diff --git a/crates/red_knot_python_semantic/src/types.rs b/crates/red_knot_python_semantic/src/types.rs
index 8a9972bd6b289..3eb267638ab1a 100644
--- a/crates/red_knot_python_semantic/src/types.rs
+++ b/crates/red_knot_python_semantic/src/types.rs
@@ -326,7 +326,7 @@ impl<'db> Type<'db> {
     #[must_use]
     pub fn call(&self, db: &'db dyn Db) -> Option<Type<'db>> {
         match self {
-            Type::Function(function_type) => function_type.returns(db).or(Some(Type::Unknown)),
+            Type::Function(function_type) => Some(function_type.return_type(db)),
 
             // TODO annotated return type on `__new__` or metaclass `__call__`
             Type::Class(class) => Some(Type::Instance(*class)),
@@ -374,21 +374,34 @@ impl<'db> FunctionType<'db> {
         self.decorators(db).contains(&decorator)
     }
 
-    /// annotated return type for this function, if any
-    pub fn returns(&self, db: &'db dyn Db) -> Option<Type<'db>> {
+    /// inferred return type for this function
+    pub fn return_type(&self, db: &'db dyn Db) -> Type<'db> {
         let definition = self.definition(db);
         let DefinitionKind::Function(function_stmt_node) = definition.node(db) else {
             panic!("Function type definition must have `DefinitionKind::Function`")
         };
 
-        function_stmt_node.returns.as_ref().map(|returns| {
-            if function_stmt_node.is_async {
-                // TODO: generic `types.CoroutineType`!
-                Type::Unknown
-            } else {
-                definition_expression_ty(db, definition, returns.as_ref())
-            }
-        })
+        // TODO if a function `bar` is decorated by `foo`,
+        // where `foo` is annotated as returning a type `X` that is a subtype of `Callable`,
+        // we need to infer the return type from `X`'s return annotation
+        // rather than from `bar`'s return annotation
+        // in order to determine the type that `bar` returns
+        if !function_stmt_node.decorator_list.is_empty() {
+            return Type::Unknown;
+        }
+
+        function_stmt_node
+            .returns
+            .as_ref()
+            .map(|returns| {
+                if function_stmt_node.is_async {
+                    // TODO: generic `types.CoroutineType`!
+                    Type::Unknown
+                } else {
+                    definition_expression_ty(db, definition, returns.as_ref())
+                }
+            })
+            .unwrap_or(Type::Unknown)
     }
 }
 
diff --git a/crates/red_knot_python_semantic/src/types/infer.rs b/crates/red_knot_python_semantic/src/types/infer.rs
index 2cd8ac2ed821d..5d0abf46b73d5 100644
--- a/crates/red_knot_python_semantic/src/types/infer.rs
+++ b/crates/red_knot_python_semantic/src/types/infer.rs
@@ -2806,10 +2806,7 @@ mod tests {
             panic!("example is not a function");
         };
 
-        let returns = function
-            .returns(&db)
-            .expect("There is a return type on the function");
-
+        let returns = function.return_type(&db);
         assert_eq!(returns.display(&db).to_string(), "int");
 
         Ok(())
@@ -2854,6 +2851,35 @@ mod tests {
         Ok(())
     }
 
+    #[test]
+    fn basic_decorated_call_expression() -> anyhow::Result<()> {
+        let mut db = setup_db();
+
+        db.write_dedented(
+            "src/a.py",
+            "
+            from typing import Callable
+
+            def foo() -> int:
+                return 42
+
+            def decorator(func) -> Callable[[], int]:
+                return foo
+
+            @decorator
+            def bar() -> str:
+                return 'bar'
+
+            x = bar()
+            ",
+        )?;
+
+        // TODO: should be `int`!
+        assert_public_ty(&db, "src/a.py", "x", "Unknown");
+
+        Ok(())
+    }
+
     #[test]
     fn class_constructor_call_expression() -> anyhow::Result<()> {
         let mut db = setup_db();