diff --git a/compiler/src/dotty/tools/dotc/parsing/JavaParsers.scala b/compiler/src/dotty/tools/dotc/parsing/JavaParsers.scala
index 79282b0e5223..8a9eca2c1e67 100644
--- a/compiler/src/dotty/tools/dotc/parsing/JavaParsers.scala
+++ b/compiler/src/dotty/tools/dotc/parsing/JavaParsers.scala
@@ -369,8 +369,8 @@ object JavaParsers {
     def annotation(): Option[Tree] = {
       def classOrId(): Tree =
         val id = qualId()
-        if in.lookaheadToken == CLASS then
-          in.nextToken()
+        if in.token == DOT && in.lookaheadToken == CLASS then
+          accept(DOT)
           accept(CLASS)
           TypeApply(
             Select(
diff --git a/tests/pos/i20026/J.java b/tests/pos/i20026/J.java
new file mode 100644
index 000000000000..e950024ed913
--- /dev/null
+++ b/tests/pos/i20026/J.java
@@ -0,0 +1,4 @@
+package p;
+
+@TestInstance(TestInstance.Lifecycle.PER_CLASS)
+class J { }
diff --git a/tests/pos/i20026/S.scala b/tests/pos/i20026/S.scala
new file mode 100644
index 000000000000..7da04d6b6bbe
--- /dev/null
+++ b/tests/pos/i20026/S.scala
@@ -0,0 +1 @@
+class S
diff --git a/tests/pos/i20026/TestInstance.java b/tests/pos/i20026/TestInstance.java
new file mode 100644
index 000000000000..8db79ad88d89
--- /dev/null
+++ b/tests/pos/i20026/TestInstance.java
@@ -0,0 +1,15 @@
+package p;
+
+import java.lang.annotation.ElementType;
+import java.lang.annotation.Inherited;
+import java.lang.annotation.Retention;
+import java.lang.annotation.RetentionPolicy;
+import java.lang.annotation.Target;
+
+@Target(ElementType.TYPE)
+@Retention(RetentionPolicy.RUNTIME)
+@Inherited
+public @interface TestInstance {
+    enum Lifecycle { PER_CLASS, PER_METHOD; }
+    Lifecycle value();
+}