diff --git a/haiku/_src/lift_test.py b/haiku/_src/lift_test.py
index 1cdf3fcaa..4e8366209 100644
--- a/haiku/_src/lift_test.py
+++ b/haiku/_src/lift_test.py
@@ -170,14 +170,27 @@ def f():
         ValueError, "must be used within the same call to init/apply"):
       f.init(None)
 
-  def test_transparent_lift(self):
+  @parameterized.parameters(
+      (True,),  # passes, previous test
+      (False,),  # fails
+      )
+  def test_transparent_lift(self, inner_module_instantiated_inside_transform):
     class OuterModule(module.Module):
 
       def __call__(self, x):
         x += base.get_parameter("a", shape=[10, 10], init=jnp.zeros)
 
-        def inner_fn(x):
-          return InnerModule(name="inner")(x)
+        if inner_module_instantiated_inside_transform:
+          # These weights will end up being called "outer/inner", ok!
+          def inner_fn(x):
+            return InnerModule(name="inner")(x)
+        else:
+          inner_module = InnerModule(name="inner")
+          # These weights will end up being called "outer/outer/inner",
+          # causing the test to fail. I would be very surprised if this is
+          # desider behavior.
+          def inner_fn(x):
+            return inner_module(x)
 
         inner_transformed = transform.transform(inner_fn)
         inner_params = lift.transparent_lift(inner_transformed.init)(