diff --git a/engine/baseclientstate.cpp b/engine/baseclientstate.cpp
index ed001afd8d..282938e2a4 100644
--- a/engine/baseclientstate.cpp
+++ b/engine/baseclientstate.cpp
@@ -175,7 +175,7 @@ void CL_ClanIdChanged( IConVar *pConVar, const char *pOldString, float flOldValu
 ConVar	cl_resend	( "cl_resend","6", FCVAR_NONE, "Delay in seconds before the client will resend the 'connect' attempt", true, CL_MIN_RESEND_TIME, true, CL_MAX_RESEND_TIME );
 ConVar	cl_name		( "name","unnamed", FCVAR_ARCHIVE | FCVAR_USERINFO | FCVAR_PRINTABLEONLY | FCVAR_SERVER_CAN_EXECUTE, "Current user name", CL_NameCvarChanged );
 ConVar	password	( "password", "", FCVAR_ARCHIVE | FCVAR_SERVER_CANNOT_QUERY | FCVAR_DONTRECORD, "Current server access password" );
-ConVar  cl_interpolate( "cl_interpolate", "1.0", FCVAR_USERINFO | FCVAR_DEVELOPMENTONLY | FCVAR_NOT_CONNECTED, "Interpolate entities on the client." );
+ConVar  cl_interpolate( "cl_interpolate", "1", FCVAR_USERINFO, "Interpolate entities on the client." );
 ConVar  cl_clanid( "cl_clanid", "0", FCVAR_ARCHIVE | FCVAR_USERINFO | FCVAR_HIDDEN, "Current clan ID for name decoration", CL_ClanIdChanged );
 ConVar  cl_show_connectionless_packet_warnings( "cl_show_connectionless_packet_warnings", "0", FCVAR_NONE, "Show console messages about ignored connectionless packets on the client." );
 
diff --git a/engine/client.cpp b/engine/client.cpp
index ee64d78694..5c0d99875c 100644
--- a/engine/client.cpp
+++ b/engine/client.cpp
@@ -47,6 +47,9 @@
 #include "matchmaking.h"
 #include "server.h"
 #include "eiface.h"
+#include "globalvars_base.h"
+
+extern CGlobalVarsBase* gpGlobals;
 
 #include "tier0/platform.h"
 #include "tier0/systeminformation.h"
@@ -623,6 +626,13 @@ float CClientState::GetFrameTime() const
 
 float CClientState::GetClientInterpAmount()
 {
+	static const ConVar *cl_interpolate = g_pCVar->FindVar("cl_interpolate");
+
+	if (!cl_interpolate->GetBool())
+	{
+		return 0.0f;
+	}
+
 	// we need client cvar cl_interp_ratio
 	static const ConVar *s_cl_interp_ratio = NULL;
 	if ( !s_cl_interp_ratio )
diff --git a/engine/host.cpp b/engine/host.cpp
index dbd43c65b2..02b0752bf8 100644
--- a/engine/host.cpp
+++ b/engine/host.cpp
@@ -3233,11 +3233,14 @@ void _Host_RunFrame (float time)
 				// Make sure state is correct
 				CL_CheckClientState();
 #endif
-				//-------------------
-				// input processing
-				//-------------------
+				//---------------------------------------------------------
+				// Run prediction, useful when fps is lower than tickrate.
+				//---------------------------------------------------------
+				CL_RunPrediction( PREDICTION_NORMAL );
+
 				_Host_RunFrame_Input( prevremainder, bFinalTick );
 				prevremainder = 0;
+
 				//-------------------
 				//
 				// server operations
@@ -3248,6 +3251,7 @@ void _Host_RunFrame (float time)
 
 				// Additional networking ops for SPLITPACKET stuff (99.9% of the time this will be an empty list of work)
 				NET_SendQueuedPackets();
+
 				//-------------------
 				//
 				// client operations
@@ -3438,6 +3442,8 @@ void _Host_RunFrame (float time)
 				++host_currentframetick;
 				g_ClientGlobalVariables.tickcount = host_tickcount;
 				bool bFinalTick = tick==(serverticks-1) ? true : false;
+				// Run prediction before inputs if fps is lower than tickrate
+				CL_RunPrediction( PREDICTION_NORMAL );
 				_Host_RunFrame_Input( prevremainder, bFinalTick );
 				prevremainder = 0;
 				// process any asynchronous network traffic (TCP), set net_time
diff --git a/game/client/c_baseentity.cpp b/game/client/c_baseentity.cpp
index 9e65f38843..bedeba6684 100644
--- a/game/client/c_baseentity.cpp
+++ b/game/client/c_baseentity.cpp
@@ -6,11 +6,13 @@
 //===========================================================================//
 #include "cbase.h"
 #include "c_baseentity.h"
+#include "interpolatedvar.h"
 #include "prediction.h"
 #include "model_types.h"
 #include "iviewrender_beams.h"
 #include "dlight.h"
 #include "iviewrender.h"
+#include "shareddefs.h"
 #include "view.h"
 #include "iefx.h"
 #include "c_team.h"
@@ -73,7 +75,7 @@ void cc_cl_interp_all_changed( IConVar *pConVar, const char *pOldString, float f
 }
 
