diff --git a/mypy/semanal_main.py b/mypy/semanal_main.py
index 1185a3821553..09a1223be6aa 100644
--- a/mypy/semanal_main.py
+++ b/mypy/semanal_main.py
@@ -291,6 +291,8 @@ def process_top_level_function(
         deferred, incomplete, progress = semantic_analyze_target(
             target, module, state, node, active_type, final_iteration, patches
         )
+        if not incomplete:
+            state.manager.incomplete_namespaces.discard(module)
         if final_iteration:
             assert not deferred, "Must not defer during final iteration"
         if not progress:
diff --git a/test-data/unit/check-namedtuple.test b/test-data/unit/check-namedtuple.test
index e9d156754d9c..147270dff72e 100644
--- a/test-data/unit/check-namedtuple.test
+++ b/test-data/unit/check-namedtuple.test
@@ -1423,3 +1423,27 @@ class Foo(typing.NamedTuple):
         reveal_type(x)  # N: Revealed type is "builtins.int"
 [builtins fixtures/tuple.pyi]
 [typing fixtures/typing-namedtuple.pyi]
+
+[case testNameErrorInNamedTupleNestedInFunction1]
+from typing import NamedTuple
+
+def bar() -> None:
+    class MyNamedTuple(NamedTuple):
+        a: int
+        def foo(self) -> None:
+            ...
+    int_set: Set[int]  # E: Name "Set" is not defined \
+                       # N: Did you forget to import it from "typing"? (Suggestion: "from typing import Set")
+[builtins fixtures/tuple.pyi]
+[typing fixtures/typing-namedtuple.pyi]
+
+[case testNameErrorInNamedTupleNestedInFunction2]
+from typing import NamedTuple
+
+def bar() -> None:
+    class MyNamedTuple(NamedTuple):
+        a: int
+        def foo(self) -> None:
+            misspelled_var_name  # E: Name "misspelled_var_name" is not defined
+[builtins fixtures/tuple.pyi]
+[typing fixtures/typing-namedtuple.pyi]