diff --git a/pkgs/racket-test-core/tests/racket/optimize.rktl b/pkgs/racket-test-core/tests/racket/optimize.rktl
index a04c5ce91b..7780838439 100644
--- a/pkgs/racket-test-core/tests/racket/optimize.rktl
+++ b/pkgs/racket-test-core/tests/racket/optimize.rktl
@@ -3444,6 +3444,28 @@
 (err/rt-test (cwv-2-5-f (lambda () 1) (lambda (y z) (+ y 2))) exn:fail:contract:arity?)
 (err/rt-test (cwv-2-5-f (lambda () (values 1 2 3)) (lambda (y z) (+ y 2))) exn:fail:contract:arity?)
 
+;; ;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;
+;; Transform call-with-values to direct aplication:
+(test-comp '(lambda (f) (f 7))
+           '(lambda (f) (call-with-values (lambda () 7) (lambda (x) (f x)))))
+(test-comp '(lambda () (car 7))
+           '(lambda () (call-with-values (lambda () 7) car)))
+(test-comp '(lambda () ('not-a-procedure 7))
+           '(lambda () (call-with-values (lambda () 7) 'not-a-procedure))
+           #f)
+(test-comp '(module ? racket/base
+              (define f (lambda (x) (list x 0)))
+              (lambda () (display f) (f 7)))
+           '(module ? racket/base
+              (define f (lambda (x) (list x 0)))
+              (lambda () (display f) (call-with-values (lambda () 7) f))))
+(test-comp '(module ? racket/base
+              (define f (let ([tmp (list 0)]) (lambda (x) (list x tmp))))
+              (lambda () (f 7)))
+           '(module ? racket/base
+              (define f (let ([tmp (list 0)]) (lambda (x) (list x tmp))))
+              (lambda () (call-with-values (lambda () 7) f))))
+
 ;; ;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;
 ;; Inlining with higher-order functions:
 
@@ -4520,7 +4542,7 @@
              (report-answer-all 8)))))))
 
 ;; ;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;
-;; Check that cross-module inlining decmopiles a function
+;; Check that cross-module inlining decompiles a function
 ;; with correct use counts on arguments (specifically: B is used
 ;; twice, so the argument expression can't be inlined for two uses)
 
diff --git a/racket/src/racket/src/optimize.c b/racket/src/racket/src/optimize.c
index 2f630e17be..fe2d89e7c6 100644
--- a/racket/src/racket/src/optimize.c
+++ b/racket/src/racket/src/optimize.c
@@ -3626,7 +3626,10 @@ Scheme_Object *scheme_optimize_apply_values(Scheme_Object *f, Scheme_Object *e,
     if (rev) {
       int rator2_flags;
       Scheme_Object *o_f;
-      o_f = optimize_for_inline(info, rev, 1, NULL, NULL, NULL, &rator2_flags, context, 0, 0);
+      o_f = lookup_constant_proc(info, rev, 0);
+      if (!o_f)
+        o_f = optimize_for_inline(info, rev, 1, NULL, NULL, NULL, &rator2_flags, context, 0, 0);
+
       if (o_f) {
         f_is_proc = rev;