diff --git a/CHANGES b/CHANGES
index 4fef0eb1e1..a67d1d1427 100644
--- a/CHANGES
+++ b/CHANGES
@@ -24,6 +24,7 @@
 	#1735: [PATCH] mplayer: convert to autotools infrastructure
 	#2371: QT MYSQL Module does not build when MySQL installed on the host
 	#2905: Qt: Speed up compilation, if gui-module isn't selected
+	#2929: genext2fs: couldn't allocate a block (no free space)
 	#2965: Broken linkage to xkbcomp (blocking X server startup)
 	#2983: xlib_libX11 build failed
 
diff --git a/fs/ext2/genext2fs.sh b/fs/ext2/genext2fs.sh
index b315ec30ac..7a518aea74 100755
--- a/fs/ext2/genext2fs.sh
+++ b/fs/ext2/genext2fs.sh
@@ -10,24 +10,11 @@ while getopts x:d:D:b:i:N:m:g:e:zfqUPhVv f
 do
     case $f in
 	b) CALC_BLOCKS=0 ;;
-	N) CALC_INODES=0 ;;
+	N) CALC_INODES=0; INODES=$OPTARG ;;
 	d) TARGET_DIR=$OPTARG ;;
     esac
 done
 
-# calculate needed blocks
-if [ $CALC_BLOCKS -eq 1 ];
-then
-    BLOCKS=$(du -s -c -k $TARGET_DIR | grep total | sed -e "s/total//")
-    if [ $BLOCKS -ge 20000 ];
-    then
-	BLOCKS=$(expr $BLOCKS + 16384)
-    else
-	BLOCKS=$(expr $BLOCKS + 2400)
-    fi
-    set -- $@ -b $BLOCKS
-fi
-
 # calculate needed inodes
 if [ $CALC_INODES -eq 1 ];
 then
@@ -36,4 +23,14 @@ then
     set -- $@ -N $INODES
 fi
 
+# calculate needed blocks
+if [ $CALC_BLOCKS -eq 1 ];
+then
+    # size ~= superblock, block+inode bitmaps, inodes (8 per block), blocks
+    # we scale inodes / blocks with 10% to compensate for bitmaps size + slack
+    BLOCKS=$(du -s -c -k $TARGET_DIR | grep total | sed -e "s/total//")
+    BLOCKS=$(expr 500 + \( $BLOCKS + $INODES / 8 \) \* 11 / 10)
+    set -- $@ -b $BLOCKS
+fi
+
 exec genext2fs $@