diff --git a/src/bin/expect_tests/contract_tests.ml b/src/bin/expect_tests/contract_tests.ml
index cc22a7410..443102d80 100644
--- a/src/bin/expect_tests/contract_tests.ml
+++ b/src/bin/expect_tests/contract_tests.ml
@@ -2,6 +2,8 @@ open Cli_expect
 
 let contract basename =
   "../../test/contracts/" ^ basename
+let bad_contract basename =
+  "../../test/contracts/negative/" ^ basename
 
 let%expect_test _ =
   run_ligo_good [ "measure-contract" ; contract "coase.ligo" ; "main" ] ;
@@ -1024,3 +1026,15 @@ let%expect_test _ =
   [%expect {|
     failwith("This contract always fails") |}]
 
+let%expect_test _ =
+  run_ligo_bad [ "compile-contract" ; bad_contract "self_in_lambda.mligo" ; "main" ] ;
+  [%expect {|
+    ligo: Wrong SELF_ADDRESS location: SELF_ADDRESS is only allowed at top-level
+
+     If you're not sure how to fix this error, you can
+     do one of the following:
+
+    * Visit our documentation: https://ligolang.org/docs/intro/what-and-why/
+    * Ask a question on our Discord: https://discord.gg/9rhYaEt
+    * Open a gitlab issue: https://gitlab.com/ligolang/ligo/issues/new
+    * Check the changelog by running 'ligo changelog' |}]
\ No newline at end of file
diff --git a/src/test/contracts/negative/self_in_lambda.mligo b/src/test/contracts/negative/self_in_lambda.mligo
new file mode 100644
index 000000000..493047199
--- /dev/null
+++ b/src/test/contracts/negative/self_in_lambda.mligo
@@ -0,0 +1,5 @@
+let foo (u: unit) : address =
+  Current.self_address
+
+let main (ps: unit * address): (operation list * address) =
+  ( ([] : operation list) , foo)
\ No newline at end of file