diff --git a/src/Firely.Fhir.Validation.Compilation.Shared/SchemaBuilders/TypeReferenceBuilder.cs b/src/Firely.Fhir.Validation.Compilation.Shared/SchemaBuilders/TypeReferenceBuilder.cs
index 6eaecb06..5c1d57f3 100644
--- a/src/Firely.Fhir.Validation.Compilation.Shared/SchemaBuilders/TypeReferenceBuilder.cs
+++ b/src/Firely.Fhir.Validation.Compilation.Shared/SchemaBuilders/TypeReferenceBuilder.cs
@@ -191,13 +191,12 @@ private static bool shouldValidateTypeReference(ElementDefinitionNavigator nav)
                     ? new AllValidator(profileAssertions, validateReferenceAssertion)
                     : validateReferenceAssertion;
             }
-            else if (!ReferencedInstanceValidator.IsReferenceType(code) && typeRef.TargetProfile.Any())
-            {
-                throw new IncorrectElementDefinitionException($"Encountered targetProfiles {string.Join(",", typeRef.TargetProfile)} on an element that is not " +
-                    $"a reference type (canonical or Reference) but a {code}.");
-            }
             else
+            {
+                // A targetProfile on an element that is not a reference type (canonical or Reference) is
+                // meaningless, but not a reason to stop compiling the whole profile: ignore it.
                 return profileAssertions;
+            }
         }
 
 
diff --git a/test/Firely.Fhir.Validation.Compilation.Tests.R4/TargetProfileOnNonReferenceTests.cs b/test/Firely.Fhir.Validation.Compilation.Tests.R4/TargetProfileOnNonReferenceTests.cs
new file mode 100644
index 00000000..f0e53547
--- /dev/null
+++ b/test/Firely.Fhir.Validation.Compilation.Tests.R4/TargetProfileOnNonReferenceTests.cs
@@ -0,0 +1,71 @@
+/*
+ * Copyright (c) 2024, Firely (info@fire.ly) and contributors
+ * See the file CONTRIBUTORS for details.
+ *
+ * This file is licensed under the BSD 3-Clause license
+ * available at https://github.com/FirelyTeam/firely-validator-api/blob/main/LICENSE
+ */
+
+using FluentAssertions;
+using Hl7.Fhir.Model;
+using Hl7.Fhir.Specification.Source;
+using Hl7.Fhir.Specification.Terminology;
+using System.Linq;
+using Xunit;
+
+namespace Firely.Fhir.Validation.Tests
+{
+    public class TargetProfileOnNonReferenceTests
+    {
+        private const string PROFILE_URL = "http://example.org/fhir/StructureDefinition/TargetProfileOnNonReferenceTestProfile";
+
+        private static StructureDefinition profile(string type, params ElementDefinition[] differential) => new()
+        {
+            Url = PROFILE_URL,
+            Name = "TargetProfileOnNonReferenceTestProfile",
+            Status = PublicationStatus.Draft,
+            FhirVersion = FHIRVersion.N4_0_1,
+            Kind = StructureDefinition.StructureDefinitionKind.Resource,
+            Abstract = false,
+            Type = type,
+            BaseDefinition = $"http://hl7.org/fhir/StructureDefinition/{type}",
+            Derivation = StructureDefinition.TypeDerivationRule.Constraint,
+            Differential = new StructureDefinition.DifferentialComponent { Element = differential.ToList() }
+        };
+
+        private static OperationOutcome validate(StructureDefinition sd, Resource instance)
+        {
+            var source = new SnapshotSource(new MultiResolver(new InMemoryProfileResolver(sd), ZipSource.CreateValidationSource()));
+            var validator = new Validator(source.AsAsync(), new LocalTerminologyService(source.AsAsync()));
+            return validator.Validate(instance, PROFILE_URL);
+        }
+
+        /// <summary>
+        /// A targetProfile on an element that is not a reference is meaningless, but should not
+        /// prevent the profile from being compiled. See issue #423.
+        /// </summary>
+        [Fact]
+        public void TargetProfileOnNonReferenceTypeShouldBeIgnored()
+        {
+            var sd = profile("Patient",
+                new ElementDefinition("Patient.birthDate")
+                {
+                    ElementId = "Patient.birthDate",
+                    Type =
+                    [
+                        new ElementDefinition.TypeRefComponent
+                        {
+                            Code = "date",
+                            TargetProfile = ["http://hl7.org/fhir/StructureDefinition/Patient"]
+                        }
+                    ]
+                });
+
+            var patient = new Patient { BirthDate = "1974-12-25" };
+
+            var outcome = validate(sd, patient);
+
+            outcome.Success.Should().BeTrue(outcome.ToString());
+        }
+    }
+}