diff --git a/mypy/checkexpr.py b/mypy/checkexpr.py
index 58e01a89802c..872248af1d57 100644
--- a/mypy/checkexpr.py
+++ b/mypy/checkexpr.py
@@ -1360,29 +1360,58 @@ def visit_tuple_expr(self, e: TupleExpr) -> Type:
         return TupleType(items, self.chk.named_generic_type('builtins.tuple', [fallback_item]))
 
     def visit_dict_expr(self, e: DictExpr) -> Type:
-        # Translate into type checking a generic function call.
+        """Type check a dict expression.
+
+        Translate it into a call to dict(), with provisions for **expr.
+        """
+        # Collect function arguments, watching out for **expr.
+        args = []  # type: List[Node]  # Regular "key: value"
+        stargs = []  # type: List[Node]  # For "**expr"
+        for key, value in e.items:
+            if key is None:
+                stargs.append(value)
+            else:
+                args.append(TupleExpr([key, value]))
+        # Define type variables (used in constructors below).
         ktdef = TypeVarDef('KT', -1, [], self.chk.object_type())
         vtdef = TypeVarDef('VT', -2, [], self.chk.object_type())
         kt = TypeVarType(ktdef)
         vt = TypeVarType(vtdef)
-        # The callable type represents a function like this:
-        #
-        #   def <unnamed>(*v: Tuple[kt, vt]) -> Dict[kt, vt]: ...
-        constructor = CallableType(
-            [TupleType([kt, vt], self.named_type('builtins.tuple'))],
-            [nodes.ARG_STAR],
-            [None],
-            self.chk.named_generic_type('builtins.dict', [kt, vt]),
-            self.named_type('builtins.function'),
-            name='<list>',
-            variables=[ktdef, vtdef])
-        # Synthesize function arguments.
-        args = []  # type: List[Node]
-        for key, value in e.items:
-            args.append(TupleExpr([key, value]))
-        return self.check_call(constructor,
-                               args,
-                               [nodes.ARG_POS] * len(args), e)[0]
+        # Call dict(*args), unless it's empty and stargs is not.
+        if args or not stargs:
+            # The callable type represents a function like this:
+            #
+            #   def <unnamed>(*v: Tuple[kt, vt]) -> Dict[kt, vt]: ...
+            constructor = CallableType(
+                [TupleType([kt, vt], self.named_type('builtins.tuple'))],
+                [nodes.ARG_STAR],
+                [None],
+                self.chk.named_generic_type('builtins.dict', [kt, vt]),
+                self.named_type('builtins.function'),
+                name='<list>',
+                variables=[ktdef, vtdef])
+            rv = self.check_call(constructor, args, [nodes.ARG_POS] * len(args), e)[0]
+        else:
+            # dict(...) will be called below.
+            rv = None
+        # Call rv.update(arg) for each arg in **stargs,
+        # except if rv isn't set yet, then set rv = dict(arg).
+        if stargs:
+            for arg in stargs:
+                if rv is None:
+                    constructor = CallableType(
+                        [self.chk.named_generic_type('typing.Mapping', [kt, vt])],
+                        [nodes.ARG_POS],
+                        [None],
+                        self.chk.named_generic_type('builtins.dict', [kt, vt]),
+                        self.named_type('builtins.function'),
+                        name='<list>',
+                        variables=[ktdef, vtdef])
+                    rv = self.check_call(constructor, [arg], [nodes.ARG_POS], arg)[0]
+                else:
+                    method = self.analyze_external_member_access('update', rv, arg)
+                    self.check_call(method, [arg], [nodes.ARG_POS], arg)
+        return rv
 
     def visit_func_expr(self, e: FuncExpr) -> Type:
         """Type check lambda expression."""
diff --git a/mypy/nodes.py b/mypy/nodes.py
index 86942b03b28e..21308e8d798a 100644
--- a/mypy/nodes.py
+++ b/mypy/nodes.py
@@ -1457,7 +1457,9 @@ class DictExpr(Expression):
 
