diff --git a/CHANGELOG.asciidoc b/CHANGELOG.asciidoc
index 864acac52b..e8e14d88be 100644
--- a/CHANGELOG.asciidoc
+++ b/CHANGELOG.asciidoc
@@ -34,6 +34,7 @@ Use subheadings with the "=====" level for adding notes for unreleased changes:
 [float]
 ===== Bug fixes
 * Fix log4j2 log correlation with shaded application jar - {pull}3764[#3764]
+* Improve automatic span class name detection for Scala and nested/anonymous classes - {pull}3746[#3746]
 
 [float]
 ===== Features
diff --git a/apm-agent-plugin-sdk/src/main/java/co/elastic/apm/agent/sdk/bytebuddy/ClassNameParser.java b/apm-agent-plugin-sdk/src/main/java/co/elastic/apm/agent/sdk/bytebuddy/ClassNameParser.java
new file mode 100644
index 0000000000..d8c327d0ed
--- /dev/null
+++ b/apm-agent-plugin-sdk/src/main/java/co/elastic/apm/agent/sdk/bytebuddy/ClassNameParser.java
@@ -0,0 +1,102 @@
+/*
+ * Licensed to Elasticsearch B.V. under one or more contributor
+ * license agreements. See the NOTICE file distributed with
+ * this work for additional information regarding copyright
+ * ownership. Elasticsearch B.V. licenses this file to you under
+ * the Apache License, Version 2.0 (the "License"); you may
+ * not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *   http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing,
+ * software distributed under the License is distributed on an
+ * "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+ * KIND, either express or implied.  See the License for the
+ * specific language governing permissions and limitations
+ * under the License.
+ */
+package co.elastic.apm.agent.sdk.bytebuddy;
+
+/**
+ * Utility class to extract the correct simple class name
+ */
+public class ClassNameParser {
+    /**
+     * Utility class, do not instantiate
+     */
+    private ClassNameParser() {}
+    /**
+     * returns true if the string only contains digits
+     * @param str the string to check
+     * @return
+     */
+    private static boolean isNumeric(String str) {
+    	for(int i = 0; i< str.length(); i++) {
+    		if(!Character.isDigit(str.charAt(i))) {
+        		return false;
+    		}
+    	}
+    	return true;
+    }
+    /**
+     * this method parses the anonymous class name from the full class name
+     * @param className
+     * @return
+     */
+    private static String getAnonymousClassName(String className) {
+    	int lastDollarIndex = className.lastIndexOf('$');
+    	int currentDollarIndex;
+    	String nestedClassName;
+    	// we do not want to show just a number for anonymous classes, so we walk back until we find a named (normal or nested) class
+    	do {
+    		currentDollarIndex = className.lastIndexOf('$', lastDollarIndex -1);
+    		nestedClassName = className.substring(currentDollarIndex + 1, lastDollarIndex);
+    		lastDollarIndex = currentDollarIndex;
+    	} while(currentDollarIndex != -1 && isNumeric(nestedClassName));
+        return className.substring(currentDollarIndex + 1);
+    }
+    /**
+     * Parses the class name from nested and anonymous classes (containing a $ sign)
+     * <p>
+     * Note: We cannot know if the $ sign is part of the class name or denotes a nested/anonymous class. As $ signs should not be used in class names anyway,
+     *       we handle them always as a class separator
+     * </p>
+     * @param className
+     * @return
+     */
+    private static String getNestedClassName(String className) {
+        int dollarIndex = className.lastIndexOf('$');
+        String innerClassName = className.substring(dollarIndex + 1);
+        if(isNumeric(innerClassName)) {
+            // this is an anonymous inner class
+        	className = getAnonymousClassName(className);
+        } else {
+            className = innerClassName;
+        }
+        return className;
+    }
+    /**
+     * Parses the simple class name from a class name
+     * @param className
+     * @return
+     */
+    public static String parse(String className) {
+        //remove package name
+        className = className.substring(className.lastIndexOf('.') + 1);
+        if(className.contains("$")) {
+            if(className.endsWith("$")) {
+                // this can happen if the source code was in Scala and the object keyword was used
+                // https://www.toptal.com/scala/scala-bytecode-and-the-jvm
+                className = className.substring(0, className.length() - 1);
+                if(className.contains("$"))
+                {
+                	className = getNestedClassName(className);
+                }
+            } else {
+                className = getNestedClassName(className);
+            }
+        }
+        return className;
+    }
+}
diff --git a/apm-agent-plugin-sdk/src/main/java/co/elastic/apm/agent/sdk/bytebuddy/SimpleMethodSignatureOffsetMappingFactory.java b/apm-agent-plugin-sdk/src/main/java/co/elastic/apm/agent/sdk/bytebuddy/SimpleMethodSignatureOffsetMappingFactory.java
index d0bc841cd6..3df8507ea1 100644
--- a/apm-agent-plugin-sdk/src/main/java/co/elastic/apm/agent/sdk/bytebuddy/SimpleMethodSignatureOffsetMappingFactory.java
