diff --git a/pyrefly/lib/solver/subset.rs b/pyrefly/lib/solver/subset.rs
index 0a586bc87e..061efd1b09 100644
--- a/pyrefly/lib/solver/subset.rs
+++ b/pyrefly/lib/solver/subset.rs
@@ -2783,6 +2783,16 @@ impl<'solver, 'subset, Ans: LookupAnswer> Subset<'solver, 'subset, Ans> {
                 Ok(())
             }
             (Type::QuantifiedValue(_), Type::ClassType(cls)) if is_int_class_type(cls) => Ok(()),
+            (Type::ClassType(got_cls), Type::Literal(lit))
+                if let Lit::Enum(enum_lit) = &lit.value
+                    && got_cls.class_object() == enum_lit.class.class_object()
+                    && self
+                        .type_order
+                        .get_enum_member_count(got_cls.class_object())
+                        == Some(1) =>
+            {
+                Ok(())
+            }
             (Type::Literal(l_lit), Type::Literal(u_lit)) => {
                 ok_or(l_lit.value == u_lit.value, SubsetError::Other)
             }
diff --git a/pyrefly/lib/test/enums.rs b/pyrefly/lib/test/enums.rs
index 927737a400..44618ea355 100644
--- a/pyrefly/lib/test/enums.rs
+++ b/pyrefly/lib/test/enums.rs
@@ -438,6 +438,7 @@ def f(test: bool, e1: E1, e2: E2):
     x: Literal[E1.X, E1.Y] = e1
     y: Literal[E1.X, E1.Y, 1] = e1
     z: Literal[E2.X, E2.Y] = e2  # E: `E2` is not assignable to `Literal[E2.X, E2.Y]`
+    single: Literal[E2.X] = e2  # E: `E2` is not assignable to `Literal[E2.X]`
     "#,
 );
 
diff --git a/pyrefly/lib/test/type_alias.rs b/pyrefly/lib/test/type_alias.rs
index bfd56e5b15..d8204596ae 100644
--- a/pyrefly/lib/test/type_alias.rs
+++ b/pyrefly/lib/test/type_alias.rs
@@ -160,6 +160,78 @@ def f(x: X[int]):
     "#,
 );
 
+testcase!(
+    test_generic_alias_union_with_enum_literal,
+    r#"
+from enum import Enum
+from typing import Literal, TypeAlias, TypeVar, assert_type
+
+T = TypeVar("T")
+
+class Unset(Enum):
+    _UNSET = "UNSET"
+
+UNSET: Literal[Unset._UNSET] = Unset._UNSET
+UnsetType: TypeAlias = Literal[Unset._UNSET]
+Missing: TypeAlias = UnsetType | T | None
+
+def takes(x: Missing[Literal["a", "b"]]) -> None: ...
+
+def or_unset[U](v: U | None) -> U | Literal[Unset._UNSET]:
+    return UNSET if v is None else v
+
+def f(s: Literal["a"] | None) -> None:
+    assert_type(or_unset(s), Literal["a"] | Literal[Unset._UNSET])
+    assert_type(s, Literal["a"] | None)
+    takes(or_unset(s))
+"#,
+);
+
+testcase!(
+    test_generic_alias_union_with_enum_literal_direct_argument,
+    r#"
+from enum import Enum
+from typing import Literal, TypeAlias, TypeVar
+
+T = TypeVar("T")
+
+class Unset(Enum):
+    _UNSET = "UNSET"
+
+UnsetType: TypeAlias = Literal[Unset._UNSET]
+Missing: TypeAlias = UnsetType | T | None
+
+def takes(x: Missing[Literal["a", "b"]]) -> None: ...
+
+def f(x: Literal["a"] | Literal[Unset._UNSET] | None) -> None:
+    takes(x)
+"#,
+);
+
+testcase!(
+    test_generic_alias_union_with_inline_enum_literal,
+    r#"
+from enum import Enum
+from typing import Literal, TypeAlias, TypeVar
+
+T = TypeVar("T")
+
+class Unset(Enum):
+    _UNSET = "UNSET"
+
+UNSET: Literal[Unset._UNSET] = Unset._UNSET
+Missing: TypeAlias = Literal[Unset._UNSET] | T | None
+
+def takes(x: Missing[Literal["a", "b"]]) -> None: ...
+
+def or_unset[U](v: U | None) -> U | Literal[Unset._UNSET]:
+    return UNSET if v is None else v
+
+def f(s: Literal["a"] | None) -> None:
+    takes(or_unset(s))
+"#,
+);
+
 testcase!(
     test_ordinary_alias_union_retains_precise_members,
     r#"
@@ -1396,3 +1468,21 @@ X: TypeAlias = int | str
 X()  # E: Expected a callable
     "#,
 );
+
+testcase!(
+    test_enum_literal_union_member_compatibility,
+    r#"
+from enum import Enum
+from typing import Literal
+
+class Unset(Enum):
+    _UNSET = "UNSET"
+
+def takes_member(x: Literal["a", "b", Unset._UNSET] | None) -> None: ...
+def takes_class(x: Literal["a", "b"] | Unset | None) -> None: ...
+
+def f(x: Literal["a"] | Literal[Unset._UNSET] | None) -> None:
+    takes_member(x)
+    takes_class(x)
+"#,
+);