diff --git a/hydra/_internal/instantiate/_instantiate2.py b/hydra/_internal/instantiate/_instantiate2.py
index fe7da9f5c8..f8b8647fd7 100644
--- a/hydra/_internal/instantiate/_instantiate2.py
+++ b/hydra/_internal/instantiate/_instantiate2.py
@@ -137,6 +137,8 @@ def _resolve_target(
             if full_key:
                 msg += f"\nfull_key: {full_key}"
             raise InstantiationException(msg) from e
+    elif _is_target(target):  # Recursive target resolve
+        target = instantiate_node(target)
     if not callable(target):
         msg = f"Expected a callable target, got '{target}' of type '{type(target).__name__}'"
         if full_key:
diff --git a/tests/instantiate/__init__.py b/tests/instantiate/__init__.py
index e4afaec733..d11a3f664f 100644
--- a/tests/instantiate/__init__.py
+++ b/tests/instantiate/__init__.py
@@ -85,6 +85,21 @@ def method() -> str:
             return "OuterClass.Nested.method return"
 
 
+class ChainClass:
+    def __init__(self, a) -> None:
+        self.a = a
+
+    def set_b(self, b) -> "ChainClass":
+        self.b = b
+        return self
+
+    def __eq__(self, other: Any) -> bool:
+        if isinstance(other, ChainClass):
+            return self.a == other.a and self.b == other.b
+        else:
+            return False
+
+
 def add_values(a: int, b: int) -> int:
     return a + b
 
diff --git a/tests/instantiate/test_instantiate.py b/tests/instantiate/test_instantiate.py
index f311271fba..924da7ac37 100644
--- a/tests/instantiate/test_instantiate.py
+++ b/tests/instantiate/test_instantiate.py
@@ -26,6 +26,7 @@
     BClass,
     CenterCrop,
     CenterCropConf,
+    ChainClass,
     Compose,
     ComposeConf,
     IllegalType,
@@ -254,6 +255,22 @@ def config(request: Any, src: Any) -> Any:
             43,
             id="static_method",
         ),
+        # Check recursive
+        param(
+            {
+                "_target_":{
+                    "_target_": "builtins.getattr",
+                    "_args_":[{
+                        "_target_": "tests.instantiate.ChainClass",
+                        "a": 1
+                    }, "set_b"],
+                },
+                'b':2
+            },
+            {},
+            ChainClass(1).set_b(2),
+            id="recursive_target",
+        ),
         # Check nested types and static methods
         param(
             {"_target_": "tests.instantiate.NestingClass"},