+++ b/apm-agent-plugin-sdk/src/main/java/co/elastic/apm/agent/sdk/bytebuddy/SimpleMethodSignatureOffsetMappingFactory.java
@@ -51,8 +51,7 @@ public Advice.OffsetMapping make(ParameterDescription.InDefinedShape target,
             public Target resolve(TypeDescription instrumentedType, MethodDescription instrumentedMethod, Assigner assigner,
                                   Advice.ArgumentHandler argumentHandler, Sort sort) {
                 final String className = instrumentedMethod.getDeclaringType().getTypeName();
-                String simpleClassName = className.substring(className.lastIndexOf('$') + 1);
-                simpleClassName = simpleClassName.substring(simpleClassName.lastIndexOf('.') + 1);
+                final String simpleClassName = ClassNameParser.parse(className);
                 final String signature = String.format("%s#%s", simpleClassName, instrumentedMethod.getName());
                 return Target.ForStackManipulation.of(signature);
             }
diff --git a/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/ClassNameParserTest.java b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/ClassNameParserTest.java
new file mode 100644
index 0000000000..bc76d3dd18
--- /dev/null
+++ b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/ClassNameParserTest.java
@@ -0,0 +1,83 @@
+/*
+ * Licensed to Elasticsearch B.V. under one or more contributor
+ * license agreements. See the NOTICE file distributed with
+ * this work for additional information regarding copyright
+ * ownership. Elasticsearch B.V. licenses this file to you under
+ * the Apache License, Version 2.0 (the "License"); you may
+ * not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *   http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing,
+ * software distributed under the License is distributed on an
+ * "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+ * KIND, either express or implied.  See the License for the
+ * specific language governing permissions and limitations
+ * under the License.
+ */
+package co.elastic.apm.agent.sdk.bytebuddy;
+
+import static org.assertj.core.api.Assertions.*;
+
+import org.junit.jupiter.api.Test;
+
+import co.elastic.apm.agent.sdk.bytebuddy.clazzes.ParentClass.InnerClass;
+import co.elastic.apm.agent.sdk.bytebuddy.clazzes.ParentClass.InnerClass.NestedInnerClass;
+import co.elastic.apm.agent.sdk.bytebuddy.clazzes.ParentObject.ChildScalaObject$;
+import co.elastic.apm.agent.sdk.bytebuddy.clazzes.SimpleClass;
+import co.elastic.apm.agent.sdk.bytebuddy.clazzes.AnonymousClass;
+import co.elastic.apm.agent.sdk.bytebuddy.clazzes.AnonymousNestedClass;
+import co.elastic.apm.agent.sdk.bytebuddy.clazzes.Dollar$Class;
+import co.elastic.apm.agent.sdk.bytebuddy.clazzes.ScalaObject$;
+
+class ClassNameParserTest {
+
+    @Test
+    void testSimpleClassName() {
+        String className = ClassNameParser.parse(SimpleClass.class.getName());
+        assertThat(className).isEqualTo("SimpleClass");
+    }
+    @Test
+    void testNestedClassName() {
+        String className = ClassNameParser.parse(InnerClass.class.getName());
+        assertThat(className).isEqualTo("InnerClass");
+    }
+    @Test
+    void testDoubleNestedClassName() {
+        String className = ClassNameParser.parse(NestedInnerClass.class.getName());
+        assertThat(className).isEqualTo("NestedInnerClass");
+    }
+    @Test
+    void testDollarClassName() {
+        String className = ClassNameParser.parse(Dollar$Class.class.getName());
+        //We have no way to know if the class name is Dollar$Class or Class is a nested class of Dollar
+        //As dollar signs should not be used in names, it should be fine to detect Class instead of Dollar$Class
+        assertThat(className).describedAs("Dollar signs should not be used in names").isEqualTo("Class");
+    }
+    @Test
+    void testAnonymousClassName() {
+        String className = ClassNameParser.parse(AnonymousClass.getAnonymousClass().getName());
+        assertThat(className).isEqualTo("AnonymousClass$1");
+    }
+    @Test
+    void testAnonymousNestedClassName() {
+        String className = ClassNameParser.parse(InnerClass.getAnonymousClass().getName());
+        assertThat(className).isEqualTo("InnerClass$1");
+    }
+    @Test
+    void testAnonymousInAnonymousClassName() {
+        String className = ClassNameParser.parse(AnonymousNestedClass.getAnonymousClass().getName());
+        assertThat(className).isEqualTo("AnonymousNestedClass$1$1");
+    }
+    @Test
+    void testScalaObjectClassName() {
+        String className = ClassNameParser.parse(ScalaObject$.class.getName());
+        assertThat(className).isEqualTo("ScalaObject");
+    }
+    @Test
+    void testNestedScalaObjectClassName() {
+        String className = ClassNameParser.parse(ChildScalaObject$.class.getName());
+        assertThat(className).isEqualTo("ChildScalaObject");
+    }
+}
diff --git a/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/AnonymousClass.java b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/AnonymousClass.java
