Index: src/lang/english.txt
===================================================================
--- src/lang/english.txt	(revision 19316)
+++ src/lang/english.txt	(working copy)
@@ -1249,6 +1249,7 @@
 STR_CONFIG_SETTING_ALLOW_SHARES                                 :{LTBLUE}Allow buying shares from other companies: {ORANGE}{STRING1}
 STR_CONFIG_SETTING_FEEDER_PAYMENT_SHARE                         :{LTBLUE}Percentage of leg profit to pay in feeder systems: {ORANGE}{STRING1}%
 STR_CONFIG_SETTING_DRAG_SIGNALS_DENSITY                         :{LTBLUE}When dragging, place signals every: {ORANGE}{STRING1} tile(s)
+STR_CONFIG_SETTING_DRAG_SIGNALS_FIXED_DISTANCE                  :{LTBLUE}When dragging, keep fixed distance between signals
 STR_CONFIG_SETTING_SEMAPHORE_BUILD_BEFORE_DATE                  :{LTBLUE}Automatically build semaphores before: {ORANGE}{STRING1}
 STR_CONFIG_SETTING_ENABLE_SIGNAL_GUI                            :{LTBLUE}Enable the signal GUI: {ORANGE}{STRING1}
 STR_CONFIG_SETTING_DEFAULT_SIGNAL_TYPE                          :{LTBLUE}Signal type to build by default: {ORANGE}{STRING1}
Index: src/rail_cmd.cpp
===================================================================
--- src/rail_cmd.cpp	(revision 19316)
+++ src/rail_cmd.cpp	(working copy)
@@ -1169,6 +1169,9 @@
 
 	/* signal_ctr         - amount of tiles already processed
 	 * signals_density    - setting to put signal on every Nth tile (double space on |, -- tracks)
+	 * last_plain_tile    - index of last plain rail tile (IsPlainRaiTile)
+	 * last_plain_ctr     - signal_ctr value for last plain rail tile
+	 * last_used_ctr      - signal_ctr value for last built/removed signal
 	 **********
 	 * trackdir   - trackdir to build with autorail
 	 * semaphores - semaphores or signals
@@ -1176,9 +1179,16 @@
 	 *              and convert all others to semaphore/signal
 	 * remove     - 1 remove signals, 0 build signals */
 	int signal_ctr = 0;
+	TileIndex last_plain_tile = INVALID_TILE;
+	int last_plain_ctr;
+	int last_used_ctr = INT_MIN; // initially INT_MIN to force building/removing at the first tile
 	for (;;) {
 		/* only build/remove signals with the specified density */
-		if ((remove && autofill) || signal_ctr % signal_density == 0) {
+		if (
+			(remove && autofill) ||
+			(signal_ctr >= (last_used_ctr + signal_density)) ||
+			(_settings_client.gui.drag_signals_fixed_distance && (signal_ctr % signal_density == 0))
+		) {
 			uint32 p1 = GB(TrackdirToTrack(trackdir), 0, 3);
 			SB(p1, 3, 1, mode);
 			SB(p1, 4, 1, semaphores);
@@ -1196,6 +1206,17 @@
 			if (ret.Succeeded()) {
 				err = false;
 				total_cost.AddCost(ret);
+				last_used_ctr = signal_ctr;
+			} else {
+				/* If signal can't be placed, place it before obstacle */
+				if ((last_plain_tile != INVALID_TILE) && (last_plain_tile != tile) && (last_plain_ctr != last_used_ctr)) {
+					ret = DoCommand(last_plain_tile, p1, signals, flags, remove ? CMD_REMOVE_SIGNALS : CMD_BUILD_SIGNALS);
+					if (ret.Succeeded()) {
+						err = false;
+						total_cost.AddCost(ret);
+						last_used_ctr = last_plain_ctr;
+					}
+				}
 			}
 		}
 
@@ -1217,6 +1238,12 @@
 				ToggleBit(trackdir, 0);
 			}
 		}
+
+		/* remember last tile where we can place a signal */
+		if (IsPlainRailTile(tile)) {
+			last_plain_tile = tile;
+			last_plain_ctr = signal_ctr;
+		}
 	}
 
 	return err ? CMD_ERROR : total_cost;
Index: src/settings_gui.cpp
===================================================================
--- src/settings_gui.cpp	(revision 19316)
+++ src/settings_gui.cpp	(working copy)
@@ -1309,6 +1309,7 @@
 	SettingEntry("construction.signal_side"),
 	SettingEntry("gui.enable_signal_gui"),
 	SettingEntry("gui.drag_signals_density"),
+	SettingEntry("gui.drag_signals_fixed_distance"),
 	SettingEntry("gui.semaphore_build_before"),
 	SettingEntry("gui.default_signal_type"),
 	SettingEntry("gui.cycle_signal_types"),
Index: src/settings_type.h
===================================================================
--- src/settings_type.h	(revision 19316)
+++ src/settings_type.h	(working copy)
@@ -87,6 +87,7 @@
 	bool   bridge_pillars;                   ///< show bridge pillars for high bridges
 	bool   auto_euro;                        ///< automatically switch to euro in 2002
 	byte   drag_signals_density;             ///< many signals density
+	bool   drag_signals_fixed_distance;      ///< keep fixed distance between signals when dragging
 	Year   semaphore_build_before;           ///< build semaphore signals automatically before this year
 	byte   news_message_timeout;             ///< how much longer than the news message "age" should we keep the message in the history
 	bool   show_track_reservation;           ///< highlight reserved tracks.
Index: src/table/settings.h
===================================================================
--- src/table/settings.h	(revision 19316)
+++ src/table/settings.h	(working copy)
@@ -570,6 +570,7 @@
 	  SDTC_VAR(gui.default_rail_type,         SLE_UINT8, S, MS,     0,        0,        2, 0, STR_CONFIG_SETTING_DEFAULT_RAIL_TYPE,           NULL),
 	 SDTC_BOOL(gui.enable_signal_gui,                    S,  0,  true,                        STR_CONFIG_SETTING_ENABLE_SIGNAL_GUI,           CloseSignalGUI),
 	  SDTC_VAR(gui.drag_signals_density,      SLE_UINT8, S,  0,     4,        1,       20, 0, STR_CONFIG_SETTING_DRAG_SIGNALS_DENSITY,        DragSignalsDensityChanged),
+	 SDTC_BOOL(gui.drag_signals_fixed_distance,          S,  0, false,                        STR_CONFIG_SETTING_DRAG_SIGNALS_FIXED_DISTANCE, NULL),
 	  SDTC_VAR(gui.semaphore_build_before,    SLE_INT32, S, NC,  1950, MIN_YEAR, MAX_YEAR, 1, STR_CONFIG_SETTING_SEMAPHORE_BUILD_BEFORE_DATE, ResetSignalVariant),
 	 SDTC_BOOL(gui.vehicle_income_warn,                  S,  0,  true,                        STR_CONFIG_SETTING_WARN_INCOME_LESS,            NULL),
 	  SDTC_VAR(gui.order_review_system,       SLE_UINT8, S, MS,     2,        0,        2, 0, STR_CONFIG_SETTING_ORDER_REVIEW,                NULL),