compile/internal/gc/typecheck.go
index 09c4a543c75..6f0f4f58e34 100644
--- a/src/cmd/compile/internal/gc/typecheck.go
+++ b/src/cmd/compile/internal/gc/typecheck.go
@@ -3415,6 +3415,12 @@ out:
 
 // type check function definition
 func typecheckfunc(n *Node) {
+	for _, ln := range n.Func.Dcl {
+		if ln.Op == ONAME && (ln.Class == PPARAM || ln.Class == PPARAMOUT) {
+			ln.Name.Decldepth = 1
+		}
+	}
+
 	n.Func.Nname = typecheck(n.Func.Nname, Erv|Easgn)
 	t := n.Func.Nname.Type
 	if t == nil {
@@ -3426,12 +3432,6 @@ func typecheckfunc(n *Node) {
 	if rcvr != nil && n.Func.Shortname != nil {
 		addmethod(n.Func.Shortname.Sym, t, true, n.Func.Pragma&Nointerface != 0)
 	}
-
-	for _, ln := range n.Func.Dcl {
-		if ln.Op == ONAME && (ln.Class == PPARAM || ln.Class == PPARAMOUT) {
-			ln.Name.Decldepth = 1
-		}
-	}
 }
 
 // The result of stringtoarraylit MUST be assigned back to n, e.g.
diff --git a/test/fixedbugs/issue17588.go b/test/fixedbugs/issue17588.go
new file mode 100644
index 00000000000..1be57c62923
--- /dev/null
+++ b/test/fixedbugs/issue17588.go
@@ -0,0 +1,20 @@
+// errorcheck
+
+// Copyright 2016 The Go Authors. All rights reserved.
+// Use of this source code is governed by a BSD-style
+// license that can be found in the LICENSE file.
+
+// Issue 17588: internal compiler error in typecheckclosure()
+// because in case of Func.Nname.Type == nil, Decldepth
+// is not initialized in typecheckfunc(). This test
+// produces that case.
+
+package p
+
+type F func(b T)  // ERROR "T is not a type"
+
+func T(fn F) {
+    func() {
+        fn(nil)  // If Decldepth is not initialized properly, typecheckclosure() Fatals here.
+    }()
+}