diff --git a/CHANGELOG.md b/CHANGELOG.md
index 9d3cca93636c..32ea237f62d6 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -20,6 +20,7 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 - Remove default `[hidden]` style in preflight ([#8248](https://github.com/tailwindlabs/tailwindcss/pull/8248))
 - Only check selectors containing base apply candidates for circular dependencies ([#8222](https://github.com/tailwindlabs/tailwindcss/pull/8222))
 - Rewrite default class extractor ([#8204](https://github.com/tailwindlabs/tailwindcss/pull/8204))
+- Move `important` selector to the front when `@apply`-ing selector-modifying variants in custom utilities ([#8313](https://github.com/tailwindlabs/tailwindcss/pull/8313))
 
 ### Changed
 
diff --git a/src/lib/expandApplyAtRules.js b/src/lib/expandApplyAtRules.js
index 1bef657fc6cf..f5e84a318147 100644
--- a/src/lib/expandApplyAtRules.js
+++ b/src/lib/expandApplyAtRules.js
@@ -471,7 +471,27 @@ function processApply(root, context, localCache) {
               return
             }
 
-            rule.selector = replaceSelector(parent.selector, rule.selector, applyCandidate)
+            // Strip the important selector from the parent selector if at the beginning
+            let importantSelector =
+              typeof context.tailwindConfig.important === 'string'
+                ? context.tailwindConfig.important
+                : null
+
+            // We only want to move the "important" selector if this is a Tailwind-generated utility
+            // We do *not* want to do this for user CSS that happens to be structured the same
+            let isGenerated = parent.raws.tailwind !== undefined
+
+            let parentSelector =
+              isGenerated && importantSelector && parent.selector.indexOf(importantSelector) === 0
+                ? parent.selector.slice(importantSelector.length)
+                : parent.selector
+
+            rule.selector = replaceSelector(parentSelector, rule.selector, applyCandidate)
+
+            // And then re-add it if it was removed
+            if (importantSelector && parentSelector !== parent.selector) {
+              rule.selector = `${importantSelector} ${rule.selector}`
+            }
 
             rule.walkDecls((d) => {
               d.important = meta.important || important
diff --git a/tests/apply.test.js b/tests/apply.test.js
index 7033300f01a6..6040aad22c38 100644
--- a/tests/apply.test.js
+++ b/tests/apply.test.js
@@ -1467,3 +1467,84 @@ it('should apply using the updated user CSS when the source has changed', async
     }
   `)
 })
+
+it('apply + layer utilities + selector variants (like group) + important selector', async () => {
+  let config = {
+    important: '#myselector',
+    content: [{ raw: html`<div class="custom-utility"></div>` }],
+    plugins: [],
+  }
+
+  let input = css`
+    @tailwind utilities;
+    @layer utilities {
+      .custom-utility {
+        @apply font-normal group-hover:underline;
+      }
+    }
+  `
+
+  let result = await run(input, config)
+
+  expect(result.css).toMatchFormattedCss(css`
+    #myselector .custom-utility {
+      font-weight: 400;
+    }
+
+    #myselector .group:hover .custom-utility {
+      text-decoration-line: underline;
+    }
+  `)
+})
+
+it('apply + user CSS + selector variants (like group) + important selector (1)', async () => {
+  let config = {
+    important: '#myselector',
+    content: [{ raw: html`<div class="custom-utility"></div>` }],
+    plugins: [],
+  }
+
+  let input = css`
+    .custom-utility {
+      @apply font-normal group-hover:underline;
+    }
+  `
+
+  let result = await run(input, config)
+
+  expect(result.css).toMatchFormattedCss(css`
+    .custom-utility {
+      font-weight: 400;
+    }
+
+    .group:hover .custom-utility {
+      text-decoration-line: underline;
+    }
+  `)
+})
+
+it('apply + user CSS + selector variants (like group) + important selector (2)', async () => {
+  let config = {
+    important: '#myselector',
+    content: [{ raw: html`<div class="custom-utility"></div>` }],
+    plugins: [],
+  }
+
+  let input = css`
+    #myselector .custom-utility {
+      @apply font-normal group-hover:underline;
+    }
+  `
+
+  let result = await run(input, config)
+
+  expect(result.css).toMatchFormattedCss(css`
+    #myselector .custom-utility {
+      font-weight: 400;
+    }
+
+    .group:hover #myselector .custom-utility {
+      text-decoration-line: underline;
+    }
+  `)
+})