diff --git a/src/Microsoft.OpenApi.Readers/OpenApiYamlDocumentReader.cs b/src/Microsoft.OpenApi.Readers/OpenApiYamlDocumentReader.cs
index e43c64ac2..f6fd2325e 100644
--- a/src/Microsoft.OpenApi.Readers/OpenApiYamlDocumentReader.cs
+++ b/src/Microsoft.OpenApi.Readers/OpenApiYamlDocumentReader.cs
@@ -166,7 +166,6 @@ private void ResolveReferences(OpenApiDiagnostic diagnostic, OpenApiDocument doc
             }
         }
 
-
         /// <summary>
         /// Reads the stream input and parses the fragment of an OpenAPI description into an Open API Element.
         /// </summary>
diff --git a/src/Microsoft.OpenApi.Readers/V3/OpenApiSecuritySchemeDeserializer.cs b/src/Microsoft.OpenApi.Readers/V3/OpenApiSecuritySchemeDeserializer.cs
index 0e7b1c39c..dd6ad4751 100644
--- a/src/Microsoft.OpenApi.Readers/V3/OpenApiSecuritySchemeDeserializer.cs
+++ b/src/Microsoft.OpenApi.Readers/V3/OpenApiSecuritySchemeDeserializer.cs
@@ -76,7 +76,11 @@ internal static partial class OpenApiV3Deserializer
         public static OpenApiSecurityScheme LoadSecurityScheme(ParseNode node)
         {
             var mapNode = node.CheckMapNode("securityScheme");
-
+            var pointer = mapNode.GetReferencePointer();
+            if (pointer != null)
+            {
+                return mapNode.GetReferencedObject<OpenApiSecurityScheme>(ReferenceType.SecurityScheme, pointer);
+            }
             var securityScheme = new OpenApiSecurityScheme();
             foreach (var property in mapNode)
             {
diff --git a/src/Microsoft.OpenApi/Services/OpenApiWalker.cs b/src/Microsoft.OpenApi/Services/OpenApiWalker.cs
index 8c469261c..3d9e978c9 100644
--- a/src/Microsoft.OpenApi/Services/OpenApiWalker.cs
+++ b/src/Microsoft.OpenApi/Services/OpenApiWalker.cs
@@ -1,4 +1,4 @@
-// Copyright (c) Microsoft Corporation. All rights reserved.
+// Copyright (c) Microsoft Corporation. All rights reserved.
 // Licensed under the MIT license. 
 
 using System;
@@ -116,7 +116,18 @@ internal void Walk(OpenApiComponents components)
                     }
                 }
             });
-
+            
+            Walk(OpenApiConstants.SecuritySchemes, () =>
+            {
+                if (components.SecuritySchemes != null)
+                {
+                    foreach (var item in components.SecuritySchemes)
+                    {
+                        Walk(item.Key, () => Walk(item.Value, isComponent: true));
+                    }
+                }
+            });
+            
             Walk(OpenApiConstants.Callbacks, () =>
             {
                 if (components.Callbacks != null)
@@ -996,9 +1007,9 @@ internal void Walk(OpenApiSecurityRequirement securityRequirement)
         /// <summary>
         /// Visits <see cref="OpenApiSecurityScheme"/> and child objects
         /// </summary>
-        internal void Walk(OpenApiSecurityScheme securityScheme)
+        internal void Walk(OpenApiSecurityScheme securityScheme, bool isComponent = false)
         {
-            if (securityScheme == null || ProcessAsReference(securityScheme))
+            if (securityScheme == null || ProcessAsReference(securityScheme, isComponent))
             {
                 return;
             }
diff --git a/test/Microsoft.OpenApi.Readers.Tests/Microsoft.OpenApi.Readers.Tests.csproj b/test/Microsoft.OpenApi.Readers.Tests/Microsoft.OpenApi.Readers.Tests.csproj
index 65833564f..aef3d92e0 100644
--- a/test/Microsoft.OpenApi.Readers.Tests/Microsoft.OpenApi.Readers.Tests.csproj
+++ b/test/Microsoft.OpenApi.Readers.Tests/Microsoft.OpenApi.Readers.Tests.csproj
@@ -137,6 +137,9 @@
       <EmbeddedResource Include="V3Tests\Samples\OpenApiDocument\minimalDocument.yaml">
         <CopyToOutputDirectory>Never</CopyToOutputDirectory>
       </EmbeddedResource>
+      <EmbeddedResource Include="V3Tests\Samples\OpenApiDocument\docWithSecuritySchemeReference.yaml">
+        <CopyToOutputDirectory>Never</CopyToOutputDirectory>
+      </EmbeddedResource>
       <EmbeddedResource Include="V3Tests\Samples\OpenApiDocument\apiWithFullHeaderComponent.yaml">
         <CopyToOutputDirectory>Never</CopyToOutputDirectory>
       </EmbeddedResource>
diff --git a/test/Microsoft.OpenApi.Readers.Tests/V3Tests/OpenApiDocumentTests.cs b/test/Microsoft.OpenApi.Readers.Tests/V3Tests/OpenApiDocumentTests.cs
index 362609291..8a0da3481 100644
--- a/test/Microsoft.OpenApi.Readers.Tests/V3Tests/OpenApiDocumentTests.cs
+++ b/test/Microsoft.OpenApi.Readers.Tests/V3Tests/OpenApiDocumentTests.cs
@@ -3,6 +3,7 @@
 
