diff --git a/vlib/v/gen/fn.v b/vlib/v/gen/fn.v
index 193cbc8297..8ab567c8f0 100644
--- a/vlib/v/gen/fn.v
+++ b/vlib/v/gen/fn.v
@@ -63,7 +63,6 @@ fn (mut g Gen) gen_fn_decl(it ast.FnDecl, skip bool) {
 		// foo<T>() => foo_int(), foo_string() etc
 		gen_name := g.typ(g.cur_generic_type)
 		name += '_' + gen_name
-		type_name = type_name.replace('T', gen_name)
 	}
 	// if g.pref.show_cc && it.is_builtin {
 	// println(name)
@@ -223,8 +222,6 @@ fn (mut g Gen) fn_args(args []table.Param, is_variadic bool) ([]string, []string
 		// }
 		if g.cur_generic_type != 0 {
 			// foo<T>() => foo_int(), foo_string() etc
-			gen_name := g.typ(g.cur_generic_type)
-			arg_type_name = arg_type_name.replace('T', gen_name)
 		}
 		is_varg := i == args.len - 1 && is_variadic
 		if is_varg {
diff --git a/vlib/v/tests/generic_fn_returning_type_with_T_test.v b/vlib/v/tests/generic_fn_returning_type_with_T_test.v
new file mode 100644
index 0000000000..0721c606fe
--- /dev/null
+++ b/vlib/v/tests/generic_fn_returning_type_with_T_test.v
@@ -0,0 +1,32 @@
+struct BuildData { x int }
+struct Tensor { x int }
+fn new_tensor<T>(data BuildData) Tensor {
+	println('data: $data')
+	x := T(data.x)
+    println(x)
+	return Tensor{ data.x }
+}
+fn test_generic_function_returning_type_starting_with_t() {
+	ft := new_tensor<f64>(x:123)
+	println(ft)
+    assert typeof(ft) == 'Tensor'
+    assert '$ft' == 'Tensor{\n    x: 123\n}'
+    //
+	it := new_tensor<int>(x:456)
+	println(it)
+    assert typeof(it) == 'Tensor'
+    assert '$it' == 'Tensor{\n    x: 456\n}'
+}
+
+// the following verifies that returning a generic type T
+// works at the same time as returning a type starting with T
+fn new_t<T>(o T) T {
+	x := T(o)
+    return x
+}
+fn test_generic_function_returning_t_type() {
+	f := new_t<f64>(1.23)
+    i := new_t<int>(456)
+    assert '$f' == '1.23'
+    assert '$i' == '456'
+}