diff --git a/src/fennel-ls/diagnostics.fnl b/src/fennel-ls/diagnostics.fnl
index 789aac2..7f4cf0d 100644
--- a/src/fennel-ls/diagnostics.fnl
+++ b/src/fennel-ls/diagnostics.fnl
@@ -84,7 +84,7 @@ the `file.diagnostics` field, filling it with diagnostics."
       :codeDescription "bad-unpack"})))
 
 (λ var-never-set [self file symbol definition]
-  (if (and definition.var? (not definition.var-set))
+  (if (and definition.var? (not definition.var-set) (. file.lexical symbol))
     {:range (message.ast->range self file symbol)
      :message (.. "var is never set: " (tostring symbol) " Consider using (local) instead of (var)")
      :severity message.severity.WARN
diff --git a/test/diagnostic.fnl b/test/diagnostic.fnl
index 5c8c5c7..534e942 100644
--- a/test/diagnostic.fnl
+++ b/test/diagnostic.fnl
@@ -168,9 +168,8 @@
 
   (check "(var x 1) (set x 2) (print x)"
          [] [{}])
-  ;; TODO fix diagnostic
-  ; (check "(local x 10) (?. x)"
-  ;        [] [{:code 305}])
+  (check "(local x 10) (?. x)"
+         [] [{:code 305}])
   nil)
 
 ;; missing test for 306