 using System;
 using System.Collections.Generic;
+using System.Diagnostics.Contracts;
 using System.Globalization;
 using System.IO;
 using System.Linq;
@@ -1334,10 +1335,10 @@ public void DoesNotChangeExternalReferences()
         {
             // Arrange
             using var stream = Resources.GetStream(Path.Combine(SampleFolderPath, "documentWithExternalRefs.yaml"));
-            
+
             // Act
             var doc = new OpenApiStreamReader(
-                new OpenApiReaderSettings { ReferenceResolution = ReferenceResolutionSetting.DoNotResolveReferences})
+                new OpenApiReaderSettings { ReferenceResolution = ReferenceResolutionSetting.DoNotResolveReferences })
                 .Read(stream, out var diagnostic);
 
             var externalRef = doc.Components.Schemas["Nested"].Properties["AnyOf"].AnyOf.First().Reference.ReferenceV3;
@@ -1347,5 +1348,24 @@ public void DoesNotChangeExternalReferences()
             Assert.Equal("file:///C:/MySchemas.json#/definitions/ArrayObject", externalRef);
             Assert.Equal("../foo/schemas.yaml#/components/schemas/Number", externalRef2);
         }
+
+        [Fact]
+        public void ParseDocumentWithReferencedSecuritySchemeWorks()
+        {
+            // Arrange
+            using var stream = Resources.GetStream(Path.Combine(SampleFolderPath, "docWithSecuritySchemeReference.yaml"));
+
+            // Act
+            var doc = new OpenApiStreamReader(new OpenApiReaderSettings
+            {
+                ReferenceResolution = ReferenceResolutionSetting.ResolveLocalReferences
+            }).Read(stream, out var diagnostic);
+
+            var securityScheme = doc.Components.SecuritySchemes["OAuth2"];
+
+            // Assert
+            Assert.False(securityScheme.UnresolvedReference);
+            Assert.NotNull(securityScheme.Flows);
+        }
     }
 }
diff --git a/test/Microsoft.OpenApi.Readers.Tests/V3Tests/Samples/OpenApiDocument/docWithSecuritySchemeReference.yaml b/test/Microsoft.OpenApi.Readers.Tests/V3Tests/Samples/OpenApiDocument/docWithSecuritySchemeReference.yaml
new file mode 100644
index 000000000..3608635a2
--- /dev/null
+++ b/test/Microsoft.OpenApi.Readers.Tests/V3Tests/Samples/OpenApiDocument/docWithSecuritySchemeReference.yaml
@@ -0,0 +1,17 @@
+openapi: 3.0.0
+info:
+  title: Example API
+  version: 1.0.0
+paths: { }
+components:
+  securitySchemes:
+    OAuth2:
+      $ref: '#/components/securitySchemes/RefOAuth2'
+    RefOAuth2:
+      type: oauth2
+      flows:
+        implicit:
+          authorizationUrl: https://example.com/api/oauth/dialog
+          scopes:
+            write:pets: modify pets in your account
+            read:pets: read your pets
\ No newline at end of file