diff --git a/include/osgParticle/ParticleSystem b/include/osgParticle/ParticleSystem
index c8b9f0837..1012e4867 100644
--- a/include/osgParticle/ParticleSystem
+++ b/include/osgParticle/ParticleSystem
@@ -75,6 +75,19 @@ namespace osgParticle
         /// Set the alignment vectors.
         inline void setAlignVectors(const osg::Vec3& X, const osg::Vec3& Y);
 
+
+
+        enum ParticleScaleReferenceFrame
+        {
+            LOCAL_COORDINATES,
+            WORLD_COORDINATES
+        };
+
+        void setParticleScaleReferenceFrame(ParticleScaleReferenceFrame rf) { _particleScaleReferenceFrame = rf; }
+        ParticleScaleReferenceFrame getParticleScaleReferenceFrame() const { return _particleScaleReferenceFrame; }
+
+
+
         /// Get the default bounding box
         inline const osg::BoundingBox& getDefaultBoundingBox() const;        
         
@@ -188,7 +201,8 @@ namespace osgParticle
         Alignment _alignment;
         osg::Vec3 _align_X_axis;
         osg::Vec3 _align_Y_axis;
-
+        ParticleScaleReferenceFrame _particleScaleReferenceFrame;
+        
         bool _doublepass;
         bool _frozen;
 
diff --git a/src/osgParticle/ParticleEffect.cpp b/src/osgParticle/ParticleEffect.cpp
index 93255d2ea..40d6f66f0 100644
--- a/src/osgParticle/ParticleEffect.cpp
+++ b/src/osgParticle/ParticleEffect.cpp
@@ -165,6 +165,8 @@ void ParticleEffect::buildEffect()
 
     if (_useLocalParticleSystem)
     {
+        particleSystem->setParticleScaleReferenceFrame(ParticleSystem::LOCAL_COORDINATES);
+    
         // add the geode to the scene graph
         osg::Geode* geode = new osg::Geode;
         geode->addDrawable(particleSystem.get());
diff --git a/src/osgParticle/ParticleSystem.cpp b/src/osgParticle/ParticleSystem.cpp
index d22a144e0..ad45a2190 100644
--- a/src/osgParticle/ParticleSystem.cpp
+++ b/src/osgParticle/ParticleSystem.cpp
@@ -22,6 +22,7 @@ osgParticle::ParticleSystem::ParticleSystem()
     _alignment(BILLBOARD),
     _align_X_axis(1, 0, 0),
     _align_Y_axis(0, 1, 0),
+    _particleScaleReferenceFrame(WORLD_COORDINATES),
     _doublepass(false),
     _frozen(false),
     _bmin(0, 0, 0), 
@@ -45,6 +46,7 @@ osgParticle::ParticleSystem::ParticleSystem(const ParticleSystem& copy, const os
     _alignment(copy._alignment),
     _align_X_axis(copy._align_X_axis),
     _align_Y_axis(copy._align_Y_axis),
+    _particleScaleReferenceFrame(copy._particleScaleReferenceFrame),
     _doublepass(copy._doublepass),
     _frozen(copy._frozen),
     _bmin(copy._bmin), 
@@ -102,9 +104,6 @@ void osgParticle::ParticleSystem::drawImplementation(osg::RenderInfo& renderInfo
     // get the current modelview matrix
     osg::Matrix modelview = state.getModelViewMatrix();
 
-    if (_alignment == BILLBOARD)
-        state.applyModelViewMatrix(0);
-
     // set up depth mask for first rendering pass
     glPushAttrib(GL_DEPTH_BUFFER_BIT); 
     glDepthMask(GL_FALSE);
@@ -174,10 +173,32 @@ void osgParticle::ParticleSystem::single_pass_render(osg::State&  /*state*/, con
     if (_particles.size() <= 0) return;
 
     float scale = sqrtf(static_cast<float>(_detail));
-
+    
     const Particle* startParticle = &_particles[0];
     startParticle->beginRender();
 
