diff --git a/lib/compress.js b/lib/compress.js
index 4e45df92..0c6e4c31 100644
--- a/lib/compress.js
+++ b/lib/compress.js
@@ -1273,7 +1273,21 @@ merge(Compressor.prototype, {
         def(AST_Constant, return_false);
         def(AST_This, return_false);
 
+        var pure_regex = /[@#]__PURE__/;
+        function has_pure_annotation(node) {
+            if (node.pure !== undefined) return node.pure;
+            var pure = false;
+            if (node.start
+                && node.start.comments_before
+                && node.start.comments_before.length
+                && pure_regex.test(node.start.comments_before[node.start.comments_before.length - 1].value)) {
+                pure = true;
+            }
+            return node.pure = pure;
+        }
+
         def(AST_Call, function(compressor){
+            if (has_pure_annotation(this)) return false;
             var pure = compressor.option("pure_funcs");
             if (!pure) return true;
             if (typeof pure == "function") return pure(this);
diff --git a/test/compress/issue-1261.js b/test/compress/issue-1261.js
new file mode 100644
index 00000000..beb00949
--- /dev/null
+++ b/test/compress/issue-1261.js
@@ -0,0 +1,51 @@
+pure_function_calls: {
+    options = {
+        evaluate     : true,
+        conditionals : true,
+        comparisons  : true,
+        side_effects : true,
+        booleans     : true,
+        unused       : true,
+        if_return    : true,
+        join_vars    : true,
+        cascade      : true,
+        negate_iife  : true,
+    }
+    input: {
+        // pure top-level IIFE will be dropped
+        // @__PURE__ - comment
+        (function() {
+            console.log("iife0");
+        })();
+
+        // pure top-level IIFE assigned to unreferenced var will not be dropped
+        var iife1 = /*@__PURE__*/(function() {
+            console.log("iife1");
+            function iife1() {}
+            return iife1;
+        })();
+
+        (function(){
+            // pure IIFE in function scope assigned to unreferenced var will be dropped
+            var iife2 = /*#__PURE__*/(function() {
+                console.log("iife2");
+                function iife2() {}
+                return iife2;
+            })();
+        })();
+
+        // comment #__PURE__ comment
+        bar(), baz(), quux();
+        a.b(), /* @__PURE__ */ c.d.e(), f.g();
+    }
+    expect: {
+        var iife1 = function() {
+            console.log("iife1");
+            function iife1() {}
+            return iife1;
+        }();
+
+        baz(), quux();
+        a.b(), f.g();
+    }
+}