diff --git a/src/compiler/checker.ts b/src/compiler/checker.ts
index b00073557ca..9a443e6c444 100644
--- a/src/compiler/checker.ts
+++ b/src/compiler/checker.ts
@@ -10369,7 +10369,15 @@ namespace ts {
             if (typeVariable) {
                 const mappedTypeVariable = instantiateType(typeVariable, mapper);
                 if (typeVariable !== mappedTypeVariable) {
-                    return mapType(mappedTypeVariable, t => {
+                    // If we are already in the process of creating an instantiation of this mapped type,
+                    // return the error type. This situation only arises if we are instantiating the mapped
+                    // type for an array or tuple type, as we then need to eagerly resolve the (possibly
+                    // circular) element type(s).
+                    if (type.instantiating) {
+                        return errorType;
+                    }
+                    type.instantiating = true;
+                    const result = mapType(mappedTypeVariable, t => {
                         if (t.flags & (TypeFlags.AnyOrUnknown | TypeFlags.InstantiableNonPrimitive | TypeFlags.Object | TypeFlags.Intersection) && t !== wildcardType) {
                             const replacementMapper = createReplacementMapper(typeVariable, t, mapper);
                             return isArrayType(t) ? createArrayType(instantiateMappedTypeTemplate(type, numberType, /*isOptional*/ true, replacementMapper)) :
@@ -10379,6 +10387,8 @@ namespace ts {
                         }
                         return t;
                     });
+                    type.instantiating = false;
+                    return result;
                 }
             }
             return instantiateAnonymousType(type, mapper);
diff --git a/src/compiler/types.ts b/src/compiler/types.ts
index 3bd103579f1..5763ab3eff0 100644
--- a/src/compiler/types.ts
+++ b/src/compiler/types.ts
@@ -4074,6 +4074,7 @@ namespace ts {
         templateType?: Type;
         modifiersType?: Type;
         resolvedApparentType?: Type;
+        instantiating?: boolean;
     }
 
     export interface EvolvingArrayType extends ObjectType {
diff --git a/tests/baselines/reference/recursiveMappedTypes.errors.txt b/tests/baselines/reference/recursiveMappedTypes.errors.txt
index 8279f4f60a6..b702cf7e316 100644
--- a/tests/baselines/reference/recursiveMappedTypes.errors.txt
+++ b/tests/baselines/reference/recursiveMappedTypes.errors.txt
@@ -31,4 +31,14 @@ tests/cases/conformance/types/mapped/recursiveMappedTypes.ts(12,11): error TS231
         [K in keyof Recurse1]: Recurse1[K]
               ~~~~~~~~~~~~~~
 !!! error TS2313: Type parameter 'K' has a circular constraint.
-    }
\ No newline at end of file
+    }
+    
+    // Repro from #27881
+    
+    export type Circular<T> = {[P in keyof T]: Circular<T>};
+    type tup = [number, number, number, number];
+    
+    function foo(arg: Circular<tup>): tup {
+      return arg;
+    }
+    
\ No newline at end of file
diff --git a/tests/baselines/reference/recursiveMappedTypes.js b/tests/baselines/reference/recursiveMappedTypes.js
index 50610708664..612c9d3fca4 100644
--- a/tests/baselines/reference/recursiveMappedTypes.js
+++ b/tests/baselines/reference/recursiveMappedTypes.js
@@ -11,19 +11,28 @@ type Recurse1 = {
 
 type Recurse2 = {
     [K in keyof Recurse1]: Recurse1[K]
-}
+}
+
+// Repro from #27881
+
+export type Circular<T> = {[P in keyof T]: Circular<T>};
+type tup = [number, number, number, number];
+
+function foo(arg: Circular<tup>): tup {
+  return arg;
+}
+
 
 //// [recursiveMappedTypes.js]
+"use strict";
 // Recursive mapped types simply appear empty
+exports.__esModule = true;
+function foo(arg) {
+    return arg;
+}
 
