diff --git a/lib/util/Components.js b/lib/util/Components.js
index fec2d2e50e..6c4f18e074 100644
--- a/lib/util/Components.js
+++ b/lib/util/Components.js
@@ -362,12 +362,13 @@ function componentRule(rule, context) {
         var isFunction = /Function/.test(node.type); // Functions
         var isMethod = node.parent && node.parent.type === 'MethodDefinition'; // Classes methods
         var isArgument = node.parent && node.parent.type === 'CallExpression'; // Arguments (callback, etc.)
+        var isJSX = node.parent && node.parent.type === 'JSXExpressionContainer';
         // Stop moving up if we reach a class or an argument (like a callback)
         if (isClass || isArgument) {
           return null;
         }
         // Return the node if it is a function that is not a class method
-        if (isFunction && !isMethod) {
+        if (isFunction && !isMethod && !isJSX) {
           return node;
         }
         scope = scope.upper;
diff --git a/tests/lib/rules/no-unused-prop-types.js b/tests/lib/rules/no-unused-prop-types.js
index 8d255add46..02a6032273 100644
--- a/tests/lib/rules/no-unused-prop-types.js
+++ b/tests/lib/rules/no-unused-prop-types.js
@@ -1428,6 +1428,39 @@ ruleTester.run('no-unused-prop-types', rule, {
         '};'
       ].join('\n'),
       parserOptions: parserOptions
+    }, {
+      // `no-unused-prop-types` in jsx expressions - [Issue #885]
+      code: [
+        'const PagingBlock = function(props) {',
+        '  return (',
+        '    <span>',
+        '      <a onClick={() => props.previousPage()}/>',
+        '      <a onClick={() => props.nextPage()}/>',
+        '    </span>',
+        ' );',
+        '};',
+
+        'PagingBlock.propTypes = {',
+        '  nextPage: React.PropTypes.func.isRequired,',
+        '  previousPage: React.PropTypes.func.isRequired,',
+        '};'
+      ].join('\n'),
+      parserOptions: parserOptions
+    }, {
+      // `no-unused-prop-types` rest param props in jsx expressions - [Issue #885]
+      code: [
+        'const PagingBlock = function(props) {',
+        '  return (',
+        '    <SomeChild {...props} />',
+        ' );',
+        '};',
+
+        'PagingBlock.propTypes = {',
+        '  nextPage: React.PropTypes.func.isRequired,',
+        '  previousPage: React.PropTypes.func.isRequired,',
+        '};'
+      ].join('\n'),
+      parserOptions: parserOptions
     }
   ],