new file mode 100644
index 0000000000..ec1234c2c7
--- /dev/null
+++ b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/AnonymousClass.java
@@ -0,0 +1,30 @@
+/*
+ * Licensed to Elasticsearch B.V. under one or more contributor
+ * license agreements. See the NOTICE file distributed with
+ * this work for additional information regarding copyright
+ * ownership. Elasticsearch B.V. licenses this file to you under
+ * the Apache License, Version 2.0 (the "License"); you may
+ * not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *   http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing,
+ * software distributed under the License is distributed on an
+ * "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+ * KIND, either express or implied.  See the License for the
+ * specific language governing permissions and limitations
+ * under the License.
+ */
+package co.elastic.apm.agent.sdk.bytebuddy.clazzes;
+
+public class AnonymousClass {
+    public static Class<?> getAnonymousClass() {
+        return new Object() {
+            @Override
+            public String toString() {
+                return "foo";
+            }
+        }.getClass();
+    }
+}
diff --git a/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/AnonymousNestedClass.java b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/AnonymousNestedClass.java
new file mode 100644
index 0000000000..14c01ce0cb
--- /dev/null
+++ b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/AnonymousNestedClass.java
@@ -0,0 +1,39 @@
+/*
+ * Licensed to Elasticsearch B.V. under one or more contributor
+ * license agreements. See the NOTICE file distributed with
+ * this work for additional information regarding copyright
+ * ownership. Elasticsearch B.V. licenses this file to you under
+ * the Apache License, Version 2.0 (the "License"); you may
+ * not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *   http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing,
+ * software distributed under the License is distributed on an
+ * "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+ * KIND, either express or implied.  See the License for the
+ * specific language governing permissions and limitations
+ * under the License.
+ */
+package co.elastic.apm.agent.sdk.bytebuddy.clazzes;
+
+public class AnonymousNestedClass {
+    public static Class<?> getAnonymousClass() {
+    	Factory f = new Factory() {
+            @Override
+            public Object getObject() {
+                return new Object() {
+                    @Override
+                    public String toString() {
+                        return "foo";
+                    }
+                };
+            }
+        };
+        return f.getObject().getClass();
+    }
+    public static interface Factory {
+    	Object getObject();
+    }
+}
diff --git a/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/Dollar$Class.java b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/Dollar$Class.java
new file mode 100644
index 0000000000..08aa4c7e3d
--- /dev/null
+++ b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/Dollar$Class.java
@@ -0,0 +1,23 @@
+/*
+ * Licensed to Elasticsearch B.V. under one or more contributor
+ * license agreements. See the NOTICE file distributed with
+ * this work for additional information regarding copyright
+ * ownership. Elasticsearch B.V. licenses this file to you under
+ * the Apache License, Version 2.0 (the "License"); you may
+ * not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *   http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing,
+ * software distributed under the License is distributed on an
+ * "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+ * KIND, either express or implied.  See the License for the
+ * specific language governing permissions and limitations
+ * under the License.
+ */
+package co.elastic.apm.agent.sdk.bytebuddy.clazzes;
+
+public class Dollar$Class {
+
+}
diff --git a/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/ParentClass.java b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/ParentClass.java
new file mode 100644
index 0000000000..99799af8bf
--- /dev/null
+++ b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/ParentClass.java
@@ -0,0 +1,36 @@
+/*
+ * Licensed to Elasticsearch B.V. under one or more contributor
+ * license agreements. See the NOTICE file distributed with
+ * this work for additional information regarding copyright
+ * ownership. Elasticsearch B.V. licenses this file to you under
+ * the Apache License, Version 2.0 (the "License"); you may
+ * not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *   http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing,
+ * software distributed under the License is distributed on an
+ * "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+ * KIND, either express or implied.  See the License for the
+ * specific language governing permissions and limitations
+ * under the License.
