diff --git a/pyrightconfig.ci.json b/pyrightconfig.ci.json
index ca44e111b..08b7c4fa0 100644
--- a/pyrightconfig.ci.json
+++ b/pyrightconfig.ci.json
@@ -5,7 +5,6 @@
     "**/node_modules/**",
     "temp/tests/Python/test_applicative.py",
     "temp/tests/Python/test_hash_set.py",
-    "temp/tests/Python/test_mailbox_processor.py",
     "temp/tests/Python/test_nested_and_recursive_pattern.py",
     "temp/tests/Python/fable_modules/thoth_json_python/encode.py"
   ]
diff --git a/src/Fable.Cli/CHANGELOG.md b/src/Fable.Cli/CHANGELOG.md
index d2da0ede4..56b34bb2a 100644
--- a/src/Fable.Cli/CHANGELOG.md
+++ b/src/Fable.Cli/CHANGELOG.md
@@ -11,6 +11,10 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 
 * [Beam] Add Erlang/BEAM target (`--lang beam`). Compiles F# to `.erl` source files. 2086 tests passing. (by @dbrattli)
 
+### Fixed
+
+* [Python] Fix type var scoping for PEP 695 annotations: emit `Any` for type vars outside function scope and prevent non-repeated generic params from leaking into `ScopedTypeParams` (by @dbrattli)
+
 ## 5.0.0-alpha.24 - 2026-02-13
 
 ### Fixed
diff --git a/src/Fable.Compiler/CHANGELOG.md b/src/Fable.Compiler/CHANGELOG.md
index 639c04bd5..475e29699 100644
--- a/src/Fable.Compiler/CHANGELOG.md
+++ b/src/Fable.Compiler/CHANGELOG.md
@@ -11,6 +11,10 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 
 * [Beam] Add Erlang/BEAM compilation support: Fable2Beam transform, Beam Replacements, ErlangPrinter, and 31 runtime `.erl` modules. 2086 tests passing. (by @dbrattli)
 
+### Fixed
+
+* [Python] Fix type var scoping for PEP 695 annotations: emit `Any` for type vars outside function scope and prevent non-repeated generic params from leaking into `ScopedTypeParams` (by @dbrattli)
+
 ## 5.0.0-alpha.23 - 2026-02-13
 
 ### Fixed
diff --git a/src/Fable.Transforms/Python/Fable2Python.Annotation.fs b/src/Fable.Transforms/Python/Fable2Python.Annotation.fs
index d1baf0d60..0df69428e 100644
--- a/src/Fable.Transforms/Python/Fable2Python.Annotation.fs
+++ b/src/Fable.Transforms/Python/Fable2Python.Annotation.fs
@@ -424,8 +424,10 @@ let rec typeAnnotation
             com.AddTypeVar(ctx, name), []
         | Some _ -> stdlibModuleTypeHint com ctx "typing" "Any" [] repeatedGenerics
         | None ->
-            let name = Helpers.clean name
-            com.AddTypeVar(ctx, name), []
+            // No repeatedGenerics info means we're outside a function type param scope
+            // (e.g., class fields, variable annotations). With PEP 695, type vars are
+            // lexically scoped, so emit Any instead of an undefined type var reference.
+            stdlibModuleTypeHint com ctx "typing" "Any" [] repeatedGenerics
     | Fable.Unit -> Expression.none, []
     | Fable.Boolean -> Expression.name "bool", []
     | Fable.Char -> Expression.name "str", []
diff --git a/src/Fable.Transforms/Python/Fable2Python.Transforms.fs b/src/Fable.Transforms/Python/Fable2Python.Transforms.fs
index 46e242afa..097022d85 100644
--- a/src/Fable.Transforms/Python/Fable2Python.Transforms.fs
+++ b/src/Fable.Transforms/Python/Fable2Python.Transforms.fs
@@ -3022,8 +3022,11 @@ let transformFunction
     let mutable isTailCallOptimized = false
 
     let argTypes = args |> List.map (fun id -> id.Type)
-    let genTypeParams = getGenericTypeParams (argTypes @ [ body.Type ])
-    let newTypeParams = Set.difference genTypeParams ctx.ScopedTypeParams
+    // Only track actually-declared (repeated) generic params in ScopedTypeParams.
+    // With PEP 695, type params are lexically scoped, so only params that appear
+    // in the function's [] declaration should be tracked. Non-repeated params
+    // (erased to Any) must not enter scope or inner functions will reference them.
+    let newTypeParams = Set.difference repeatedGenerics ctx.ScopedTypeParams
 
     let ctx =
         { ctx with
@@ -3739,13 +3742,35 @@ let transformModuleFunction
     (info: Fable.MemberFunctionOrValue)
     (membName: string)
     (fableArgs: Fable.Ident list)
-    body
+    (body: Fable.Expr)
     =
+    let argTypes = fableArgs |> List.map _.Type
+
+    // Compute which type params will be declared in this function's PEP 695 []
+    // BEFORE transforming the body, so inner functions know these are already in scope
+    // and won't re-declare them (which would cause "TypeVar already in use" errors).
+    let explicitGenerics = Annotation.getMemberGenParams info.GenericParameters
+
+    let signatureGenerics =
+        (getGenericTypeParams (argTypes @ [ body.Type ]), ctx.ScopedTypeParams)
+        ||> Set.difference
+
+    let declaredTypeParams =
+        Set.empty
+        |> Set.union explicitGenerics
+        |> Set.union signatureGenerics
+        |> Set.difference
+        <| ctx.ScopedTypeParams
+
+    let ctxWithDeclaredParams =
+        { ctx with ScopedTypeParams = Set.union ctx.ScopedTypeParams declaredTypeParams }
+
     let args, body', returnType =
-        getMemberArgsAndBody com ctx (NonAttached membName) info.HasSpread fableArgs body
+        getMemberArgsAndBody com ctxWithDeclaredParams (NonAttached membName) info.HasSpread fableArgs body
+
+    let typeParams =
+        Annotation.makeFunctionTypeParamsWithConstraints com ctx info.GenericParameters declaredTypeParams
 
-    let argTypes = fableArgs |> List.map _.Type
-    let typeParams = calculateTypeParams com ctx info argTypes body.Type
     let name = com.GetIdentifier(ctx, membName |> Naming.toPythonNaming)
 
     let isAsync = isTaskType body.Type