 
-static ConVar  cl_extrapolate( "cl_extrapolate", "1", FCVAR_CHEAT, "Enable/disable extrapolation if interpolation history runs out." );
+static ConVar  cl_extrapolate( "cl_extrapolate", "0", FCVAR_CHEAT, "Enable/disable extrapolation if interpolation history runs out." );
 static ConVar  cl_interp_npcs( "cl_interp_npcs", "0.0", FCVAR_USERINFO, "Interpolate NPC positions starting this many seconds in past (or cl_interp, if greater)" );  
 static ConVar  cl_interp_all( "cl_interp_all", "0", 0, "Disable interpolation list optimizations.", 0, 0, 0, 0, cc_cl_interp_all_changed );
 ConVar  r_drawmodeldecals( "r_drawmodeldecals", "1" );
@@ -301,70 +303,6 @@ int CRecordingList::Count()
 
 // Should these be somewhere else?
 #define PITCH 0
-
-//-----------------------------------------------------------------------------
-// Purpose: Decodes animtime and notes when it changes
-// Input  : *pStruct - ( C_BaseEntity * ) used to flag animtime is changine
-//			*pVarData - 
-//			*pIn - 
-//			objectID - 
-//-----------------------------------------------------------------------------
-void RecvProxy_AnimTime( const CRecvProxyData *pData, void *pStruct, void *pOut )
-{
-	C_BaseEntity *pEntity = ( C_BaseEntity * )pStruct;
-	Assert( pOut == &pEntity->m_flAnimTime );
-
-	int t;
-	int tickbase;
-	int addt;
-
-	// Unpack the data.
-	addt	= pData->m_Value.m_Int;
-
-	// Note, this needs to be encoded relative to packet timestamp, not raw client clock
-	tickbase = gpGlobals->GetNetworkBase( gpGlobals->tickcount, pEntity->entindex() );
-
-	t = tickbase;
-											//  and then go back to floating point time.
-	t += addt;				// Add in an additional up to 256 100ths from the server
-
-	// center m_flAnimTime around current time.
-	while (t < gpGlobals->tickcount - 127)
-		t += 256;
-	while (t > gpGlobals->tickcount + 127)
-		t -= 256;
-	
-	pEntity->m_flAnimTime = ( t * TICK_INTERVAL );
-}
-
-void RecvProxy_SimulationTime( const CRecvProxyData *pData, void *pStruct, void *pOut )
-{
-	C_BaseEntity *pEntity = ( C_BaseEntity * )pStruct;
-	Assert( pOut == &pEntity->m_flSimulationTime );
-
-	int t;
-	int tickbase;
-	int addt;
-
-	// Unpack the data.
-	addt	= pData->m_Value.m_Int;
-
-	// Note, this needs to be encoded relative to packet timestamp, not raw client clock
-	tickbase = gpGlobals->GetNetworkBase( gpGlobals->tickcount, pEntity->entindex() );
-
-	t = tickbase;
-											//  and then go back to floating point time.
-	t += addt;				// Add in an additional up to 256 100ths from the server
-
-	// center m_flSimulationTime around current time.
-	while (t < gpGlobals->tickcount - 127)
-		t += 256;
-	while (t > gpGlobals->tickcount + 127)
-		t -= 256;
-	
-	pEntity->m_flSimulationTime = ( t * TICK_INTERVAL );
-}
-
 void RecvProxy_LocalVelocity( const CRecvProxyData *pData, void *pStruct, void *pOut )
 {
 	CBaseEntity *pEnt = (CBaseEntity *)pStruct;
@@ -417,7 +355,7 @@ void RecvProxy_EffectFlags( const CRecvProxyData *pData, void *pStruct, void *pO
 
 
 BEGIN_RECV_TABLE_NOBASE( C_BaseEntity, DT_AnimTimeMustBeFirst )
-	RecvPropInt( RECVINFO(m_flAnimTime), 0, RecvProxy_AnimTime ),
+	RecvPropFloat( RECVINFO(m_flAnimTime) ),
 END_RECV_TABLE()
 
 
@@ -431,7 +369,7 @@ END_RECV_TABLE()
 