+    osg::Vec3 xAxis = _align_X_axis;
+    osg::Vec3 yAxis = _align_Y_axis;
+    
+    if (_alignment==BILLBOARD)
+    {
+        xAxis = osg::Matrix::transform3x3(modelview,xAxis);
+        yAxis = osg::Matrix::transform3x3(modelview,yAxis);
+        float scaleX = xAxis.length();
+        float scaleY = yAxis.length();
+
+        if (_particleScaleReferenceFrame==LOCAL_COORDINATES)
+        {
+            xAxis /= scaleX;
+            yAxis /= scaleY;
+        }
+        else
+        {
+            xAxis /= (scaleX*scaleX);
+            yAxis /= (scaleX*scaleY);
+        }
+    }
+
     for(unsigned int i=0; i<_particles.size(); i+=_detail)
     {
         const Particle* currentParticle = &_particles[i];
@@ -190,16 +211,8 @@ void osgParticle::ParticleSystem::single_pass_render(osg::State&  /*state*/, con
                 startParticle = currentParticle;
             }
             ++_draw_count;
-
-            switch (_alignment) {
-                case BILLBOARD:
-                    currentParticle->render(modelview.preMult(currentParticle->getPosition()), osg::Vec3(1, 0, 0), osg::Vec3(0, 1, 0), scale);
-                    break;
-                case FIXED:
-                    currentParticle->render(currentParticle->getPosition(), _align_X_axis, _align_Y_axis, scale);
-                    break;
-                default:;
-            }            
+            
+            currentParticle->render(currentParticle->getPosition(), xAxis, yAxis, scale);
         } 
     }
 
diff --git a/src/osgPlugins/osgParticle/IO_ParticleSystem.cpp b/src/osgPlugins/osgParticle/IO_ParticleSystem.cpp
index 2a6d63851..869176fcc 100644
--- a/src/osgPlugins/osgParticle/IO_ParticleSystem.cpp
+++ b/src/osgPlugins/osgParticle/IO_ParticleSystem.cpp
@@ -43,6 +43,19 @@ bool ParticleSystem_readLocalData(osg::Object &obj, osgDB::Input &fr)
         }
     }
 
+    if (fr[0].matchWord("particleScaleReferenceFrame")) {
+        if (fr[1].matchWord("LOCAL_COORDINATES")) {
+            myobj.setParticleScaleReferenceFrame(osgParticle::ParticleSystem::LOCAL_COORDINATES);
+            fr += 2;
+            itAdvanced = true;
+        }
+        if (fr[1].matchWord("")) {
+            myobj.setParticleScaleReferenceFrame(osgParticle::ParticleSystem::WORLD_COORDINATES);
+            fr += 2;
+            itAdvanced = true;
+        }
+    }
+
     if (fr[0].matchWord("alignVectorX")) {
         osg::Vec3 v;
         if (fr[1].getFloat(v.x()) && fr[2].getFloat(v.y()) && fr[3].getFloat(v.z())) {
@@ -138,6 +151,17 @@ bool ParticleSystem_writeLocalData(const osg::Object &obj, osgDB::Output &fw)
             break;
     }
 
+    fw.indent() << "particleScaleReferenceFrame ";
+    switch (myobj.getParticleScaleReferenceFrame()) {
+        default:
+        case osgParticle::ParticleSystem::LOCAL_COORDINATES:
+            fw << "LOCAL_COORDINATES" << std::endl;
+            break;
+        case osgParticle::ParticleSystem::WORLD_COORDINATES:
+            fw << "WORLD_COORDINATES" << std::endl;
+            break;
+    }
+
     osg::Vec3 v = myobj.getAlignVectorX();
     fw.indent() << "alignVectorX " << v.x() << " " << v.y() << " " << v.z() << std::endl;
     v = myobj.getAlignVectorY();