diff --git a/policy/src/com/android/internal/policy/impl/keyguard/SlidingChallengeLayout.java b/policy/src/com/android/internal/policy/impl/keyguard/SlidingChallengeLayout.java
index 61561439b8ddc..fd87646572bbb 100644
--- a/policy/src/com/android/internal/policy/impl/keyguard/SlidingChallengeLayout.java
+++ b/policy/src/com/android/internal/policy/impl/keyguard/SlidingChallengeLayout.java
@@ -16,6 +16,8 @@
 
 package com.android.internal.policy.impl.keyguard;
 
+import com.android.internal.R;
+
 import android.animation.Animator;
 import android.animation.AnimatorListenerAdapter;
 import android.animation.ObjectAnimator;
@@ -29,7 +31,6 @@ import android.graphics.drawable.Drawable;
 import android.util.AttributeSet;
 import android.util.FloatProperty;
 import android.util.Log;
-import android.util.MathUtils;
 import android.util.Property;
 import android.view.MotionEvent;
 import android.view.VelocityTracker;
@@ -40,8 +41,6 @@ import android.view.accessibility.AccessibilityManager;
 import android.view.animation.Interpolator;
 import android.widget.Scroller;
 
-import com.android.internal.R;
-
 /**
  * This layout handles interaction with the sliding security challenge views
  * that overlay/resize other keyguard contents.
@@ -53,7 +52,7 @@ public class SlidingChallengeLayout extends ViewGroup implements ChallengeLayout
     // The drag handle is measured in dp above & below the top edge of the
     // challenge view; these parameters change based on whether the challenge 
     // is open or closed.
-    private static final int DRAG_HANDLE_CLOSED_ABOVE = 64; // dp
+    private static final int DRAG_HANDLE_CLOSED_ABOVE = 8; // dp
     private static final int DRAG_HANDLE_CLOSED_BELOW = 0; // dp
     private static final int DRAG_HANDLE_OPEN_ABOVE = 8; // dp
     private static final int DRAG_HANDLE_OPEN_BELOW = 0; // dp
@@ -581,18 +580,16 @@ public class SlidingChallengeLayout extends ViewGroup implements ChallengeLayout
                     final float x = ev.getX(i);
                     final float y = ev.getY(i);
                     if (!mIsBouncing && mActivePointerId == INVALID_POINTER
-                                && ((isInDragHandle(x, y) && MathUtils.sq(x - mGestureStartX)
-                                        + MathUtils.sq(y - mGestureStartY) > mTouchSlopSquare)
-                                || crossedDragHandle(x, y, mGestureStartY)
+                                && (crossedDragHandle(x, y, mGestureStartY)
                                 || (isInChallengeView(x, y) &&
-                                       mScrollState == SCROLL_STATE_SETTLING))) {
+                                        mScrollState == SCROLL_STATE_SETTLING))) {
                         mActivePointerId = ev.getPointerId(i);
                         mGestureStartX = x;
                         mGestureStartY = y;
                         mGestureStartChallengeBottom = getChallengeBottom();
                         mDragging = true;
                         mChallengeView.setLayerType(LAYER_TYPE_HARDWARE, null);
-                    } else if (isInChallengeView(x, y)) {
+                    } else if (mChallengeShowing && isInChallengeView(x, y)) {
                         mBlockDrag = true;
                     }
                 }
@@ -767,11 +764,19 @@ public class SlidingChallengeLayout extends ViewGroup implements ChallengeLayout
     }
 
     private boolean crossedDragHandle(float x, float y, float initialY) {
+
         final int challengeTop = mChallengeView.getTop();
-        return  x >= 0 &&
-                x < getWidth() &&
-                initialY < (challengeTop - getDragHandleSizeAbove()) &&
-                y > challengeTop + getDragHandleSizeBelow();
+        final boolean horizOk = x >= 0 && x < getWidth();
+
+        final boolean vertOk;
+        if (mChallengeShowing) {
+            vertOk = initialY < (challengeTop - getDragHandleSizeAbove()) &&
+                    y > challengeTop + getDragHandleSizeBelow();
+        } else {
+            vertOk = initialY > challengeTop + getDragHandleSizeBelow() &&
+                    y < challengeTop - getDragHandleSizeAbove();
+        }
+        return horizOk && vertOk;
     }
 
     @Override