diff --git a/compiler/src/dotty/tools/dotc/typer/EtaExpansion.scala b/compiler/src/dotty/tools/dotc/typer/EtaExpansion.scala
index 828b559a47ae..ec67c652cef0 100644
--- a/compiler/src/dotty/tools/dotc/typer/EtaExpansion.scala
+++ b/compiler/src/dotty/tools/dotc/typer/EtaExpansion.scala
@@ -27,9 +27,10 @@ object EtaExpansion {
     else {
       val name = UniqueName.fresh(prefix)
       val liftedType = fullyDefinedType(expr.tpe.widen, "lifted expression", expr.pos)
-      val sym = ctx.newSymbol(ctx.owner, name, EmptyFlags, liftedType, coord = positionCoord(expr.pos))
+      val flags = expr.symbol.flags & Unused | Synthetic
+      val sym = ctx.newSymbol(ctx.owner, name, flags, liftedType, coord = positionCoord(expr.pos))
       defs += ValDef(sym, expr)
-      ref(sym.termRef)
+      ref(sym.termRef).withPos(expr.pos)
     }
 
   /** Lift out common part of lhs tree taking part in an operator assignment such as
diff --git a/tests/neg/unused-args-lifted.scala b/tests/neg/unused-args-lifted.scala
new file mode 100644
index 000000000000..a7ef65fbb6cb
--- /dev/null
+++ b/tests/neg/unused-args-lifted.scala
@@ -0,0 +1,16 @@
+object Test {
+  def foo(a: Int)(b: Int, c: Int) = 42
+  unused def bar(i: Int): Int = {
+    println(1)
+    42
+  }
+  def baz: Int = {
+    println(1)
+    2
+  }
+  foo(
+    bar(baz) // error
+  )(
+    c = baz, b = baz  // force all args to be lifted in vals befor the call
+  )
+}
diff --git a/tests/pos/unused-args-lifted.scala b/tests/pos/unused-args-lifted.scala
new file mode 100644
index 000000000000..24bda0859571
--- /dev/null
+++ b/tests/pos/unused-args-lifted.scala
@@ -0,0 +1,12 @@
+object Test {
+  def foo(unused a: Int)(b: Int, c: Int) = 42
+  unused def bar(i: Int): Int = {
+    println(1)
+    42
+  }
+  def baz: Int = {
+    println(1)
+    2
+  }
+  foo(bar(baz))(c = baz, b = baz) // force all args to be lifted in vals befor the call
+}