Fix the issue

docs/changelog.md

@@ -2,6 +2,8 @@
 
 ## Unreleased
 
+- Fix incorrect `undefined_name` errors when a class is nested in a nested
+  function and uses a name from the outer function (#750)
 - Fix incorrect `possibly_undefined_name` error on certain uses of the
   walrus operator (#749)
 - Fix narrowing on `isinstance` calls with arguments that are not

pyanalyze/name_check_visitor.py

@@ -1822,7 +1822,15 @@ def _get_current_class_object(self, node: ast.ClassDef) -> Optional[type]:
     def _visit_class_and_get_value(
         self, node: ast.ClassDef, current_class: Optional[type]
     ) -> Value:
-        if self._is_checking():
+        if self._is_collecting():
+            # If this is a nested class, we need to run the collecting phase to get data
+            # about names accessed from the class.
+            if len(self.scopes.scopes) > 2:
+                with self.scopes.add_scope(
+                    ScopeType.class_scope, scope_node=node, scope_object=current_class
+                ), self._set_current_class(current_class):
+                    self._generic_visit_list(node.body)
+        else:
             with self.scopes.add_scope(
                 ScopeType.class_scope, scope_node=None, scope_object=current_class
             ), self._set_current_class(current_class):

pyanalyze/test_stacked_scopes.py

@@ -1937,3 +1937,21 @@ class Nested:
                 return Nested
 
             return inner
+
+    @assert_passes()
+    def test_triple_function_nesting(self):
+        from typing_extensions import Literal, assert_type
+
+        def outer():
+            outer_var = "outer"
+
+            def inner():
+                inner_var = "inner"
+
+                def innermost():
+                    assert_type(outer_var, Literal["outer"])
+                    assert_type(inner_var, Literal["inner"])
+
+                return innermost
+
+            return inner