diff --git a/.chronus/changes/fix-mapper-model-expression-2024-7-12-17-20-15.md b/.chronus/changes/fix-mapper-model-expression-2024-7-12-17-20-15.md
new file mode 100644
index 000000000..2bf58aa59
--- /dev/null
+++ b/.chronus/changes/fix-mapper-model-expression-2024-7-12-17-20-15.md
@@ -0,0 +1,8 @@
+---
+# Change versionKind to one of: internal, fix, dependencies, feature, deprecation, breaking
+changeKind: fix
+packages:
+  - "@typespec/compiler"
+---
+
+Fix: Model and union expression in template were not considered as template instances
diff --git a/packages/compiler/src/core/checker.ts b/packages/compiler/src/core/checker.ts
index c7ccc5927..f7b9668ee 100644
--- a/packages/compiler/src/core/checker.ts
+++ b/packages/compiler/src/core/checker.ts
@@ -2007,6 +2007,8 @@ export function createChecker(program: Program): Checker {
       }
     }
 
+    linkMapper(unionType, mapper);
+
     return unionType;
   }
 
@@ -4010,6 +4012,7 @@ export function createChecker(program: Program): Checker {
       derivedModels: [],
       sourceModels: [],
     });
+    linkMapper(type, mapper);
     checkModelProperties(node, properties, type, mapper);
     return finishType(type);
   }
diff --git a/packages/compiler/test/type-utils.test.ts b/packages/compiler/test/type-utils.test.ts
index 3ec9b121b..e4ba79b8e 100644
--- a/packages/compiler/test/type-utils.test.ts
+++ b/packages/compiler/test/type-utils.test.ts
@@ -45,6 +45,36 @@ describe("compiler: type-utils", () => {
       ok(isTemplateInstance(Foo), "Should BE a template instance");
       ok(!isTemplateDeclaration(Foo), "Should NOT be a template declaration");
     });
+
+    it("check model expression inside a template instance is also a template instance", async () => {
+      const { Bar } = (await runner.compile(`
+      model Foo<T> {a: { b: T }};
+
+      @test model Bar {
+        foo: Foo<string> 
+      }
+      `)) as { Bar: Model };
+      const Foo = Bar.properties.get("foo")!.type as Model;
+      const expr = Foo.properties.get("a")!.type;
+
+      ok(isTemplateInstance(expr), "Should BE a template instance");
+      ok(!isTemplateDeclaration(expr), "Should NOT be a template declaration");
+    });
+
+    it("check union expression inside a template instance is also a template instance", async () => {
+      const { Bar } = (await runner.compile(`
+      model Foo<T> {a: int32 | T};
+
+      @test model Bar {
+        foo: Foo<string> 
+      }
+      `)) as { Bar: Model };
+      const Foo = Bar.properties.get("foo")!.type as Model;
+      const expr = Foo.properties.get("a")!.type;
+
+      ok(isTemplateInstance(expr), "Should BE a template instance");
+      ok(!isTemplateDeclaration(expr), "Should NOT be a template declaration");
+    });
   });
 
   describe("definition utils", () => {
diff --git a/packages/versioning/test/versioned-dependencies.test.ts b/packages/versioning/test/versioned-dependencies.test.ts
index 6fe362308..f0c907cf5 100644
--- a/packages/versioning/test/versioned-dependencies.test.ts
+++ b/packages/versioning/test/versioned-dependencies.test.ts
@@ -208,6 +208,48 @@ describe("versioning: reference versioned library", () => {
           "The provided version 'v2' from 'TestServiceVersions' is not declared as a version enum. Use '@versioned(TestServiceVersions)' on the containing namespace.",
       });
     });
+
+    it("doesn't emit diagnostic when library template with model expression instantiated with user model", async () => {
+      const diagnostics = await runner.diagnose(`
+        namespace Library {
+        model Template<T> {
+            a: {
+              b: T;
+            };
+          }
+        }
+
+        @versioned(Versions)
+        namespace Api {
+          enum Versions { v1 }
+
+          model Model {}
+
+          model Issue is Library.Template<Model>;
+        }
+    `);
+      expectDiagnosticEmpty(diagnostics);
+    });
+
+    it("doesn't emit diagnostic when library template with union expression instantiated with user model", async () => {
+      const diagnostics = await runner.diagnose(`
+        namespace Library {
+        model Template<T> {
+            a: string | T;
+          }
+        }
+
+        @versioned(Versions)
+        namespace Api {
+          enum Versions { v1 }
+
+          model Model {}
+
+          model Issue is Library.Template<Model>;
+        }
+    `);
+      expectDiagnosticEmpty(diagnostics);
+    });
   });
 
   describe("when using versioned library without @useDependency", () => {