diff --git a/ChangeLog b/ChangeLog
index 29577d8c0..df2789bb6 100644
--- a/ChangeLog
+++ b/ChangeLog
@@ -1,3 +1,8 @@
+2012-02-29  Vladimir Serbinenko  <phcoder@gmail.com>
+
+	* configure.ac: Move -fnested-functions to CPPFLAGS to workaround
+	Apple bug.
+
 2012-02-29  Vladimir Serbinenko  <phcoder@gmail.com>
 
 	* grub-core/Makefile.am (MACHO2IMG): Add missing variable.
diff --git a/configure.ac b/configure.ac
index 6a9eafd39..b50f3c930 100644
--- a/configure.ac
+++ b/configure.ac
@@ -301,8 +301,8 @@ AC_CHECK_SIZEOF(long)
 
 grub_apple_cc
 if test x$grub_cv_apple_cc = xyes ; then
-  HOST_CPPFLAGS="$HOST_CPPFLAGS -DAPPLE_CC=1"
-  HOST_CFLAGS="$HOST_CFLAGS -fnested-functions"
+  HOST_CPPFLAGS="$HOST_CPPFLAGS -DAPPLE_CC=1 -fnested-functions"
+  HOST_CFLAGS="$HOST_CFLAGS"
 fi
 
 if test x$USE_NLS = xno; then
@@ -454,7 +454,7 @@ fi
 grub_apple_target_cc
 if test x$grub_cv_apple_target_cc = xyes ; then
   TARGET_CPPFLAGS="$TARGET_CPPFLAGS -DAPPLE_CC=1"
-  TARGET_CFLAGS="$TARGET_CFLAGS -fnested-functions"
+  TARGET_CPPFLAGS="$TARGET_CPPFLAGS -fnested-functions"
 
   CFLAGS="$CFLAGS -DAPPLE_CC=1 -fnested-functions"
   TARGET_APPLE_CC=1