diff --git a/llvm/lib/Target/WebAssembly/AsmParser/WebAssemblyAsmParser.cpp b/llvm/lib/Target/WebAssembly/AsmParser/WebAssemblyAsmParser.cpp
--- a/llvm/lib/Target/WebAssembly/AsmParser/WebAssemblyAsmParser.cpp
+++ b/llvm/lib/Target/WebAssembly/AsmParser/WebAssemblyAsmParser.cpp
@@ -203,7 +203,6 @@
   // guarantee that correct order.
   enum ParserState {
     FileStart,
-    Label,
     FunctionStart,
     FunctionLocals,
     Instructions,
@@ -223,9 +222,6 @@
   };
   std::vector<NestingType> NestingStack;
 
-  // We track this to see if a .functype following a label is the same,
-  // as this is how we recognize the start of a function.
-  MCSymbol *LastLabel = nullptr;
   MCSymbol *LastFunctionLabel = nullptr;
 
 public:
@@ -687,11 +683,6 @@
     return false;
   }
 
-  void onLabelParsed(MCSymbol *Symbol) override {
-    LastLabel = Symbol;
-    CurrentState = Label;
-  }
-
   bool parseSignature(wasm::WasmSignature *Signature) {
     if (expect(AsmToken::LParen, "("))
       return true;
@@ -808,12 +799,12 @@
       if (SymName.empty())
         return true;
       auto WasmSym = cast<MCSymbolWasm>(Ctx.getOrCreateSymbol(SymName));
-      if (CurrentState == Label && WasmSym == LastLabel) {
+      if (WasmSym->isDefined()) {
         // This .functype indicates a start of a function.
         if (ensureEmptyNestingStack())
           return true;
         CurrentState = FunctionStart;
-        LastFunctionLabel = LastLabel;
+        LastFunctionLabel = WasmSym;
         push(Function);
       }
       auto Signature = std::make_unique<wasm::WasmSignature>();
@@ -881,7 +872,7 @@
 
     if (DirectiveID.getString() == ".local") {
       if (CurrentState != FunctionStart)
-        return error(".local directive should follow the start of a function",
+        return error(".local directive should follow the start of a function: ",
                      Lexer.getTok());
       SmallVector<wasm::ValType, 4> Locals;
       if (parseRegTypeList(Locals))
diff --git a/llvm/test/MC/WebAssembly/basic-assembly.s b/llvm/test/MC/WebAssembly/basic-assembly.s
--- a/llvm/test/MC/WebAssembly/basic-assembly.s
+++ b/llvm/test/MC/WebAssembly/basic-assembly.s
@@ -8,6 +8,8 @@
     end_function
 
 test0:
+# local labels can appear between label and its .functype.
+.Ltest0begin:
     # Test all types:
     .functype   test0 (i32, i64) -> (i32)
     .eventtype  __cpp_exception i32
@@ -116,17 +118,18 @@
     .globaltype __stack_pointer, i32
 
 .tabletype empty_eref_table, externref
-empty_eref_table:       
+empty_eref_table:
 
 .tabletype empty_fref_table, funcref
-empty_fref_table:       
+empty_fref_table:
+
 
-        
 # CHECK:           .text
 # CHECK-LABEL: empty_func:
 # CHECK-NEXT:      .functype	empty_func () -> ()
 # CHECK-NEXT:      end_function
 # CHECK-LABEL: test0:
+# CHECK-NEXT:  .Ltest0begin:
 # CHECK-NEXT:      .functype   test0 (i32, i64) -> (i32)
 # CHECK-NEXT:      .eventtype  __cpp_exception i32
 # CHECK-NEXT:      .local      f32, f64
@@ -226,6 +229,6 @@
 
 # CHECK:           .tabletype empty_eref_table, externref
 # CHECK-NEXT: empty_eref_table:
-        
+
 # CHECK:           .tabletype empty_fref_table, funcref
 # CHECK-NEXT: empty_fref_table: