Index: nodereference.module
===================================================================
--- nodereference.module	(revision 17321)
+++ nodereference.module	(working copy)
@@ -113,14 +113,16 @@
 function nodereference_field($op, &$node, $field, &$items, $teaser, $page) {
   switch ($op) {
     case 'validate':
-      $refs = _nodereference_potential_references($field, TRUE);
+
       foreach ($items as $delta => $item) {
         $error_field = isset($item['error_field']) ? $item['error_field'] : '';
         unset($item['error_field']);
-        if (!empty($item['nid'])) {
-          if (!in_array($item['nid'], array_keys($refs))) {
-            form_set_error($error_field, t('%name : This post can\'t be referenced.', array('%name' => t($field['widget']['label']))));
-          }
+        if (!empty($item['nid'])) {        
+          //if node doesn't exist
+          $referenced_node = node_load($item['nid']);
+          if (!$referenced_node) {
+            form_set_error($error_field, t('%name : This node can\'t be referenced.', array('%name' => t($field['widget']['label']))));
+          }        
         }
       }
       return;