diff --git a/src/transformation/utils/function-context.ts b/src/transformation/utils/function-context.ts
index 3055c4f53..5b2c0cb4e 100644
--- a/src/transformation/utils/function-context.ts
+++ b/src/transformation/utils/function-context.ts
@@ -140,6 +140,10 @@ function computeDeclarationContextType(context: TransformationContext, signature
         return ContextType.NonVoid;
     }
 
+    if (signatureDeclaration.parent && ts.isTypeParameterDeclaration(signatureDeclaration.parent)) {
+        return ContextType.NonVoid;
+    }
+
     // When using --noImplicitSelf and the signature is defined in a file targeted by the program apply the @noSelf rule.
     const program = context.program;
     const options = program.getCompilerOptions() as CompilerOptions;
diff --git a/test/unit/functions/validation/validFunctionAssignments.spec.ts b/test/unit/functions/validation/validFunctionAssignments.spec.ts
index 7a68d0ea6..525b95929 100644
--- a/test/unit/functions/validation/validFunctionAssignments.spec.ts
+++ b/test/unit/functions/validation/validFunctionAssignments.spec.ts
@@ -248,3 +248,20 @@ test("Does not fail on union type signatures (#896)", () => {
         )
         .expectToHaveNoDiagnostics();
 });
+
+// https://github.com/TypeScriptToLua/TypeScriptToLua/issues/1568
+test("No false positives when using generic functions (#1568)", () => {
+    util.testModule`
+        /** @noSelf */
+        declare namespace Test {
+            export function testCallback<T extends (...args: any[]) => void>(
+                callback: T,
+            ): void;
+        }
+
+        Test.testCallback(() => {});
+
+        const f = () => {};
+        Test.testCallback(f);
+    `.expectToHaveNoDiagnostics();
+});