diff -uNrp src/encoder/encoder.c src.new/encoder/encoder.c
--- src/encoder/encoder.c	2012-07-19 16:42:32 +0300
+++ src.new/encoder/encoder.c	2012-07-19 16:43:11 +0300
@@ -800,7 +800,7 @@ static int x264_validate_parameters( x26
         h->param.analyse.intra &= ~X264_ANALYSE_I8x8;
     }
     h->param.analyse.i_trellis = x264_clip3( h->param.analyse.i_trellis, 0, 2 );
-    h->param.rc.i_aq_mode = x264_clip3( h->param.rc.i_aq_mode, 0, 2 );
+    h->param.rc.i_aq_mode = x264_clip3( h->param.rc.i_aq_mode, 0, 3 );
     h->param.rc.f_aq_strength = x264_clip3f( h->param.rc.f_aq_strength, 0, 3 );
     if( h->param.rc.f_aq_strength == 0 )
         h->param.rc.i_aq_mode = 0;
diff -uNrp src/encoder/ratecontrol.c src.new/encoder/ratecontrol.c
--- src/encoder/ratecontrol.c	2012-07-19 11:29:04 +0300
+++ src.new/encoder/ratecontrol.c	2012-07-19 16:44:40 +0300
@@ -301,10 +301,6 @@ static NOINLINE uint32_t x264_ac_energy_
 
 void x264_adaptive_quant_frame( x264_t *h, x264_frame_t *frame, float *quant_offsets )
 {
-    /* constants chosen to result in approximately the same overall bitrate as without AQ.
-     * FIXME: while they're written in 5 significant digits, they're only tuned to 2. */
-    float strength;
-    float avg_adj = 0.f;
     /* Initialize frame stats */
     for( int i = 0; i < 3; i++ )
     {
@@ -348,23 +344,30 @@ void x264_adaptive_quant_frame( x264_t *
     /* Actual adaptive quantization */
     else
     {
-        if( h->param.rc.i_aq_mode == X264_AQ_AUTOVARIANCE )
+        /* constants chosen to result in approximately the same overall bitrate as without AQ.
+         * FIXME: while they're written in 5 significant digits, they're only tuned to 2. */
+        float strength;
+        float avg_adj = 0.f;
+        float mod_strength = 0.f;
+
+        if( h->param.rc.i_aq_mode == X264_AQ_AUTOVARIANCE || h->param.rc.i_aq_mode == X264_AQ_AUTOVARIANCE_MOD )
         {
-            float bit_depth_correction = powf(1 << (BIT_DEPTH-8), 0.5f);
+            float bit_depth_correction = 1.f / (1 << (2*(BIT_DEPTH-8)));
             float avg_adj_pow2 = 0.f;
             for( int mb_y = 0; mb_y < h->mb.i_mb_height; mb_y++ )
                 for( int mb_x = 0; mb_x < h->mb.i_mb_width; mb_x++ )
                 {
                     uint32_t energy = x264_ac_energy_mb( h, mb_x, mb_y, frame );
-                    float qp_adj = powf( energy + 1, 0.125f );
+                    float qp_adj = powf( energy * bit_depth_correction + 1, 0.125f );
                     frame->f_qp_offset[mb_x + mb_y*h->mb.i_mb_stride] = qp_adj;
                     avg_adj += qp_adj;
                     avg_adj_pow2 += qp_adj * qp_adj;
                 }
             avg_adj /= h->mb.i_mb_count;
             avg_adj_pow2 /= h->mb.i_mb_count;
-            strength = h->param.rc.f_aq_strength * avg_adj / bit_depth_correction;
-            avg_adj = avg_adj - 0.5f * (avg_adj_pow2 - (14.f * bit_depth_correction)) / avg_adj;
+            strength = h->param.rc.f_aq_strength * avg_adj;
+            avg_adj = avg_adj - 0.5f * (avg_adj_pow2 - 14.f) / avg_adj;
+            mod_strength = h->param.rc.f_aq_strength;
         }
         else
             strength = h->param.rc.f_aq_strength * 1.0397f;
@@ -374,7 +377,12 @@ void x264_adaptive_quant_frame( x264_t *
             {
                 float qp_adj;
                 int mb_xy = mb_x + mb_y*h->mb.i_mb_stride;
-                if( h->param.rc.i_aq_mode == X264_AQ_AUTOVARIANCE )
+                if( h->param.rc.i_aq_mode == X264_AQ_AUTOVARIANCE_MOD )
+                {
+                    qp_adj = frame->f_qp_offset[mb_xy];
+                    qp_adj = strength * (qp_adj - avg_adj) + mod_strength * (1.f - 14.f / (qp_adj * qp_adj));
+                }
+                else if( h->param.rc.i_aq_mode == X264_AQ_AUTOVARIANCE )
                 {
                     qp_adj = frame->f_qp_offset[mb_xy];
                     qp_adj = strength * (qp_adj - avg_adj);
diff -uNrp src/x264.c src.new/x264.c
--- src/x264.c	2012-07-19 16:42:32 +0300
+++ src.new/x264.c	2012-07-19 16:44:55 +0300
@@ -702,7 +702,8 @@ static void help( x264_param_t *defaults
     H2( "      --aq-mode <integer>     AQ method [%d]\n"
         "                                  - 0: Disabled\n"
         "                                  - 1: Variance AQ (complexity mask)\n"
-        "                                  - 2: Auto-variance AQ (experimental)\n", defaults->rc.i_aq_mode );
+        "                                  - 2: Auto-variance AQ (experimental)\n"
+        "                                  - 3: Auto-variance AQ modification\n", defaults->rc.i_aq_mode );
     H1( "      --aq-strength <float>   Reduces blocking and blurring in flat and\n"
         "                              textured areas. [%.1f]\n", defaults->rc.f_aq_strength );
     H1( "      --fade-compensate <float> Allocate more bits to fades [%.1f]\n", defaults->rc.f_fade_compensate );
diff -uNrp src/x264.h src.new/x264.h
--- src/x264.h	2012-07-19 16:42:33 +0300
+++ src.new/x264.h	2012-07-19 16:45:07 +0300
@@ -170,6 +170,7 @@ typedef struct
 #define X264_AQ_NONE                 0
 #define X264_AQ_VARIANCE             1
 #define X264_AQ_AUTOVARIANCE         2
+#define X264_AQ_AUTOVARIANCE_MOD     3
 #define X264_B_ADAPT_NONE            0
 #define X264_B_ADAPT_FAST            1
 #define X264_B_ADAPT_TRELLIS         2