Index: lib/Sema/SemaTemplateInstantiateDecl.cpp
===================================================================
--- lib/Sema/SemaTemplateInstantiateDecl.cpp
+++ lib/Sema/SemaTemplateInstantiateDecl.cpp
@@ -3896,9 +3896,14 @@
       PushExpressionEvaluationContext(Sema::PotentiallyEvaluated, OldVar);
 
     // Instantiate the initializer.
-    ExprResult Init =
-        SubstInitializer(OldVar->getInit(), TemplateArgs,
-                         OldVar->getInitStyle() == VarDecl::CallInit);
+    ExprResult Init;
+
+    {
+      ContextRAII SwitchContext(*this, Var->getDeclContext());
+      Init = SubstInitializer(OldVar->getInit(), TemplateArgs,
+                              OldVar->getInitStyle() == VarDecl::CallInit);
+    }
+
     if (!Init.isInvalid()) {
       bool TypeMayContainAuto = true;
       Expr *InitExpr = Init.get();
Index: test/SemaCXX/vartemplate-lambda.cpp
===================================================================
--- /dev/null
+++ test/SemaCXX/vartemplate-lambda.cpp
@@ -0,0 +1,18 @@
+// RUN: %clang_cc1 -std=c++14 -fsyntax-only -verify %s
+// expected-no-diagnostics
+
+template <class> auto fn0 = [] {};
+template <typename> void foo0() { fn0<char>(); }
+
+template<typename T> auto fn1 = [](auto a) { return a + T(1); };
+
+template <typename X>
+int foo2() {
+  X a = 0x61;
+  fn1<char>(a);
+  return 0;
+}
+
+int main() {
+  foo2<int>();
+}