 
 //// [recursiveMappedTypes.d.ts]
-declare type Recurse = {
-    [K in keyof Recurse]: Recurse[K];
-};
-declare type Recurse1 = {
-    [K in keyof Recurse2]: Recurse2[K];
-};
-declare type Recurse2 = {
-    [K in keyof Recurse1]: Recurse1[K];
+export declare type Circular<T> = {
+    [P in keyof T]: Circular<T>;
 };
diff --git a/tests/baselines/reference/recursiveMappedTypes.symbols b/tests/baselines/reference/recursiveMappedTypes.symbols
index 20ebbedc00a..7c0e2ffaa23 100644
--- a/tests/baselines/reference/recursiveMappedTypes.symbols
+++ b/tests/baselines/reference/recursiveMappedTypes.symbols
@@ -30,3 +30,28 @@ type Recurse2 = {
 >Recurse1 : Symbol(Recurse1, Decl(recursiveMappedTypes.ts, 4, 1))
 >K : Symbol(K, Decl(recursiveMappedTypes.ts, 11, 5))
 }
+
+// Repro from #27881
+
+export type Circular<T> = {[P in keyof T]: Circular<T>};
+>Circular : Symbol(Circular, Decl(recursiveMappedTypes.ts, 12, 1))
+>T : Symbol(T, Decl(recursiveMappedTypes.ts, 16, 21))
+>P : Symbol(P, Decl(recursiveMappedTypes.ts, 16, 28))
+>T : Symbol(T, Decl(recursiveMappedTypes.ts, 16, 21))
+>Circular : Symbol(Circular, Decl(recursiveMappedTypes.ts, 12, 1))
+>T : Symbol(T, Decl(recursiveMappedTypes.ts, 16, 21))
+
+type tup = [number, number, number, number];
+>tup : Symbol(tup, Decl(recursiveMappedTypes.ts, 16, 56))
+
+function foo(arg: Circular<tup>): tup {
+>foo : Symbol(foo, Decl(recursiveMappedTypes.ts, 17, 44))
+>arg : Symbol(arg, Decl(recursiveMappedTypes.ts, 19, 13))
+>Circular : Symbol(Circular, Decl(recursiveMappedTypes.ts, 12, 1))
+>tup : Symbol(tup, Decl(recursiveMappedTypes.ts, 16, 56))
+>tup : Symbol(tup, Decl(recursiveMappedTypes.ts, 16, 56))
+
+  return arg;
+>arg : Symbol(arg, Decl(recursiveMappedTypes.ts, 19, 13))
+}
+
diff --git a/tests/baselines/reference/recursiveMappedTypes.types b/tests/baselines/reference/recursiveMappedTypes.types
index aae3280b605..5741f711e9d 100644
--- a/tests/baselines/reference/recursiveMappedTypes.types
+++ b/tests/baselines/reference/recursiveMappedTypes.types
@@ -18,3 +18,20 @@ type Recurse2 = {
 
     [K in keyof Recurse1]: Recurse1[K]
 }
+
+// Repro from #27881
+
+export type Circular<T> = {[P in keyof T]: Circular<T>};
+>Circular : Circular<T>
+
+type tup = [number, number, number, number];
+>tup : [number, number, number, number]
+
+function foo(arg: Circular<tup>): tup {
+>foo : (arg: [any, any, any, any]) => [number, number, number, number]
+>arg : [any, any, any, any]
+
+  return arg;
+>arg : [any, any, any, any]
+}
+
diff --git a/tests/cases/conformance/types/mapped/recursiveMappedTypes.ts b/tests/cases/conformance/types/mapped/recursiveMappedTypes.ts
index 7a78ad9dc4a..188efa2f51a 100644
--- a/tests/cases/conformance/types/mapped/recursiveMappedTypes.ts
+++ b/tests/cases/conformance/types/mapped/recursiveMappedTypes.ts
@@ -12,4 +12,13 @@ type Recurse1 = {
 
 type Recurse2 = {
     [K in keyof Recurse1]: Recurse1[K]
-}
\ No newline at end of file
+}
+
+// Repro from #27881
+
+export type Circular<T> = {[P in keyof T]: Circular<T>};
+type tup = [number, number, number, number];
+
+function foo(arg: Circular<tup>): tup {
+  return arg;
+}