 BEGIN_RECV_TABLE_NOBASE(C_BaseEntity, DT_BaseEntity)
 	RecvPropDataTable( "AnimTimeMustBeFirst", 0, 0, &REFERENCE_RECV_TABLE(DT_AnimTimeMustBeFirst) ),
-	RecvPropInt( RECVINFO(m_flSimulationTime), 0, RecvProxy_SimulationTime ),
+	RecvPropFloat( RECVINFO(m_flSimulationTime) ),
 	RecvPropInt( RECVINFO( m_ubInterpolationFrame ) ),
 
 	RecvPropVector( RECVINFO_NAME( m_vecNetworkOrigin, m_vecOrigin ) ),
@@ -890,10 +828,13 @@ inline int C_BaseEntity::Interp_Interpolate( VarMapping_t *map, float currentTim
 C_BaseEntity::C_BaseEntity() : 
 	m_iv_vecOrigin( "C_BaseEntity::m_iv_vecOrigin" ),
 	m_iv_angRotation( "C_BaseEntity::m_iv_angRotation" ),
-	m_iv_vecVelocity( "C_BaseEntity::m_iv_vecVelocity" )
+	m_iv_vecVelocity( "C_BaseEntity::m_iv_vecVelocity" ),
+	m_iv_flSimulationTime( "C_BaseEntity::m_iv_flSimulationTime" )
 {
 	AddVar( &m_vecOrigin, &m_iv_vecOrigin, LATCH_SIMULATION_VAR );
 	AddVar( &m_angRotation, &m_iv_angRotation, LATCH_SIMULATION_VAR );
+	// Needed for lag compensation
+	AddVar( &m_flInterpolatedSimulationTime, &m_iv_flSimulationTime, LATCH_SIMULATION_VAR );
 	// Removing this until we figure out why velocity introduces view hitching.
 	// One possible fix is removing the player->ResetLatched() call in CGameMovement::FinishDuck(), 
 	// but that re-introduces a third-person hitching bug.  One possible cause is the abrupt change
@@ -1010,6 +951,7 @@ void C_BaseEntity::Clear( void )
 	m_nModelIndex = 0;
 	m_flAnimTime = 0;
 	m_flSimulationTime = 0;
+	m_flInterpolatedSimulationTime = 0;
 	SetSolid( SOLID_NONE );
 	SetSolidFlags( 0 );
 	SetMoveCollide( MOVECOLLIDE_DEFAULT );
@@ -2549,6 +2491,10 @@ void C_BaseEntity::PostDataUpdate( DataUpdateType_t updateType )
 	bool anglesChanged = ( m_vecOldAngRotation != GetLocalAngles() ) ? true : false;
 	bool simTimeChanged = ( m_flSimulationTime != m_flOldSimulationTime ) ? true : false;
 
+	// Store simulation time for lag compensation.
+	if (simTimeChanged)
+		m_flInterpolatedSimulationTime = m_flSimulationTime;
+
 	// Detect simulation changes 
 	bool simulationChanged = originChanged || anglesChanged || simTimeChanged;
 
@@ -3173,7 +3119,7 @@ void C_BaseEntity::Simulate()
 }
 
 // Defined in engine
-static ConVar cl_interpolate( "cl_interpolate", "1.0f", FCVAR_USERINFO | FCVAR_DEVELOPMENTONLY );
+static ConVar cl_interpolate( "cl_interpolate", "1", FCVAR_USERINFO );
 
 // (static function)
 void C_BaseEntity::InterpolateServerEntities()
diff --git a/game/client/c_baseentity.h b/game/client/c_baseentity.h
index c62b732f07..c7265fc79f 100644
--- a/game/client/c_baseentity.h
+++ b/game/client/c_baseentity.h
@@ -1287,6 +1287,8 @@ public:
 
 	float							m_flSimulationTime;
 	float							m_flOldSimulationTime;
+	float							m_flInterpolatedSimulationTime;
+	CInterpolatedVar<float>					m_iv_flSimulationTime;
 	
 	float							m_flCreateTime;
 
diff --git a/game/client/c_func_rotating.cpp b/game/client/c_func_rotating.cpp
index 9d28bc268e..4066fd6240 100644
--- a/game/client/c_func_rotating.cpp
+++ b/game/client/c_func_rotating.cpp
@@ -31,7 +31,7 @@ IMPLEMENT_CLIENTCLASS_DT( C_FuncRotating, DT_FuncRotating, CFuncRotating )
 	RecvPropFloat( RECVINFO_NAME( m_angNetworkAngles[0], m_angRotation[0] ) ),
 	RecvPropFloat( RECVINFO_NAME( m_angNetworkAngles[1], m_angRotation[1] ) ),
 	RecvPropFloat( RECVINFO_NAME( m_angNetworkAngles[2], m_angRotation[2] ) ),
-	RecvPropInt( RECVINFO(m_flSimulationTime), 0, RecvProxy_SimulationTime ),
+	RecvPropFloat( RECVINFO(m_flSimulationTime) ),
 END_RECV_TABLE()
 
