"The project: swing which is referenced by the classpath, does not exist" in Eclipse when project name is the same as workspace name

I am new to swing development using eclipse but I have been using eclipse for my java code development for more than a year. Today when I wrote a sample swing class got a curious error from eclipse.

I created a workspace swing , and created a new project in the same name as the workspace. Then wrote a sample class inside the project, please find the code below.

import javax.swing.JFrame;
import javax.swing.JLabel;
import javax.swing.SwingUtilities;


public class SwingDemo {

    public SwingDemo() {
        // TODO Auto-generated constructor stub
        JFrame jFrame = new JFrame("A sample swing application");
        jFrame.setSize(275, 100);

        jFrame.setDefaultCloseOperation(JFrame.EXIT_ON_CLOSE);

        JLabel jLabel = new JLabel("Welcome to swing!!!!");
        jFrame.add(jLabel);

        jFrame.setVisible(true);
    }

    /**
     * @param args
     */
    public static void main(String[] args) {
        // TODO Auto-generated method stub
        SwingUtilities.invokeLater(new Runnable() {

            @Override
            public void run() {
                // TODO Auto-generated method stub
                new SwingDemo();
            }
        });

    }

}

When I tried to execute it in eclipse ,resulted in the below error

The project: swing which is referenced by the classpath, does not exist.

The same code was executed fine, when the project name and workspace name were differrent.

I am just curious, what caused this error. Please help