diff --git a/lib/crypto/signature.js b/lib/crypto/signature.js
index deaa660..5b0c2a0 100644
--- a/lib/crypto/signature.js
+++ b/lib/crypto/signature.js
@@ -31,10 +31,17 @@ Signature.prototype.set = function(obj) {
 };
 
 Signature.fromCompact = function(buf) {
+  $.checkArgument(BufferUtil.isBuffer(buf), 'Argument is expected to be a Buffer');
+
   var sig = new Signature();
-  //TODO: handle uncompressed pubkeys
+
   var compressed = true;
   var i = buf.slice(0, 1)[0] - 27 - 4;
+  if (i < 0) {
+    compressed = false;
+    i = i + 4;
+  }
+
   var b2 = buf.slice(1, 33);
   var b3 = buf.slice(33, 65);
 
@@ -142,8 +149,9 @@ Signature.prototype.toCompact = function(i, compressed) {
   }
 
   var val = i + 27 + 4;
-  if (compressed === false)
+  if (compressed === false) {
     val = val - 4;
+  }
   var b1 = new Buffer([val]);
   var b2 = this.r.toBuffer({
     size: 32
diff --git a/test/crypto/signature.js b/test/crypto/signature.js
index 809d9b9..74e3ba7 100644
--- a/test/crypto/signature.js
+++ b/test/crypto/signature.js
@@ -49,6 +49,18 @@ describe('Signature', function() {
       var sig = Signature.fromCompact(compressed);
       sig.r.cmp(BN.Zero).should.equal(0);
       sig.s.cmp(BN.Zero).should.equal(0);
+      sig.compressed.should.equal(true);
+    });
+
+    it('should create a signature from an uncompressed signature', function() {
+      var sigHexaStr = '1cd5e61ab5bfd0d1450997894cb1a53e917f89d82eb43f06fa96f32c96e061aec12fc1188e8b' +
+        '0dc553a2588be2b5b68dbbd7f092894aa3397786e9c769c5348dc6';
+      var sig = Signature.fromCompact(new Buffer(sigHexaStr, 'hex'));
+      var r = 'd5e61ab5bfd0d1450997894cb1a53e917f89d82eb43f06fa96f32c96e061aec1';
+      var s = '2fc1188e8b0dc553a2588be2b5b68dbbd7f092894aa3397786e9c769c5348dc6';
+      sig.r.toString('hex').should.equal(r);
+      sig.s.toString('hex').should.equal(s);
+      sig.compressed.should.equal(false);
     });
 
   });