 
diff --git a/game/client/cdll_bounded_cvars.cpp b/game/client/cdll_bounded_cvars.cpp
index 0928b77481..01c98360bb 100644
--- a/game/client/cdll_bounded_cvars.cpp
+++ b/game/client/cdll_bounded_cvars.cpp
@@ -8,6 +8,7 @@
 #include "cbase.h"
 #include "cdll_bounded_cvars.h"
 #include "convar_serverbounded.h"
+#include "icvar.h"
 #include "tier0/icommandline.h"
 
 
@@ -22,7 +23,7 @@ class CBoundedCvar_Predict : public ConVar_ServerBounded
 public:
 	CBoundedCvar_Predict() :
 	  ConVar_ServerBounded( "cl_predict", 
-		  "1.0", 
+		  "1.0",
 #if defined(DOD_DLL) || defined(CSTRIKE_DLL)
 		  FCVAR_USERINFO | FCVAR_CHEAT, 
 #else
@@ -65,7 +66,7 @@ class CBoundedCvar_InterpRatio : public ConVar_ServerBounded
 public:
 	CBoundedCvar_InterpRatio() :
 	  ConVar_ServerBounded( "cl_interp_ratio", 
-		  "2.0", 
+		  "1.0",
 		  FCVAR_USERINFO | FCVAR_NOT_CONNECTED, 
 		  "Sets the interpolation amount (final amount is cl_interp_ratio / cl_updaterate)." )
 	  {
@@ -99,7 +100,7 @@ class CBoundedCvar_Interp : public ConVar_ServerBounded
 public:
 	CBoundedCvar_Interp() :
 	  ConVar_ServerBounded( "cl_interp", 
-		  "0.1", 
+		  "0.0",
 		  FCVAR_USERINFO | FCVAR_NOT_CONNECTED, 
 		  "Sets the interpolation amount (bounded on low side by server interp ratio settings).", true, 0.0f, true, 0.5f )
 	  {
@@ -125,7 +126,14 @@ ConVar_ServerBounded *cl_interp = &cl_interp_var;
 
 float GetClientInterpAmount()
 {
+	static const ConVar *cl_interpolate = g_pCVar->FindVar("cl_interpolate");
 	static const ConVar *pUpdateRate = g_pCVar->FindVar( "cl_updaterate" );
+
+	if (!cl_interpolate->GetBool())
+	{
+		return 0.0f;
+	}
+
 	if ( pUpdateRate )
 	{
 		// #define FIXME_INTERP_RATIO
@@ -138,7 +146,7 @@ float GetClientInterpAmount()
 			AssertMsgOnce( false, "GetInterpolationAmount: can't get cl_updaterate cvar." );
 		}
 	
-		return 0.1;
+		return 0.1f;
 	}
 }
 
diff --git a/game/client/in_main.cpp b/game/client/in_main.cpp
index 5275907850..df4451057b 100644
--- a/game/client/in_main.cpp
+++ b/game/client/in_main.cpp
@@ -9,7 +9,12 @@
 
 
 #include "cbase.h"
+#include "cdll_bounded_cvars.h"
+#include "cdll_client_int.h"
+#include "cdll_util.h"
+#include "dbg.h"
 #include "kbutton.h"
+#include "shareddefs.h"
 #include "usercmd.h"
 #include "in_buttons.h"
 #include "input.h"
@@ -20,6 +25,7 @@
 #include "checksum_md5.h"
 #include "touch.h"
 #include "hltvcamera.h"
+#include "util_shared.h"
 #if defined( REPLAY_ENABLED )
 #include "replay/replaycamera.h"
 #endif
@@ -1283,6 +1289,42 @@ void CInput::CreateMove ( int sequence_number, float input_sample_frametime, boo
 	m_EntityGroundContact.RemoveAll();
 #endif
 
