diff --git a/compiler/semtypinst.nim b/compiler/semtypinst.nim
index 2aca2c7a4baf..6b2e8a679277 100644
--- a/compiler/semtypinst.nim
+++ b/compiler/semtypinst.nim
@@ -375,6 +375,10 @@ proc lookupTypeVar(cl: var TReplTypeVars, t: PType): PType =
   result = cl.typeMap.lookup(t)
   if result == nil:
     if cl.allowMetaTypes or tfRetType in t.flags: return
+
+    if t.kind == tyStatic:
+      return nil
+
     localError(cl.c.config, t.sym.info, "cannot instantiate: '" & typeToString(t) & "'")
     result = errorType(cl.c)
     # In order to prevent endless recursions, we must remember
@@ -431,6 +435,16 @@ proc handleGenericInvocation(cl: var TReplTypeVars, t: PType): PType =
         if header == t: header = instCopyType(cl, t)
         header[i] = x
         propagateToOwner(header, x)
+    elif x.kind in {tyStatic}:
+      let y = lookupTypeVar(cl, x)
+      # In templates the lookup can lead to concrete types like tyInt instead of tyStatic,
+      # which can't be handled like this.
+      if y != nil and y.kind == tyStatic:
+        if header == t: header = instCopyType(cl, t)
+        header[i] = y
+        propagateToOwner(header, y)
+      else:
+        propagateToOwner(header, x)
     else:
       propagateToOwner(header, x)
 
diff --git a/tests/generics/t23628.nim b/tests/generics/t23628.nim
new file mode 100644
index 000000000000..3e2750a56f40
--- /dev/null
+++ b/tests/generics/t23628.nim
@@ -0,0 +1,14 @@
+discard """
+output: '''5
+'''
+"""
+
+type
+  Bar[T; C: static int] = object
+    arr: array[C, ptr T]
+
+  Foo[T; C: static int] = object
+    bar: Bar[Foo[T, C], C]
+
+var f: Foo[int, 5]
+echo f.bar.arr.len