Index: app/tools/gimptransformtool.c
===================================================================
--- app/tools/gimptransformtool.c	(revision 28237)
+++ app/tools/gimptransformtool.c	(working copy)
@@ -801,7 +801,7 @@
         {
           gint gci, i, k;
 
-          k = tr_tool->ngx + tr_tool->ngy;
+          k = tr_tool->ngx + 2 + tr_tool->ngy + 2;
 
           for (i = 0, gci = 0; i < k; i++, gci += 4)
             {
@@ -1324,9 +1324,15 @@
                                 tr_tool->x2, tr_tool->y2,
                                 &tr_tool->tx4, &tr_tool->ty4);
 
+  fprintf(stderr, "\nBefore: (%f, %f) -> (%f, %f)\n", tr_tool->cx, tr_tool->cy,
+          tr_tool->tcx, tr_tool->tcy);
+  
   gimp_matrix3_transform_point (&tr_tool->transform,
                                 tr_tool->cx, tr_tool->cy,
                                 &tr_tool->tcx, &tr_tool->tcy);
+  
+  fprintf(stderr, " After: (%f, %f) -> (%f, %f)\n\n", tr_tool->cx, tr_tool->cy,
+          tr_tool->tcx, tr_tool->tcy);
 
   if (tr_tool->grid_coords && tr_tool->tgrid_coords)
     {
@@ -1334,7 +1340,7 @@
       gint gci;
 
       gci = 0;
-      k   = (tr_tool->ngx + tr_tool->ngy) * 2;
+      k   = (tr_tool->ngx + 2 + tr_tool->ngy + 2) * 2;
 
       for (i = 0; i < k; i++)
         {
@@ -1343,6 +1349,11 @@
                                         tr_tool->grid_coords[gci + 1],
                                         &tr_tool->tgrid_coords[gci],
                                         &tr_tool->tgrid_coords[gci + 1]);
+/*          fprintf(stderr, "Step %d/%d transformed (%f, %f) to (%f, %f)\n", i, k,
+                  tr_tool->grid_coords[gci],
+                  tr_tool->grid_coords[gci + 1],
+                  tr_tool->tgrid_coords[gci],
+                  tr_tool->tgrid_coords[gci + 1]);*/
           gci += 2;
         }
     }
@@ -1559,7 +1570,9 @@
         GimpTool *tool;
         gint      i, gci;
         gdouble  *coords;
+        gdouble   h_stride, v_stride;
         gint      width, height;
+        gdouble   x_off, y_off;
 
         width  = MAX (1, tr_tool->x2 - tr_tool->x1);
         height = MAX (1, tr_tool->y2 - tr_tool->y1);
@@ -1572,46 +1585,67 @@
               {
                 tr_tool->ngx = options->grid_size;
                 tr_tool->ngy = tr_tool->ngx * MAX (1, height / width);
+
+                h_stride = width  / (options->grid_size + 1);
+                v_stride = height / (options->grid_size + 1);
               }
             else
               {
                 tr_tool->ngy = options->grid_size;
                 tr_tool->ngx = tr_tool->ngy * MAX (1, width / height);
+
+                v_stride = height / (options->grid_size + 1);
+                h_stride = width  / (options->grid_size + 1);
               }
           }
         else /* GIMP_TRANSFORM_GRID_TYPE_SPACING */
           {
             gint grid_size = MAX (2, options->grid_size);
+            
+            h_stride = v_stride = grid_size;
 
             tr_tool->ngx = width  / grid_size;
             tr_tool->ngy = height / grid_size;
           }
 
+        x_off = fmod(tr_tool->tcx, h_stride);
+        y_off = fmod(tr_tool->tcy, v_stride);
+        
+        fprintf(stderr, "\n");
+        fprintf(stderr, "tcx = %f\ttcy = %f\n", tr_tool->tcx, tr_tool->tcy);
+        fprintf(stderr, "cx = %f\tcy = %f\th_stride = %f\tv_stride = %f\n",
+                tr_tool->cx, tr_tool->cy, h_stride, v_stride);
+        fprintf(stderr, "x_off = %f\ty_off = %f\n", x_off, y_off);
+
         tr_tool->grid_coords = coords =
-          g_new (gdouble, (tr_tool->ngx + tr_tool->ngy) * 4);
+          g_new (gdouble, (tr_tool->ngx + 2 + tr_tool->ngy + 2) * 4);
 
         tr_tool->tgrid_coords =
-          g_new (gdouble, (tr_tool->ngx + tr_tool->ngy) * 4);
+          g_new (gdouble, (tr_tool->ngx + 2 + tr_tool->ngy + 2) * 4);
 
         gci = 0;
 
-        for (i = 1; i <= tr_tool->ngx; i++)
+        for (i = 0; i <= tr_tool->ngx + 1; i++)
           {
+            /*  endpoints for vertical gridlines  */
             coords[gci]     = tr_tool->x1 + (((gdouble) i) / (tr_tool->ngx + 1) *
-                                             (tr_tool->x2 - tr_tool->x1));
-            coords[gci + 1] = tr_tool->y1;
+                                             (tr_tool->x2 - tr_tool->x1))
+                                          + x_off;
+            coords[gci + 1] = tr_tool->y1 + y_off - v_stride;
             coords[gci + 2] = coords[gci];
-            coords[gci + 3] = tr_tool->y2;
+            coords[gci + 3] = tr_tool->y2 + y_off + v_stride;
 
             gci += 4;
           }
 
-        for (i = 1; i <= tr_tool->ngy; i++)
+        for (i = 0; i <= tr_tool->ngy + 1; i++)
           {
-            coords[gci]     = tr_tool->x1;
+            /*  endpoints for horizontal gridlines  */
+            coords[gci]     = tr_tool->x1 + x_off - h_stride;
             coords[gci + 1] = tr_tool->y1 + (((gdouble) i) / (tr_tool->ngy + 1) *
-                                             (tr_tool->y2 - tr_tool->y1));
-            coords[gci + 2] = tr_tool->x2;
+                                             (tr_tool->y2 - tr_tool->y1))
+                                          + y_off;
+            coords[gci + 2] = tr_tool->x2 + x_off + h_stride;
             coords[gci + 3] = coords[gci + 1];
 
             gci += 4;
@@ -1734,6 +1768,7 @@
   if (GIMP_TRANSFORM_TOOL_GET_CLASS (tr_tool)->recalc)
     GIMP_TRANSFORM_TOOL_GET_CLASS (tr_tool)->recalc (tr_tool, display);
 
+  gimp_transform_tool_grid_recalc (tr_tool);
   gimp_transform_tool_transform_bounding_box (tr_tool);
 
   gimp_transform_tool_dialog_update (tr_tool);