diff --git a/app/controllers/timelog_controller.rb b/app/controllers/timelog_controller.rb
index 277b730a1..dfa96d2d7 100644
--- a/app/controllers/timelog_controller.rb
+++ b/app/controllers/timelog_controller.rb
@@ -262,12 +262,14 @@ private
   end
 
   def find_project
+    if (project_id = (params[:project_id] || params[:time_entry] && params[:time_entry][:project_id])).present?
+      @project = Project.find(project_id)
+    end
     if (issue_id = (params[:issue_id] || params[:time_entry] && params[:time_entry][:issue_id])).present?
       @issue = Issue.find(issue_id)
-      @project = @issue.project
-    elsif (project_id = (params[:project_id] || params[:time_entry] && params[:time_entry][:project_id])).present?
-      @project = Project.find(project_id)
-    else
+      @project ||= @issue.project
+    end
+    if @project.nil?
       render_404
       return false
     end
diff --git a/test/functional/timelog_controller_test.rb b/test/functional/timelog_controller_test.rb
index 8a68a5dbf..b5af1b5b8 100644
--- a/test/functional/timelog_controller_test.rb
+++ b/test/functional/timelog_controller_test.rb
@@ -209,6 +209,20 @@ class TimelogControllerTest < ActionController::TestCase
     assert_equal 1, time_entry.project_id
   end
 
+  def test_create_without_project_should_fail_with_issue_not_inside_project
+    @request.session[:user_id] = 2
+    assert_no_difference 'TimeEntry.count' do
+      post :create, :time_entry => {:project_id => '1',
+                                  :activity_id => '11',
+                                  :issue_id => '5',
+                                  :spent_on => '2008-03-14',
+                                  :hours => '7.3'}
+    end
+
+    assert_response :success
+    assert assigns(:time_entry).errors[:issue_id].present?
+  end
+
   def test_create_without_project_should_deny_without_permission
     @request.session[:user_id] = 2
     Project.find(3).disable_module!(:time_tracking)