+	// static bool firstTime = false;
+
+	// if (cmd->buttons & IN_ATTACK)
+	// {
+	// 	if (!firstTime)
+	// 	{
+	// 		for (int i = 0; i <= MAX_PLAYERS; i++)
+	// 		{
+	// 			auto pPlayer = UTIL_PlayerByIndex(i);
+
+	// 			if (pPlayer)
+	// 			{
+	// 				const auto &origin = pPlayer->GetAbsOrigin();
+	// 				DevMsg("Movement: %s => %f %f %f => %f\n", pPlayer->GetPlayerName(), origin.x, origin.y, origin.z, pPlayer->m_flInterpolatedSimulationTime);
+	// 			}
+	// 		}
+
+	// 		firstTime = true;
+	// 	}
+	// }
+	// else
+	// {
+	// 	firstTime = false;
+	// }
+
+	// Send interpolated simulation time for lag compensation
+	for (int i = 0; i <= MAX_PLAYERS; i++)
+	{
+		auto pPlayer = UTIL_PlayerByIndex(i);
+
+		if (pPlayer)
+		{
+			cmd->simulationtimes[pPlayer->index] = pPlayer->m_flInterpolatedSimulationTime;
+		}
+	}
+
 	pVerified->m_cmd = *cmd;
 	pVerified->m_crc = cmd->GetChecksum();
 }
diff --git a/game/server/baseentity.cpp b/game/server/baseentity.cpp
index 4ca5381076..7f72a30032 100644
--- a/game/server/baseentity.cpp
+++ b/game/server/baseentity.cpp
@@ -97,51 +97,6 @@ bool CBaseEntity::s_bAbsQueriesValid = true;
 
 ConVar sv_netvisdist( "sv_netvisdist", "10000", FCVAR_CHEAT | FCVAR_DEVELOPMENTONLY, "Test networking visibility distance" );
 
-// This table encodes edict data.
-void SendProxy_AnimTime( const SendProp *pProp, const void *pStruct, const void *pVarData, DVariant *pOut, int iElement, int objectID )
-{
-	CBaseEntity *pEntity = (CBaseEntity *)pStruct;
-
-#if defined( _DEBUG )
-	CBaseAnimating *pAnimating = pEntity->GetBaseAnimating();
-	Assert( pAnimating );
-
-	if ( pAnimating )
-	{
-		Assert( !pAnimating->IsUsingClientSideAnimation() );
-	}
-#endif
-	
-	int ticknumber = TIME_TO_TICKS( pEntity->m_flAnimTime );
-	// Tickbase is current tick rounded down to closes 100 ticks
-	int tickbase = gpGlobals->GetNetworkBase( gpGlobals->tickcount, pEntity->entindex() );
-	int addt = 0;
-	// If it's within the last tick interval through the current one, then we can encode it
-	if ( ticknumber >= ( tickbase - 100 ) )
-	{
-		addt = ( ticknumber - tickbase ) & 0xFF;
-	}
-
-	pOut->m_Int = addt;
-}
-
-// This table encodes edict data.
-void SendProxy_SimulationTime( const SendProp *pProp, const void *pStruct, const void *pVarData, DVariant *pOut, int iElement, int objectID )
-{
-	CBaseEntity *pEntity = (CBaseEntity *)pStruct;
-
-	int ticknumber = TIME_TO_TICKS( pEntity->m_flSimulationTime );
-	// tickbase is current tick rounded down to closest 100 ticks
-	int tickbase = gpGlobals->GetNetworkBase( gpGlobals->tickcount, pEntity->entindex() );
-	int addt = 0;
-	if ( ticknumber >= tickbase )
-	{
-		addt = ( ticknumber - tickbase ) & 0xff;
-	}
-
-	pOut->m_Int = addt;
-}
-
 void* SendProxy_ClientSideAnimation( const SendProp *pProp, const void *pStruct, const void *pVarData, CSendProxyRecipients *pRecipients, int objectID )
 {
 	CBaseEntity *pEntity = (CBaseEntity *)pStruct;
@@ -160,7 +115,7 @@ BEGIN_SEND_TABLE_NOBASE( CBaseEntity, DT_AnimTimeMustBeFirst )
 	//  proxy on the client that stores off the old values before writing in the new values and
 	//  if it is sent after the new values, then it will only have the new origin and studio model, etc.
 	//  interpolation will be busted
-	SendPropInt	(SENDINFO(m_flAnimTime), 8, SPROP_UNSIGNED|SPROP_CHANGES_OFTEN|SPROP_ENCODED_AGAINST_TICKCOUNT, SendProxy_AnimTime),
+	SendPropFloat (SENDINFO(m_flAnimTime)),
 END_SEND_TABLE()
 
