diff --git a/impl/src/fmt/display.rs b/impl/src/fmt/display.rs
index 0610a145..738c2e1e 100644
--- a/impl/src/fmt/display.rs
+++ b/impl/src/fmt/display.rs
@@ -32,7 +32,17 @@ pub fn expand(input: &syn::DeriveInput, trait_name: &str) -> syn::Result<TokenSt
     let trait_ident = format_ident!("{trait_name}");
     let ident = &input.ident;
 
-    let ctx = (&attrs, ident, &trait_ident, &attr_name);
+    let type_params: Vec<_> = input
+        .generics
+        .params
+        .iter()
+        .filter_map(|p| match p {
+            syn::GenericParam::Type(t) => Some(&t.ident),
+            syn::GenericParam::Const(..) | syn::GenericParam::Lifetime(..) => None,
+        })
+        .collect();
+
+    let ctx: ExpansionCtx = (&attrs, &type_params, ident, &trait_ident, &attr_name);
     let (bounds, body) = match &input.data {
         syn::Data::Struct(s) => expand_struct(s, ctx),
         syn::Data::Enum(e) => expand_enum(e, ctx),
@@ -62,6 +72,7 @@ pub fn expand(input: &syn::DeriveInput, trait_name: &str) -> syn::Result<TokenSt
 
 /// Type alias for an expansion context:
 /// - [`ContainerAttributes`].
+/// - Type parameters. Slice of [`syn::Ident`].
 /// - Struct/enum/union [`syn::Ident`].
 /// - Derived trait [`syn::Ident`].
 /// - Attribute name [`syn::Ident`].
@@ -69,6 +80,7 @@ pub fn expand(input: &syn::DeriveInput, trait_name: &str) -> syn::Result<TokenSt
 /// [`syn::Ident`]: struct@syn::Ident
 type ExpansionCtx<'a> = (
     &'a ContainerAttributes,
+    &'a [&'a syn::Ident],
     &'a syn::Ident,
     &'a syn::Ident,
     &'a syn::Ident,
@@ -77,12 +89,13 @@ type ExpansionCtx<'a> = (
 /// Expands a [`fmt::Display`]-like derive macro for the provided struct.
 fn expand_struct(
     s: &syn::DataStruct,
-    (attrs, ident, trait_ident, _): ExpansionCtx<'_>,
+    (attrs, type_params, ident, trait_ident, _): ExpansionCtx<'_>,
 ) -> syn::Result<(Vec<syn::WherePredicate>, TokenStream)> {
     let s = Expansion {
         shared_attr: None,
         attrs,
         fields: &s.fields,
+        type_params,
         trait_ident,
         ident,
     };
@@ -111,7 +124,7 @@ fn expand_struct(
 /// Expands a [`fmt`]-like derive macro for the provided enum.
 fn expand_enum(
     e: &syn::DataEnum,
-    (container_attrs, _, trait_ident, attr_name): ExpansionCtx<'_>,
+    (container_attrs, type_params, _, trait_ident, attr_name): ExpansionCtx<'_>,
 ) -> syn::Result<(Vec<syn::WherePredicate>, TokenStream)> {
     if let Some(shared_fmt) = &container_attrs.fmt {
         if shared_fmt
@@ -153,6 +166,7 @@ fn expand_enum(
                 shared_attr: container_attrs.fmt.as_ref(),
                 attrs: &attrs,
                 fields: &variant.fields,
+                type_params,
                 trait_ident,
                 ident,
             };
@@ -190,7 +204,7 @@ fn expand_enum(
 /// Expands a [`fmt::Display`]-like derive macro for the provided union.
 fn expand_union(
     u: &syn::DataUnion,
-    (attrs, _, _, attr_name): ExpansionCtx<'_>,
+    (attrs, _, _, _, attr_name): ExpansionCtx<'_>,
 ) -> syn::Result<(Vec<syn::WherePredicate>, TokenStream)> {
     let fmt = &attrs.fmt.as_ref().ok_or_else(|| {
         syn::Error::new(
@@ -227,6 +241,9 @@ struct Expansion<'a> {
     /// Struct or enum [`syn::Fields`].
     fields: &'a syn::Fields,
 
+    /// Type parameters in this struct or enum.
+    type_params: &'a [&'a syn::Ident],
+
     /// [`fmt`] trait [`syn::Ident`].
     ///
     /// [`syn::Ident`]: struct@syn::Ident
@@ -343,11 +360,14 @@ impl<'a> Expansion<'a> {
             if let Some(fmt) = &self.attrs.fmt {
                 bounds.extend(
                     fmt.bounded_types(self.fields)
-                        .map(|(ty, trait_name)| {
-                            let trait_ident = format_ident!("{trait_name}");
+                    .filter_map(|(ty, trait_name)| {
+                        if !self.contains_generic_param(ty) {
+                            return None;
+                        }
+                        let trait_ident = format_ident!("{trait_name}");
 
