diff --git a/packages/eslint-plugin-react-hooks/__tests__/ESLintRuleNoNestedComponents-test.js b/packages/eslint-plugin-react-hooks/__tests__/ESLintRuleNoNestedComponents-test.js
index 380026f0ca8dc..b47635f9b2a98 100644
--- a/packages/eslint-plugin-react-hooks/__tests__/ESLintRuleNoNestedComponents-test.js
+++ b/packages/eslint-plugin-react-hooks/__tests__/ESLintRuleNoNestedComponents-test.js
@@ -846,6 +846,17 @@ const tests = {
         }))
       `,
     },
+    {
+      code: normalizeIndent`
+        function useCustomHook() {
+          const useNestedHook = () => {
+            React.useRef();
+          }
+          useNestedHook();
+          useNestedHook();
+        }
+      `,
+    },
   ],
   invalid: [
     {
diff --git a/packages/eslint-plugin-react-hooks/src/NoNestedComponents.js b/packages/eslint-plugin-react-hooks/src/NoNestedComponents.js
index e8b964fe5ab26..fce2e5de806dc 100644
--- a/packages/eslint-plugin-react-hooks/src/NoNestedComponents.js
+++ b/packages/eslint-plugin-react-hooks/src/NoNestedComponents.js
@@ -102,7 +102,7 @@ function isInsideComponentOrHook(node) {
 function isComponent(node) {
   const functionName = getFunctionName(node);
   if (functionName) {
-    if (isComponentName(functionName) || isHook(functionName)) {
+    if (isComponentName(functionName)) {
       return true;
     }
   }