diff --git a/packages/vite/src/node/ssr/__tests__/ssrTransform.spec.ts b/packages/vite/src/node/ssr/__tests__/ssrTransform.spec.ts
index a5ca20c9be3d09..33d5071a054a99 100644
--- a/packages/vite/src/node/ssr/__tests__/ssrTransform.spec.ts
+++ b/packages/vite/src/node/ssr/__tests__/ssrTransform.spec.ts
@@ -787,3 +787,27 @@ export class Test {
     Object.defineProperty(__vite_ssr_exports__, \\"Test\\", { enumerable: true, configurable: true, get(){ return Test }});;"
   `)
 })
+
+// #10386
+test('track var scope by function', async () => {
+  expect(
+    await ssrTransformSimpleCode(`
+import { foo, bar } from 'foobar'
+function test() {
+  if (true) {
+    var foo = () => { var why = 'would' }, bar = 'someone'
+  }
+  return [foo, bar]
+}`)
+  ).toMatchInlineSnapshot(`
+    "
+    const __vite_ssr_import_0__ = await __vite_ssr_import__(\\"foobar\\");
+
+    function test() {
+      if (true) {
+        var foo = () => { var why = 'would' }, bar = 'someone'
+      }
+      return [foo, bar]
+    }"
+  `)
+})
diff --git a/packages/vite/src/node/ssr/ssrTransform.ts b/packages/vite/src/node/ssr/ssrTransform.ts
index fe24dddac2e79a..be25b367970472 100644
--- a/packages/vite/src/node/ssr/ssrTransform.ts
+++ b/packages/vite/src/node/ssr/ssrTransform.ts
@@ -5,6 +5,7 @@ import type {
   Identifier,
   Pattern,
   Property,
+  VariableDeclaration,
   Node as _Node
 } from 'estree'
 import { extract_names as extractNames } from 'periscopic'
@@ -319,6 +320,7 @@ function walk(
   { onIdentifier, onImportMeta, onDynamicImport }: Visitors
 ) {
   const parentStack: Node[] = []
+  const varKindStack: VariableDeclaration['kind'][] = []
   const scopeMap = new WeakMap<_Node, Set<string>>()
   const identifiers: [id: any, stack: Node[]][] = []
 
@@ -378,6 +380,11 @@ function walk(
         parentStack.unshift(parent)
       }
 
+      // track variable declaration kind stack used by VariableDeclarator
+      if (node.type === 'VariableDeclaration') {
+        varKindStack.unshift(node.kind)
+      }
+
       if (node.type === 'MetaProperty' && node.meta.name === 'import') {
         onImportMeta(node)
       } else if (node.type === 'ImportExpression') {
@@ -437,7 +444,10 @@ function walk(
         // mark property in destructuring pattern
         setIsNodeInPattern(node)
       } else if (node.type === 'VariableDeclarator') {
-        const parentFunction = findParentScope(parentStack)
+        const parentFunction = findParentScope(
+          parentStack,
+          varKindStack[0] === 'var'
+        )
         if (parentFunction) {
           handlePattern(node.id, parentFunction)
         }
@@ -452,6 +462,10 @@ function walk(
       ) {
         parentStack.shift()
       }
+
+      if (node.type === 'VariableDeclaration') {
+        varKindStack.shift()
+      }
     }
   })
 
@@ -541,8 +555,12 @@ function isFunction(node: _Node): node is FunctionNode {
 
 const scopeNodeTypeRE =
   /(?:Function|Class)(?:Expression|Declaration)$|Method$|^IfStatement$/
-function findParentScope(parentStack: _Node[]): _Node | undefined {
-  return parentStack.find((i) => scopeNodeTypeRE.test(i.type))
+function findParentScope(
+  parentStack: _Node[],
+  isVar = false
+): _Node | undefined {
+  const regex = isVar ? functionNodeTypeRE : scopeNodeTypeRE
+  return parentStack.find((i) => regex.test(i.type))
 }
 
 function isInDestructuringAssignment(