-                            parse_quote! { #ty: derive_more::core::fmt::#trait_ident }
-                        })
+                        Some(parse_quote! { #ty: derive_more::core::fmt::#trait_ident })
+                    })
                         .chain(self.attrs.bounds.0.clone()),
                 );
             } else {
@@ -360,17 +380,121 @@ impl<'a> Expansion<'a> {
         }
 
         if let Some(shared_fmt) = &self.shared_attr {
-            bounds.extend(shared_fmt.bounded_types(self.fields).map(
+            bounds.extend(shared_fmt.bounded_types(self.fields).filter_map(
                 |(ty, trait_name)| {
+                    if !self.contains_generic_param(ty) {
+                        return None;
+                    }
                     let trait_ident = format_ident!("{trait_name}");
 
-                    parse_quote! { #ty: derive_more::core::fmt::#trait_ident }
+                    Some(parse_quote! { #ty: derive_more::core::fmt::#trait_ident })
                 },
             ));
         }
 
         bounds
     }
+
+    /// Checks whether the provided [`syn::Path`] contains any of these [`Expansion::type_params`].
+    fn path_contains_generic_param(&self, path: &syn::Path) -> bool {
+        path.segments
+            .iter()
+            .any(|segment| match &segment.arguments {
+                syn::PathArguments::None => false,
+                syn::PathArguments::AngleBracketed(
+                    syn::AngleBracketedGenericArguments { args, .. },
+                ) => args.iter().any(|generic| match generic {
+                    syn::GenericArgument::Type(ty)
+                    | syn::GenericArgument::AssocType(syn::AssocType { ty, .. }) => {
+                        self.contains_generic_param(ty)
+                    }
+
+                    syn::GenericArgument::Lifetime(_)
+                    | syn::GenericArgument::Const(_)
+                    | syn::GenericArgument::AssocConst(_)
+                    | syn::GenericArgument::Constraint(_) => false,
+                    _ => unimplemented!(
+                        "syntax is not supported by `derive_more`, please report a bug",
+                    ),
+                }),
+                syn::PathArguments::Parenthesized(
+                    syn::ParenthesizedGenericArguments { inputs, output, .. },
+                ) => {
+                    inputs.iter().any(|ty| self.contains_generic_param(ty))
+                        || match output {
+                            syn::ReturnType::Default => false,
+                            syn::ReturnType::Type(_, ty) => {
+                                self.contains_generic_param(ty)
+                            }
+                        }
+                }
+            })
+    }
+
+    /// Checks whether the provided [`syn::Type`] contains any of these [`Expansion::type_params`].
+    fn contains_generic_param(&self, ty: &syn::Type) -> bool {
+        if self.type_params.is_empty() {
+            return false;
+        }
+        match ty {
+            syn::Type::Path(syn::TypePath { qself, path }) => {
+                if let Some(qself) = qself {
+                    if self.contains_generic_param(&qself.ty) {
+                        return true;
+                    }
+                }
+
+                if let Some(ident) = path.get_ident() {
+                    self.type_params.iter().any(|param| *param == ident)
+                } else {
+                    self.path_contains_generic_param(path)
+                }
+            }
+
+            syn::Type::Array(syn::TypeArray { elem, .. })
+            | syn::Type::Group(syn::TypeGroup { elem, .. })
+            | syn::Type::Paren(syn::TypeParen { elem, .. })
+            | syn::Type::Ptr(syn::TypePtr { elem, .. })
+            | syn::Type::Reference(syn::TypeReference { elem, .. })
+            | syn::Type::Slice(syn::TypeSlice { elem, .. }) => {
+                self.contains_generic_param(elem)
+            }
+
+            syn::Type::BareFn(syn::TypeBareFn { inputs, output, .. }) => {
+                inputs
+                    .iter()
+                    .any(|arg| self.contains_generic_param(&arg.ty))
+                    || match output {
+                        syn::ReturnType::Default => false,
+                        syn::ReturnType::Type(_, ty) => self.contains_generic_param(ty),
+                    }
+            }
+            syn::Type::Tuple(syn::TypeTuple { elems, .. }) => {
+                elems.iter().any(|ty| self.contains_generic_param(ty))
+            }
+
+            syn::Type::ImplTrait(_) => false,
+            syn::Type::Infer(_) => false,
+            syn::Type::Macro(_) => false,
+            syn::Type::Never(_) => false,
+            syn::Type::TraitObject(syn::TypeTraitObject { bounds, .. }) => {
+                bounds.iter().any(|bound| match bound {
+                    syn::TypeParamBound::Trait(syn::TraitBound { path, .. }) => {
+                        self.path_contains_generic_param(path)
+                    }
+                    syn::TypeParamBound::Lifetime(_) => false,
+                    syn::TypeParamBound::Verbatim(_) => false,
+                    _ => unimplemented!(
+                        "syntax is not supported by `derive_more`, please report a bug",
+                    ),
+                })
+            }
+            syn::Type::Verbatim(_) => false,
+            _ => unimplemented!(
+                "syntax is not supported by `derive_more`, please report a bug",
+            ),
+        }
+    }
 }
 