 #if !defined( NO_ENTITY_PREDICTION )
@@ -259,7 +214,7 @@ void SendProxy_Angles( const SendProp *pProp, const void *pStruct, const void *p
 // This table encodes the CBaseEntity data.
 IMPLEMENT_SERVERCLASS_ST_NOBASE( CBaseEntity, DT_BaseEntity )
 	SendPropDataTable( "AnimTimeMustBeFirst", 0, &REFERENCE_SEND_TABLE(DT_AnimTimeMustBeFirst), SendProxy_ClientSideAnimation ),
-	SendPropInt			(SENDINFO(m_flSimulationTime),	SIMULATION_TIME_WINDOW_BITS, SPROP_UNSIGNED|SPROP_CHANGES_OFTEN|SPROP_ENCODED_AGAINST_TICKCOUNT, SendProxy_SimulationTime),
+	SendPropFloat	(SENDINFO(m_flSimulationTime)),
 
 #if PREDICTION_ERROR_CHECK_LEVEL > 1 
 	SendPropVector	(SENDINFO(m_vecOrigin), -1,  SPROP_NOSCALE|SPROP_CHANGES_OFTEN, 0.0f, HIGH_DEFAULT, SendProxy_Origin ),
diff --git a/game/server/bmodels.cpp b/game/server/bmodels.cpp
index 71be7d397f..da69ca03a9 100644
--- a/game/server/bmodels.cpp
+++ b/game/server/bmodels.cpp
@@ -560,24 +560,6 @@ void SendProxy_FuncRotatingAngle( const SendProp *pProp, const void *pStruct, co
 	Assert( IsFinite( pOut->m_Float ) );
 }
 
-
-extern void SendProxy_SimulationTime( const SendProp *pProp, const void *pStruct, const void *pVarData, DVariant *pOut, int iElement, int objectID );
-void SendProxy_FuncRotatingSimulationTime( const SendProp *pProp, const void *pStruct, const void *pVarData, DVariant *pOut, int iElement, int objectID )
-{
-#ifdef TF_DLL
-	CFuncRotating *entity = (CFuncRotating*)pStruct;
-	Assert( entity );
-
-	if ( entity->HasSpawnFlags(SF_BRUSH_ROTATE_CLIENTSIDE) )
-	{
-		pOut->m_Int = 0;
-		return;
-	}
-#endif
-
-	SendProxy_SimulationTime( pProp, pStruct, pVarData, pOut, iElement, objectID );
-}
-
 IMPLEMENT_SERVERCLASS_ST(CFuncRotating, DT_FuncRotating)
 	SendPropExclude( "DT_BaseEntity", "m_angRotation" ),
 	SendPropExclude( "DT_BaseEntity", "m_vecOrigin" ),
@@ -588,7 +570,7 @@ IMPLEMENT_SERVERCLASS_ST(CFuncRotating, DT_FuncRotating)
 	SendPropAngle( SENDINFO_VECTORELEM(m_angRotation, 1), 13, SPROP_CHANGES_OFTEN, SendProxy_FuncRotatingAngle ),
 	SendPropAngle( SENDINFO_VECTORELEM(m_angRotation, 2), 13, SPROP_CHANGES_OFTEN, SendProxy_FuncRotatingAngle ),
 
-	SendPropInt(SENDINFO(m_flSimulationTime), SIMULATION_TIME_WINDOW_BITS, SPROP_UNSIGNED|SPROP_CHANGES_OFTEN|SPROP_ENCODED_AGAINST_TICKCOUNT, SendProxy_FuncRotatingSimulationTime),
+	SendPropFloat(SENDINFO(m_flSimulationTime))
 END_SEND_TABLE()
 
 
diff --git a/game/server/cstrike/cs_player.cpp b/game/server/cstrike/cs_player.cpp
index 79ed9c1497..210812699e 100644
--- a/game/server/cstrike/cs_player.cpp
+++ b/game/server/cstrike/cs_player.cpp
@@ -4181,23 +4181,9 @@ void CCSPlayer::NoteWeaponFired()
 }
 
 
-bool CCSPlayer::WantsLagCompensationOnEntity( const CBasePlayer *pPlayer, const CUserCmd *pCmd, const CBitVec<MAX_EDICTS> *pEntityTransmitBits ) const
+bool CCSPlayer::WantsLagCompensationOnEntity( const CBasePlayer *pPlayer, const CUserCmd *pCmd, const CBitVec<MAX_EDICTS> *pEntityTransmitBits )
 {
-	// No need to lag compensate at all if we're not attacking in this command and
-	// we haven't attacked recently.
-	if ( !( pCmd->buttons & IN_ATTACK ) && (pCmd->command_number - m_iLastWeaponFireUsercmd > 5) )
-	{
-		if ( ( pCmd->buttons & IN_ATTACK2 ) == 0 )
-			return false;
-
-		CWeaponCSBase *weapon = GetActiveCSWeapon();
-		if ( !weapon )
-			return false;
-
-		if ( weapon->GetWeaponID() != WEAPON_KNIFE )
-			return false;	// IN_ATTACK2 with WEAPON_KNIFE should do lag compensation
-	}
-
+	// No need to check for IN_ATTACK etc since it is called in firebullet
 	return BaseClass::WantsLagCompensationOnEntity( pPlayer, pCmd, pEntityTransmitBits );
 }
 
diff --git a/game/server/cstrike/cs_player.h b/game/server/cstrike/cs_player.h
index 9abf96a67d..9448131d4d 100644
--- a/game/server/cstrike/cs_player.h
+++ b/game/server/cstrike/cs_player.h
@@ -508,7 +508,7 @@ public:
 
