diff --git a/docs/pages/release_notes.md b/docs/pages/release_notes.md
index c9df30afa8..c6ff938d7c 100644
--- a/docs/pages/release_notes.md
+++ b/docs/pages/release_notes.md
@@ -21,6 +21,9 @@ This is a bug fixing release.
 
 ### Fixed Issues
 
+*   java
+    *   [#793](https://github.com/pmd/pmd/issues/793): \[java] Parser error with private method in nested classes in interfaces
+
 ### API Changes
 
 ### External Contributions
\ No newline at end of file
diff --git a/pmd-java/etc/grammar/Java.jjt b/pmd-java/etc/grammar/Java.jjt
index 71548d28e7..46f04e8fb8 100644
--- a/pmd-java/etc/grammar/Java.jjt
+++ b/pmd-java/etc/grammar/Java.jjt
@@ -1,4 +1,7 @@
 /**
+ * Fixes #793 [java] Parser error with private method in nested classes in interfaces
+ * Andreas Dangel 12/2017
+ *====================================================================
  * Add support for Java 9 changes:
  * Private interface methods are only allowed with java9.
  * A single underscore "_" is an invalid identifier in java9.
@@ -340,6 +343,7 @@ public class JavaParser {
    * Keeps track whether we are dealing with an interface or not. Needed since the tree is
    * is not fully constructed yet, when we check for private interface methods.
    * The flag is updated, if entering ClassOrInterfaceDeclaration and reset when leaving.
+   * The flag is also reset, if entering a anonymous inner class.
    */
   private boolean inInterface = false;
   private void checkForBadPrivateInterfaceMethod(ASTMethodDeclaration node) {
@@ -2009,7 +2013,7 @@ void AllocationExpression():
      (
       ArrayDimsAndInits()
      |
-      Arguments() [ ClassOrInterfaceBody() ]
+      Arguments() [ {inInterface = false;} ClassOrInterfaceBody() ]
      )
   )
   { checkForBadAnonymousDiamondUsage(); }
diff --git a/pmd-java/src/main/java/net/sourceforge/pmd/lang/java/ast/ASTMethodDeclaration.java b/pmd-java/src/main/java/net/sourceforge/pmd/lang/java/ast/ASTMethodDeclaration.java
index ca230e0626..c85e9f24c7 100644
--- a/pmd-java/src/main/java/net/sourceforge/pmd/lang/java/ast/ASTMethodDeclaration.java
+++ b/pmd-java/src/main/java/net/sourceforge/pmd/lang/java/ast/ASTMethodDeclaration.java
@@ -75,8 +75,11 @@ public class ASTMethodDeclaration extends AbstractJavaAccessNode implements DFAG
 
 
     public boolean isInterfaceMember() {
-        ASTClassOrInterfaceDeclaration clz = getFirstParentOfType(ASTClassOrInterfaceDeclaration.class);
-        return clz != null && clz.isInterface();
+        ASTClassOrInterfaceBody body = getFirstParentOfType(ASTClassOrInterfaceBody.class);
+        if (body != null && body.jjtGetParent() instanceof ASTClassOrInterfaceDeclaration) {
+            return ((ASTClassOrInterfaceDeclaration) body.jjtGetParent()).isInterface();
+        }
+        return false;
     }
 
     public boolean isVoid() {
diff --git a/pmd-java/src/test/java/net/sourceforge/pmd/lang/java/ast/JDKVersionTest.java b/pmd-java/src/test/java/net/sourceforge/pmd/lang/java/ast/JDKVersionTest.java
index aef4882b70..71e49f2cd4 100644
--- a/pmd-java/src/test/java/net/sourceforge/pmd/lang/java/ast/JDKVersionTest.java
+++ b/pmd-java/src/test/java/net/sourceforge/pmd/lang/java/ast/JDKVersionTest.java
@@ -10,6 +10,7 @@ import static net.sourceforge.pmd.lang.java.ParserTstUtil.parseJava15;
 import static net.sourceforge.pmd.lang.java.ParserTstUtil.parseJava17;
 import static net.sourceforge.pmd.lang.java.ParserTstUtil.parseJava18;
 import static net.sourceforge.pmd.lang.java.ParserTstUtil.parseJava9;
+import static org.junit.Assert.assertFalse;
 
 import java.io.IOException;
 import java.nio.charset.StandardCharsets;
@@ -267,4 +268,11 @@ public class JDKVersionTest {
     public final void jdk9TryWithResources() {
         parseJava9(loadSource("jdk9_try_with_resources.java"));
     }
+
+    @Test
+    public final void jdk7PrivateMethodInnerClassInterface() {
+        ASTCompilationUnit acu = parseJava17(loadSource("private_method_in_inner_class_interface.java"));
+        ASTMethodDeclaration privateMethod = acu.getFirstDescendantOfType(ASTMethodDeclaration.class);
+        assertFalse(privateMethod.isInterfaceMember());
+    }
 }
diff --git a/pmd-java/src/test/resources/net/sourceforge/pmd/lang/java/ast/jdkversiontests/private_method_in_inner_class_interface.java b/pmd-java/src/test/resources/net/sourceforge/pmd/lang/java/ast/jdkversiontests/private_method_in_inner_class_interface.java
new file mode 100644
index 0000000000..8cc67a7e62
--- /dev/null
+++ b/pmd-java/src/test/resources/net/sourceforge/pmd/lang/java/ast/jdkversiontests/private_method_in_inner_class_interface.java
@@ -0,0 +1,28 @@
+/**
+ * BSD-style license; for more info see http://pmd.sourceforge.net/license.html
+ */
+
+package net.sourceforge.pmd.lang.java.ast.testdata;
+
+/**
+ * With Java9, private methods in interfaces are possible.
+ * But they must not be confused with private methods in inner classes of interfaces
+ * when using older java version.
+ *
+ * @see https://github.com/pmd/pmd/issues/793
+ */
+public interface InterfaceWithInnerClass {
+
+    Object FOO = new Object() {
+        private void privateMethod() { }
+    };
+
+    class InnerClass {
+        private void privateMethod() { }
+    }
+
+    enum InnerEnum {
+        VALUE;
+        private void privateMethod() { }
+    }
+}