diff --git a/babel/messages/extract.py b/babel/messages/extract.py
index f0584d460..c03b8cca0 100644
--- a/babel/messages/extract.py
+++ b/babel/messages/extract.py
@@ -835,10 +835,12 @@ def parse_template_string(
         if level:
             expression_contents += character
         if not inside_str:
-            if character == '{' and prev_character == '$':
+            # start of new template string or object definition
+            if character == '{':
                 level += 1
             elif level and character == '}':
                 level -= 1
+                # end of template string
                 if level == 0 and expression_contents:
                     expression_contents = expression_contents[0:-1]
                     fake_file_obj = io.BytesIO(expression_contents.encode())
diff --git a/tests/messages/test_js_extract.py b/tests/messages/test_js_extract.py
index fc643851e..f234a80e4 100644
--- a/tests/messages/test_js_extract.py
+++ b/tests/messages/test_js_extract.py
@@ -191,3 +191,13 @@ def test_inside_nested_template_string():
     )
 
     assert messages == [(1, 'Greetings!', [], None), (1, 'This is a lovely evening.', [], None), (1, 'The day is really nice!', [], None)]
+
+
+def test_template_string_with_parameters() -> None:
+    buf = BytesIO(
+        b'`${gettext("text %(param)s", { param: myVar })}`;',
+    )
+    messages = list(extract.extract("javascript", buf, {"gettext": None}, [], {"parse_template_string": True}))
+    assert messages == [
+        (1, "text %(param)s", [], None),
+    ]