diff --git a/pkg/analyzer/lib/src/generated/resolver.dart b/pkg/analyzer/lib/src/generated/resolver.dart
index 4a70c667c78..017f2e39402 100644
--- a/pkg/analyzer/lib/src/generated/resolver.dart
+++ b/pkg/analyzer/lib/src/generated/resolver.dart
@@ -4719,12 +4719,9 @@ class InferenceContext {
     if (_returnStack.isEmpty) {
       return;
     }
-    DartType context = _returnStack.last;
-    if (context == null || context.isDynamic) {
-      DartType inferred = _inferredReturn.last;
-      inferred = _typeSystem.getLeastUpperBound(_typeProvider, type, inferred);
-      _inferredReturn[_inferredReturn.length - 1] = inferred;
-    }
+    DartType inferred = _inferredReturn.last;
+    inferred = _typeSystem.getLeastUpperBound(_typeProvider, type, inferred);
+    _inferredReturn[_inferredReturn.length - 1] = inferred;
   }
 
   /**
@@ -4746,15 +4743,14 @@ class InferenceContext {
    * bound of all types added with [addReturnOrYieldType].
    */
   void popReturnContext(BlockFunctionBody node) {
-    assert(_returnStack.isNotEmpty && _inferredReturn.isNotEmpty);
-    if (_returnStack.isNotEmpty) {
-      _returnStack.removeLast();
-    }
-    if (_inferredReturn.isNotEmpty) {
+    if (_returnStack.isNotEmpty && _inferredReturn.isNotEmpty) {
+      DartType context = _returnStack.removeLast() ?? DynamicTypeImpl.instance;
       DartType inferred = _inferredReturn.removeLast();
-      if (!inferred.isBottom) {
+      if (!inferred.isBottom && _typeSystem.isSubtypeOf(inferred, context)) {
         setType(node, inferred);
       }
+    } else {
+      assert(false);
     }
   }
 
diff --git a/pkg/analyzer/test/src/context/mock_sdk.dart b/pkg/analyzer/test/src/context/mock_sdk.dart
index 6539e675a1a..c584fa868b0 100644
--- a/pkg/analyzer/test/src/context/mock_sdk.dart
+++ b/pkg/analyzer/test/src/context/mock_sdk.dart
@@ -194,6 +194,10 @@ abstract class Iterable<E> {
 
   /*=R*/ fold/*<R>*/(/*=R*/ initialValue,
       /*=R*/ combine(/*=R*/ previousValue, E element));
+
+  Iterable/*<T>*/ expand/*<T>*/(Iterable/*<T>*/ f(E element));
+
+  List<E> toList();
 }
 
 class List<E> implements Iterable<E> {
diff --git a/pkg/analyzer/test/src/task/strong/inferred_type_test.dart b/pkg/analyzer/test/src/task/strong/inferred_type_test.dart
index 4dbcbfeba20..1b8d9713b14 100644
--- a/pkg/analyzer/test/src/task/strong/inferred_type_test.dart
+++ b/pkg/analyzer/test/src/task/strong/inferred_type_test.dart
@@ -2554,6 +2554,18 @@ main() {
     expect(fns[9].type.toString(), '() → Stream<int>');
   }
 
+  void test_inferReturnOfStatementLambda() {
+    // Regression test for https://github.com/dart-lang/sdk/issues/26139
+    checkFile(r'''
+List<String> strings() {
+  var stuff = [].expand(/*info:INFERRED_TYPE_CLOSURE*/(i) {
+    return <String>[];
+  });
+  return stuff.toList();
+}
+    ''');
+  }
+
   void test_inferred_nonstatic_field_depends_on_static_field_complex() {
     var mainUnit = checkFile('''
 class C {