 /// Matches the provided derive macro `name` to appropriate actual trait name.
diff --git a/tests/display.rs b/tests/display.rs
index bd0f45ae..493206e5 100644
--- a/tests/display.rs
+++ b/tests/display.rs
@@ -2279,3 +2279,184 @@ mod generic {
         }
     }
 }
+
+// See: https://github.com/JelteF/derive_more/issues/363
+mod type_variables {
+    mod our_alloc {
+        #[cfg(not(feature = "std"))]
+        pub use alloc::{boxed::Box, format, vec::Vec};
+        #[cfg(feature = "std")]
+        pub use std::{boxed::Box, format, vec::Vec};
+    }
+
+    use our_alloc::{format, Box};
+
+    // We want Vec in scope to test that code generation works if it is
+    #[allow(unused_imports)]
+    use our_alloc::Vec;
+
+    use derive_more::Display;
+
+    #[derive(Display, Debug)]
+    #[display("{inner:?}")]
+    #[display(bounds(T: Display))]
+    struct OptionalBox<T> {
+        inner: Option<Box<T>>,
+    }
+
+    #[derive(Display, Debug)]
+    #[display("{next}")]
+    struct ItemStruct {
+        next: OptionalBox<ItemStruct>,
+    }
+
+    #[derive(Display)]
+    #[derive(Debug)]
+    struct ItemTuple(OptionalBox<ItemTuple>);
+
+    #[derive(Display)]
+    #[derive(Debug)]
+    #[display("Item({_0})")]
+    struct ItemTupleContainerFmt(OptionalBox<ItemTupleContainerFmt>);
+
+    #[derive(Display, Debug)]
+    #[display("{next}")]
+    enum ItemEnumOuterFormat {
+        Variant1 {
+            next: OptionalBox<ItemEnumOuterFormat>,
+        },
+        Variant2 {
+            next: OptionalBox<i32>,
+        },
+    }
+
+    #[derive(Display, Debug)]
+    enum ItemEnumInnerFormat {
+        #[display("{next} {inner}")]
+        Node {
+            next: OptionalBox<ItemEnumInnerFormat>,
+            inner: i32,
+        },
+        #[display("{inner}")]
+        Leaf { inner: i32 },
+    }
+
+    #[derive(Display)]
+    #[derive(Debug)]
+    #[display("{next:?}, {real:?}")]
+    struct VecMeansDifferent<Vec> {
+        next: our_alloc::Vec<i32>,
+        real: Vec,
+    }
+
+    #[derive(Display)]
+    #[derive(Debug)]
+    #[display("{t:?}")]
+    struct Array<T> {
+        t: [T; 10],
+    }
+
+    mod parens {
+        #![allow(unused_parens)] // test that type is found even in parentheses
+
+        use derive_more::Display;
+
+        #[derive(Display)]
+        struct Paren<T> {
+            t: (T),
+        }
+    }
+
+    #[derive(Display)]
+    struct ParenthesizedGenericArgumentsInput<T> {
+        t: dyn Fn(T) -> i32,
+    }
+
+    #[derive(Display)]
+    struct ParenthesizedGenericArgumentsOutput<T> {
+        t: dyn Fn(i32) -> T,
+    }
+
+    #[derive(Display)]
+    struct Ptr<T> {
+        t: *const T,
+    }
+
+    #[derive(Display)]
+    struct Reference<'a, T> {
+        t: &'a T,
+    }
+
+    #[derive(Display)]
+    struct Slice<'a, T> {
+        t: &'a [T],
+    }
+
+    #[derive(Display)]
+    struct BareFn<T> {
+        t: Box<fn(T) -> T>,
+    }
+
+    #[derive(Display)]
+    struct Tuple<T> {
+        t: Box<(T, T)>,
+    }
+
+    trait MyTrait<T> {}
+
+    #[derive(Display)]
+    struct TraitObject<T> {
+        t: Box<dyn MyTrait<T>>,
+    }
+
+    #[test]
+    fn assert() {
+        assert_eq!(
+            format!(
+                "{}",
+                ItemStruct {
+                    next: OptionalBox {
+                        inner: Some(Box::new(ItemStruct {
+                            next: OptionalBox { inner: None }
+                        }))
+                    }
+                },
+            ),
+            "Some(ItemStruct { next: OptionalBox { inner: None } })",
+        );
+
+        assert_eq!(
+            format!(
+                "{}",
+                ItemTuple(OptionalBox {
+                    inner: Some(Box::new(ItemTuple(OptionalBox { inner: None })))
+                }),
+            ),
+            "Some(ItemTuple(OptionalBox { inner: None }))",
+        );
+
+        assert_eq!(
+            format!(
+                "{}",
+                ItemTupleContainerFmt(OptionalBox {
+                    inner: Some(Box::new(ItemTupleContainerFmt(OptionalBox {
+                        inner: None
+                    })))
+                }),
+            ),
+            "Item(Some(ItemTupleContainerFmt(OptionalBox { inner: None })))",
+        );
+
+        let item = ItemEnumOuterFormat::Variant1 {
+            next: OptionalBox {
+                inner: Some(Box::new(ItemEnumOuterFormat::Variant2 {
+                    next: OptionalBox { inner: None },
+                })),
+            },
+        };
+        assert_eq!(
+            format!("{item}"),
+            "Some(Variant2 { next: OptionalBox { inner: None } })",
+        )
+    }
+}