     def __init__(self, items: List[Tuple[Expression, Expression]]) -> None:
         self.items = items
-        if all(x[0].literal == LITERAL_YES and x[1].literal == LITERAL_YES
+        # key is None for **item, e.g. {'a': 1, **x} has
+        # keys ['a', None] and values [1, x].
+        if all(x[0] and x[0].literal == LITERAL_YES and x[1].literal == LITERAL_YES
                for x in items):
             self.literal = LITERAL_YES
             self.literal_hash = ('Dict',) + tuple(
diff --git a/mypy/semanal.py b/mypy/semanal.py
index 230a5b5c6898..841d34739e5f 100644
--- a/mypy/semanal.py
+++ b/mypy/semanal.py
@@ -1937,7 +1937,8 @@ def visit_set_expr(self, expr: SetExpr) -> None:
 
     def visit_dict_expr(self, expr: DictExpr) -> None:
         for key, value in expr.items:
-            key.accept(self)
+            if key is not None:
+                key.accept(self)
             value.accept(self)
 
     def visit_star_expr(self, expr: StarExpr) -> None:
diff --git a/mypy/traverser.py b/mypy/traverser.py
index ddd4ea7aaa42..d77b003b91e1 100644
--- a/mypy/traverser.py
+++ b/mypy/traverser.py
@@ -180,7 +180,8 @@ def visit_tuple_expr(self, o: TupleExpr) -> None:
 
     def visit_dict_expr(self, o: DictExpr) -> None:
         for k, v in o.items:
-            k.accept(self)
+            if k is not None:
+                k.accept(self)
             v.accept(self)
 
     def visit_set_expr(self, o: SetExpr) -> None:
diff --git a/test-data/unit/check-expressions.test b/test-data/unit/check-expressions.test
index 8fbcaefd4ba9..63529f4e0bac 100644
--- a/test-data/unit/check-expressions.test
+++ b/test-data/unit/check-expressions.test
@@ -1503,3 +1503,19 @@ None == None
 [case testLtNone]
 None < None  # E: Unsupported left operand type for < (None)
 [builtins fixtures/ops.py]
+
+[case testDictWithStarExpr]
+# options: fast_parser
+b = {'z': 26, *a}  # E: invalid syntax
+[builtins fixtures/dict.py]
+
+[case testDictWithStarStarExpr]
+# options: fast_parser
+from typing import Dict
+a = {'a': 1}
+b = {'z': 26, **a}
+c = {**b}
+d = {**a, **b, 'c': 3}
+e = {1: 'a', **a}  # E: Argument 1 to "update" of "dict" has incompatible type Dict[str, int]; expected Mapping[int, str]
+f = {**b}  # type: Dict[int, int]  # E: List item 0 has incompatible type Dict[str, int]
+[builtins fixtures/dict.py]
diff --git a/test-data/unit/fixtures/dict.py b/test-data/unit/fixtures/dict.py
index 86ad7f5c8dd0..709def8c86c9 100644
--- a/test-data/unit/fixtures/dict.py
+++ b/test-data/unit/fixtures/dict.py
@@ -1,6 +1,6 @@
 # Builtins stub used in dictionary-related test cases.
 
-from typing import TypeVar, Generic, Iterable, Iterator, Tuple, overload
+from typing import TypeVar, Generic, Iterable, Iterator, Mapping, Tuple, overload
 
 T = TypeVar('T')
 KT = TypeVar('KT')
@@ -11,14 +11,14 @@ def __init__(self) -> None: pass
 
 class type: pass
 
-class dict(Iterable[KT], Generic[KT, VT]):
+class dict(Iterable[KT], Mapping[KT, VT], Generic[KT, VT]):
     @overload
     def __init__(self, **kwargs: VT) -> None: pass
     @overload
     def __init__(self, arg: Iterable[Tuple[KT, VT]], **kwargs: VT) -> None: pass
     def __setitem__(self, k: KT, v: VT) -> None: pass
     def __iter__(self) -> Iterator[KT]: pass
-    def update(self, a: 'dict[KT, VT]') -> None: pass
+    def update(self, a: Mapping[KT, VT]) -> None: pass
 
 class int: pass # for convenience
 
diff --git a/test-data/unit/lib-stub/typing.py b/test-data/unit/lib-stub/typing.py
index 09f927c41c27..3ba9a4398c8a 100644
--- a/test-data/unit/lib-stub/typing.py
+++ b/test-data/unit/lib-stub/typing.py
@@ -74,6 +74,8 @@ class Sequence(Iterable[T], Generic[T]):
     @abstractmethod
     def __getitem__(self, n: Any) -> T: pass
 
+class Mapping(Generic[T, U]): pass
+
 def NewType(name: str, tp: Type[T]) -> Callable[[T], T]:
     def new_type(x):
         return x