 	// Called whenever this player fires a shot.
 	void NoteWeaponFired();
-	virtual bool WantsLagCompensationOnEntity( const CBasePlayer *pPlayer, const CUserCmd *pCmd, const CBitVec<MAX_EDICTS> *pEntityTransmitBits ) const;
+	virtual bool WantsLagCompensationOnEntity( const CBasePlayer *pPlayer, const CUserCmd *pCmd, const CBitVec<MAX_EDICTS> *pEntityTransmitBits );
 
 // ------------------------------------------------------------------------------------------------ //
 // Player state management.
diff --git a/game/server/gameinterface.cpp b/game/server/gameinterface.cpp
index e434f9d401..364b63d179 100644
--- a/game/server/gameinterface.cpp
+++ b/game/server/gameinterface.cpp
@@ -2831,33 +2831,6 @@ void CServerGameClients::ClientSettingsChanged( edict_t *pEdict )
 	static const ConVar *pMaxUpdateRate = g_pCVar->FindVar( "sv_maxupdaterate" );
 	if ( pMinUpdateRate && pMaxUpdateRate )
 		player->m_nUpdateRate = clamp( player->m_nUpdateRate, (int) pMinUpdateRate->GetFloat(), (int) pMaxUpdateRate->GetFloat() );
-
-	bool useInterpolation = Q_atoi( QUICKGETCVARVALUE("cl_interpolate") ) != 0;
-	if ( useInterpolation )
-	{
-		float flLerpRatio = Q_atof( QUICKGETCVARVALUE("cl_interp_ratio") );
-		if ( flLerpRatio == 0 )
-			flLerpRatio = 1.0f;
-		float flLerpAmount = Q_atof( QUICKGETCVARVALUE("cl_interp") );
-
-		static const ConVar *pMin = g_pCVar->FindVar( "sv_client_min_interp_ratio" );
-		static const ConVar *pMax = g_pCVar->FindVar( "sv_client_max_interp_ratio" );
-		if ( pMin && pMax && pMin->GetFloat() != -1 )
-		{
-			flLerpRatio = clamp( flLerpRatio, pMin->GetFloat(), pMax->GetFloat() );
-		}
-		else
-		{
-			if ( flLerpRatio == 0 )
-				flLerpRatio = 1.0f;
-		}
-		// #define FIXME_INTERP_RATIO
-		player->m_fLerpTime = MAX( flLerpAmount, flLerpRatio / player->m_nUpdateRate );
-	}
-	else
-	{
-		player->m_fLerpTime = 0.0f;
-	}
 	
 #if !defined( NO_ENTITY_PREDICTION )
 	bool usePrediction = Q_atoi( QUICKGETCVARVALUE("cl_predict")) != 0;
diff --git a/game/server/player.cpp b/game/server/player.cpp
index 18aededa7d..c65daa5e75 100644
--- a/game/server/player.cpp
+++ b/game/server/player.cpp
@@ -283,7 +283,6 @@ BEGIN_DATADESC( CBasePlayer )
 //	DEFINE_CUSTOM_FIELD( m_Activity, ActivityDataOps() ),
 
 	DEFINE_FIELD( m_nUpdateRate, FIELD_INTEGER ),
-	DEFINE_FIELD( m_fLerpTime, FIELD_FLOAT ),
 	DEFINE_FIELD( m_bLagCompensation, FIELD_BOOLEAN ),
 	DEFINE_FIELD( m_bPredictWeapons, FIELD_BOOLEAN ),
 
@@ -592,7 +591,6 @@ CBasePlayer::CBasePlayer( )
 	m_hZoomOwner = NULL;
 
 	m_nUpdateRate = 20;  // cl_updaterate defualt
-	m_fLerpTime = 0.1f; // cl_interp default
 	m_bPredictWeapons = true;
 	m_bLagCompensation = false;
 	m_flLaggedMovementValue = 1.0f;
@@ -724,37 +722,46 @@ int CBasePlayer::ShouldTransmit( const CCheckTransmitInfo *pInfo )
 	return BaseClass::ShouldTransmit( pInfo );
 }
 
