diff --git a/crates/nu-cli/src/cli.rs b/crates/nu-cli/src/cli.rs
index afc1035ea..156000033 100644
--- a/crates/nu-cli/src/cli.rs
+++ b/crates/nu-cli/src/cli.rs
@@ -848,6 +848,8 @@ async fn process_line(
 
             classified_block.block.expand_it_usage();
 
+            trace!("{:#?}", classified_block);
+
             match run_block(&classified_block.block, ctx, input_stream, &Scope::empty()).await {
                 Ok(input) => {
                     // Running a pipeline gives us back a stream that we can then
diff --git a/crates/nu-protocol/src/hir.rs b/crates/nu-protocol/src/hir.rs
index 712c59faf..1b63c5117 100644
--- a/crates/nu-protocol/src/hir.rs
+++ b/crates/nu-protocol/src/hir.rs
@@ -105,6 +105,51 @@ impl ClassifiedCommand {
             _ => false,
         }
     }
+
+    pub fn expand_it_usage(&mut self) {
+        match self {
+            ClassifiedCommand::Internal(command) => {
+                if let SpannedExpression {
+                    expr: Expression::Literal(Literal::String(s)),
+                    ..
+                } = &*command.args.head
+                {
+                    if s == "run_external" {
+                        // For now, don't it-expand externals
+                        return;
+                    }
+                }
+
+                if let Some(positionals) = &mut command.args.positional {
+                    for arg in positionals {
+                        if let SpannedExpression {
+                            expr: Expression::Block(block),
+                            ..
+                        } = arg
+                        {
+                            block.expand_it_usage();
+                        }
+                    }
+                }
+            }
+            ClassifiedCommand::Expr(expr) => {
+                if let SpannedExpression {
+                    expr: Expression::Block(ref block),
+                    span,
+                } = **expr
+                {
+                    let mut block = block.clone();
+                    block.expand_it_usage();
+                    *expr = Box::new(SpannedExpression {
+                        expr: Expression::Block(block),
+                        span,
+                    });
+                }
+            }
+
+            _ => {}
+        }
+    }
 }
 
 #[derive(Debug, Clone, PartialEq, PartialOrd, Eq, Ord, Hash, Serialize, Deserialize)]
@@ -125,6 +170,9 @@ impl Commands {
     /// Convert all shallow uses of $it to `each { use of $it }`, converting each to a per-row command
     pub fn expand_it_usage(&mut self) {
         for idx in 0..self.list.len() {
+            self.list[idx].expand_it_usage();
+        }
+        for idx in 1..self.list.len() {
             if self.list[idx].has_it_iteration() {
                 self.list[idx] = ClassifiedCommand::Internal(InternalCommand {
                     name: "each".to_string(),
diff --git a/tests/shell/pipeline/commands/internal.rs b/tests/shell/pipeline/commands/internal.rs
index d58c70d39..d08f0fefd 100644
--- a/tests/shell/pipeline/commands/internal.rs
+++ b/tests/shell/pipeline/commands/internal.rs
@@ -107,7 +107,9 @@ mod parse {
 }
 
 mod tilde_expansion {
-    use super::nu;
+    use nu_test_support::fs::Stub::EmptyFile;
+    use nu_test_support::playground::Playground;
+    use nu_test_support::{nu, pipeline};
 
     #[test]
     #[should_panic]
@@ -136,4 +138,28 @@ mod tilde_expansion {
 
         assert_eq!(actual, "1~1");
     }
+
+    #[test]
+    fn proper_it_expansion() {
+        Playground::setup("ls_test_1", |dirs, sandbox| {
+            sandbox.with_files(vec![
+                EmptyFile("andres.txt"),
+                EmptyFile("gedge.txt"),
+                EmptyFile("jonathan.txt"),
+                EmptyFile("yehuda.txt"),
+            ]);
+
+            let actual = nu!(
+                cwd: dirs.test(), pipeline(
+                r#"
+                    ls | sort-by name | group-by type | each { get File.name | echo $it } | to-json
+                "#
+            ));
+
+            assert_eq!(
+                actual,
+                r#"["andres.txt","gedge.txt","jonathan.txt","yehuda.txt"]"#
+            );
+        })
+    }
 }