diff --git a/crates/oxc_semantic/src/builder.rs b/crates/oxc_semantic/src/builder.rs
index a3d59af88..69c41363f 100644
--- a/crates/oxc_semantic/src/builder.rs
+++ b/crates/oxc_semantic/src/builder.rs
@@ -54,6 +54,8 @@ pub struct SemanticBuilder<'a> {
     pub current_node_flags: NodeFlags,
     pub current_symbol_flags: SymbolFlags,
     pub current_scope_id: ScopeId,
+    /// Stores current `AstKind::Function` and `AstKind::ArrowExpression` during AST visit
+    pub function_stack: Vec<AstNodeId>,
     // To make a namespace/module value like
     // we need the to know the modules we are inside
     // and when we reach a value declaration we set it
@@ -103,6 +105,7 @@ impl<'a> SemanticBuilder<'a> {
             current_symbol_flags: SymbolFlags::empty(),
             in_type_definition: false,
             current_scope_id,
+            function_stack: vec![],
             namespace_stack: vec![],
             nodes: AstNodes::default(),
             scope,
@@ -226,9 +229,8 @@ impl<'a> SemanticBuilder<'a> {
     }
 
     pub fn set_function_node_flag(&mut self, flag: NodeFlags) {
-        if self.current_scope_flags().is_function() {
-            *self.nodes.get_node_mut(self.scope.get_node_id(self.current_scope_id)).flags_mut() |=
-                flag;
+        if let Some(current_function) = self.function_stack.last() {
+            *self.nodes.get_node_mut(*current_function).flags_mut() |= flag;
         }
     }
 
@@ -1659,12 +1661,14 @@ impl<'a> SemanticBuilder<'a> {
             }
             AstKind::StaticBlock(_) => self.label_builder.enter_function_or_static_block(),
             AstKind::Function(func) => {
+                self.function_stack.push(self.current_node_id);
                 func.bind(self);
                 self.label_builder.enter_function_or_static_block();
                 self.add_current_node_id_to_current_scope();
                 self.make_all_namespaces_valuelike();
             }
             AstKind::ArrowExpression(_) => {
+                self.function_stack.push(self.current_node_id);
                 self.add_current_node_id_to_current_scope();
                 self.make_all_namespaces_valuelike();
             }
@@ -1761,9 +1765,16 @@ impl<'a> SemanticBuilder<'a> {
                 self.current_symbol_flags -= SymbolFlags::Export;
             }
             AstKind::LabeledStatement(_) => self.label_builder.leave(),
-            AstKind::StaticBlock(_) | AstKind::Function(_) => {
+            AstKind::StaticBlock(_) => {
                 self.label_builder.leave_function_or_static_block();
             }
+            AstKind::Function(_) => {
+                self.label_builder.leave_function_or_static_block();
+                self.function_stack.pop();
+            }
+            AstKind::ArrowExpression(_) => {
+                self.function_stack.pop();
+            }
             AstKind::TSModuleBlock(_) => {
                 self.namespace_stack.pop();
             }