diff --git a/src/services/refactors/extractSymbol.ts b/src/services/refactors/extractSymbol.ts
index 62ba653961f..b5167124512 100644
--- a/src/services/refactors/extractSymbol.ts
+++ b/src/services/refactors/extractSymbol.ts
@@ -275,7 +275,7 @@ namespace ts.refactor.extractSymbol {
         }
         const cursorRequest = length === 0 && invoked;
 
-        const startToken = getTokenAtPosition(sourceFile, span.start);
+        const startToken = findFirstNonJsxWhitespaceToken(sourceFile, span.start);
         const endToken = findTokenOnLeftOfPosition(sourceFile, textSpanEnd(span));
         /* If the refactoring command is invoked through a keyboard action it's safe to assume that the user is actively looking for
         refactoring actions at the span location. As they may not know the exact range that will trigger a refactoring, we expand the
diff --git a/src/services/utilities.ts b/src/services/utilities.ts
index 6b4330e3155..7516da5e8de 100644
--- a/src/services/utilities.ts
+++ b/src/services/utilities.ts
@@ -1141,6 +1141,20 @@ namespace ts {
         }
     }
 
+    /**
+     * Returns the first token where position is in [start, end),
+     * excluding `JsxText` tokens containing only whitespace.
+     */
+    export function findFirstNonJsxWhitespaceToken(sourceFile: SourceFile, position: number): Node | undefined {
+        let tokenAtPosition = getTokenAtPosition(sourceFile, position);
+        while (isWhiteSpaceOnlyJsxText(tokenAtPosition)) {
+            const nextToken = findNextToken(tokenAtPosition, tokenAtPosition.parent, sourceFile);
+            if (!nextToken) return;
+            tokenAtPosition = nextToken;
+        }
+        return tokenAtPosition;
+    }
+
     /**
      * The token on the left of the position is the token that strictly includes the position
      * or sits to the left of the cursor if it is on a boundary. For example
diff --git a/tests/cases/fourslash/extract-method_jsxPreceedingWhitespace.ts b/tests/cases/fourslash/extract-method_jsxPreceedingWhitespace.ts
new file mode 100644
index 00000000000..388a6eea7ab
--- /dev/null
+++ b/tests/cases/fourslash/extract-method_jsxPreceedingWhitespace.ts
@@ -0,0 +1,36 @@
+/// <reference path='fourslash.ts' />
+
+// Repro https://github.com/Microsoft/TypeScript/issues/42829
+
+// @jsx: preserve
+// @filename: a.tsx
+////export default function ComponentThatExhibitsIssue() {
+////    return <div>
+////  /*a*/    <div className="some-nested-data">
+////        hello from my nested component
+////      </div>
+////  
+////        /*b*/
+////    </div>
+
+goTo.file("a.tsx");
+goTo.select("a", "b");
+edit.applyRefactor({
+    refactorName: "Extract Symbol",
+    actionName: "function_scope_1",
+    actionDescription: "Extract to function in module scope",
+    newContent:
+`export default function ComponentThatExhibitsIssue() {
+    return <div>
+      {newFunction()}
+  
+        
+    </div>
+
+function /*RENAME*/newFunction() {
+        return <div className="some-nested-data">
+            hello from my nested component
+        </div>;
+    }
+`
+});