diff --git a/gas/ChangeLog b/gas/ChangeLog
index 5c05b2cd414..0ed43121316 100644
--- a/gas/ChangeLog
+++ b/gas/ChangeLog
@@ -1,3 +1,8 @@
+2012-08-03  Maciej W. Rozycki  <macro@codesourcery.com>
+
+	* frags.c (frag_grow): Never shrink the obstack size requested
+	below the default.
+
 2012-08-02  Sean Keys  <skeys@ipdatasys.com>
 
 	* config/tc-m68hc11.c (s_m68hc11_parse_pseudo_instruction):
diff --git a/gas/frags.c b/gas/frags.c
index c6ac4259aab..beb251bb011 100644
--- a/gas/frags.c
+++ b/gas/frags.c
@@ -101,9 +101,11 @@ frag_grow (unsigned int nchars)
       if (newc < 0)
         as_fatal (_("can't extend frag %u chars"), nchars);
 
-      /* Force to allocate at least NEWC bytes.  */
+      /* Force to allocate at least NEWC bytes, but not less than the
+         default.  */
       oldc = obstack_chunk_size (&frchain_now->frch_obstack);
-      obstack_chunk_size (&frchain_now->frch_obstack) = newc;
+      if (newc > oldc)
+	obstack_chunk_size (&frchain_now->frch_obstack) = newc;
 
       while (obstack_room (&frchain_now->frch_obstack) < nchars)
         {