+ */
+package co.elastic.apm.agent.sdk.bytebuddy.clazzes;
+
+public class ParentClass {
+
+    public static class InnerClass {
+    	public static Class<?> getAnonymousClass() {
+	        return new Object() {
+	            @Override
+	            public String toString() {
+	                return "foo";
+	            }
+	        }.getClass();
+	    }
+    	public static class NestedInnerClass {
+    		
+    	}
+    }
+}
diff --git a/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/ParentObject.java b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/ParentObject.java
new file mode 100644
index 0000000000..3a73eeb973
--- /dev/null
+++ b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/ParentObject.java
@@ -0,0 +1,29 @@
+/*
+ * Licensed to Elasticsearch B.V. under one or more contributor
+ * license agreements. See the NOTICE file distributed with
+ * this work for additional information regarding copyright
+ * ownership. Elasticsearch B.V. licenses this file to you under
+ * the Apache License, Version 2.0 (the "License"); you may
+ * not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *   http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing,
+ * software distributed under the License is distributed on an
+ * "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+ * KIND, either express or implied.  See the License for the
+ * specific language governing permissions and limitations
+ * under the License.
+ */
+package co.elastic.apm.agent.sdk.bytebuddy.clazzes;
+
+public class ParentObject {
+    /**
+     * Scala objects generate a class with a dollar at the end
+     * https://www.toptal.com/scala/scala-bytecode-and-the-jvm
+     */
+    public class ChildScalaObject$ {
+
+    }
+}
diff --git a/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/ScalaObject$.java b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/ScalaObject$.java
new file mode 100644
index 0000000000..c20f336742
--- /dev/null
+++ b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/ScalaObject$.java
@@ -0,0 +1,27 @@
+/*
+ * Licensed to Elasticsearch B.V. under one or more contributor
+ * license agreements. See the NOTICE file distributed with
+ * this work for additional information regarding copyright
+ * ownership. Elasticsearch B.V. licenses this file to you under
+ * the Apache License, Version 2.0 (the "License"); you may
+ * not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *   http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing,
+ * software distributed under the License is distributed on an
+ * "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+ * KIND, either express or implied.  See the License for the
+ * specific language governing permissions and limitations
+ * under the License.
+ */
+package co.elastic.apm.agent.sdk.bytebuddy.clazzes;
+
+/**
+ * Scala objects generate a class with a dollar at the end
+ * https://www.toptal.com/scala/scala-bytecode-and-the-jvm
+ */
+public class ScalaObject$ {
+
+}
diff --git a/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/SimpleClass.java b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/SimpleClass.java
new file mode 100644
index 0000000000..e0153bffa8
--- /dev/null
+++ b/apm-agent-plugin-sdk/src/test/java/co/elastic/apm/agent/sdk/bytebuddy/clazzes/SimpleClass.java
@@ -0,0 +1,23 @@
+/*
+ * Licensed to Elasticsearch B.V. under one or more contributor
+ * license agreements. See the NOTICE file distributed with
+ * this work for additional information regarding copyright
+ * ownership. Elasticsearch B.V. licenses this file to you under
+ * the Apache License, Version 2.0 (the "License"); you may
+ * not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *   http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing,
+ * software distributed under the License is distributed on an
+ * "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+ * KIND, either express or implied.  See the License for the
+ * specific language governing permissions and limitations
+ * under the License.
+ */
+package co.elastic.apm.agent.sdk.bytebuddy.clazzes;
+
+public class SimpleClass {
+
+}
diff --git a/apm-agent-plugins/apm-scheduled-annotation-plugin/src/test/java/co/elastic/apm/agent/scheduled/TimerTaskInstrumentationTest.java b/apm-agent-plugins/apm-scheduled-annotation-plugin/src/test/java/co/elastic/apm/agent/scheduled/TimerTaskInstrumentationTest.java
index 49c8a4e1a0..d5a8a1163c 100644
--- a/apm-agent-plugins/apm-scheduled-annotation-plugin/src/test/java/co/elastic/apm/agent/scheduled/TimerTaskInstrumentationTest.java
+++ b/apm-agent-plugins/apm-scheduled-annotation-plugin/src/test/java/co/elastic/apm/agent/scheduled/TimerTaskInstrumentationTest.java
@@ -80,7 +80,7 @@ public void run() {
             }, 1);
 
         reporter.awaitTransactionCount(1);
-        assertThat(reporter.getTransactions().get(0).getNameAsString()).isEqualTo("1#run");
+        assertThat(reporter.getTransactions().get(0).getNameAsString()).isEqualTo("TimerTaskInstrumentationTest$1#run");
     }
 
     public static class TestTimerTask extends TimerTask {