+static void NormalizeAngles( QAngle& angles )
+{
+	int i;
 
-bool CBasePlayer::WantsLagCompensationOnEntity( const CBasePlayer *pPlayer, const CUserCmd *pCmd, const CBitVec<MAX_EDICTS> *pEntityTransmitBits ) const
+	// Normalize angles to -180 to 180 range
+	for ( i = 0; i < 3; i++ )
+	{
+		if ( angles[i] > 180.0 )
+		{
+			angles[i] -= 360.0;
+		}
+		else if ( angles[i] < -180.0 )
+		{
+			angles[i] += 360.0;
+		}
+	}
+}
+
+bool CBasePlayer::WantsLagCompensationOnEntity( const CBasePlayer *pPlayer, const CUserCmd *pCmd, const CBitVec<MAX_EDICTS> *pEntityTransmitBits )
 {
 	// Team members shouldn't be adjusted unless friendly fire is on.
 	if ( !friendlyfire.GetInt() && pPlayer->GetTeamNumber() == GetTeamNumber() )
 		return false;
 
-	// If this entity hasn't been transmitted to us and acked, then don't bother lag compensating it.
-	if ( pEntityTransmitBits && !pEntityTransmitBits->Get( pPlayer->entindex() ) )
-		return false;
-
-	const Vector &vMyOrigin = GetAbsOrigin();
+	Vector vShootPosition = Weapon_ShootPosition();
 	const Vector &vHisOrigin = pPlayer->GetAbsOrigin();
 
-	// get max distance player could have moved within max lag compensation time, 
-	// multiply by 1.5 to to avoid "dead zones"  (sqrt(2) would be the exact value)
-	float maxDistance = 1.5 * pPlayer->MaxSpeed() * sv_maxunlag.GetFloat();
-
-	// If the player is within this distance, lag compensate them in case they're running past us.
-	if ( vHisOrigin.DistTo( vMyOrigin ) < maxDistance )
-		return true;
-
 	// If their origin is not within a 45 degree cone in front of us, no need to lag compensate.
-	Vector vForward;
-	AngleVectors( pCmd->viewangles, &vForward );
-	
-	Vector vDiff = vHisOrigin - vMyOrigin;
+	Vector vDiff = vHisOrigin - vShootPosition;
 	VectorNormalize( vDiff );
 
-	float flCosAngle = 0.707107f;	// 45 degree angle
-	if ( vForward.Dot( vDiff ) < flCosAngle )
+	QAngle aDiff;
+	VectorAngles(vDiff, aDiff);
+
+	aDiff = pCmd->viewangles - aDiff;
+	NormalizeAngles(aDiff);
+
+	// 90 degree angle, just to be sure;
+	static constexpr auto flMaxAngle = 90.f;
+	if ( abs( aDiff.x ) > flMaxAngle && abs( aDiff.y ) > flMaxAngle )
 		return false;
 
 	return true;
diff --git a/game/server/player.h b/game/server/player.h
index ddbd441621..898d4bfc0d 100644
--- a/game/server/player.h
+++ b/game/server/player.h
@@ -282,7 +282,7 @@ public:
 	// Returns true if this player wants pPlayer to be moved back in time when this player runs usercmds.
 	// Saves a lot of overhead on the server if we can cull out entities that don't need to lag compensate
 	// (like team members, entities out of our PVS, etc).
-	virtual bool			WantsLagCompensationOnEntity( const CBasePlayer	*pPlayer, const CUserCmd *pCmd, const CBitVec<MAX_EDICTS> *pEntityTransmitBits ) const;
+	virtual bool			WantsLagCompensationOnEntity( const CBasePlayer	*pPlayer, const CUserCmd *pCmd, const CBitVec<MAX_EDICTS> *pEntityTransmitBits );
 
 	virtual void			Spawn( void );
 	virtual void			Activate( void );
@@ -873,7 +873,6 @@ public:
 	char					m_szAnimExtension[32];
 
 	int						m_nUpdateRate;		// user snapshot rate cl_updaterate
-	float					m_fLerpTime;		// users cl_interp
 	bool					m_bLagCompensation;	// user wants lag compenstation
 	bool					m_bPredictWeapons; //  user has client side predicted weapons
 	
diff --git a/game/server/player_lagcompensation.cpp b/game/server/player_lagcompensation.cpp
index 3a7f41237f..1c107d1362 100644
--- a/game/server/player_lagcompensation.cpp
+++ b/game/server/player_lagcompensation.cpp
@@ -26,7 +26,6 @@
 #define LC_ANIMATION_CHANGED (1<<11)
 #define LC_POSE_PARAMS_CHANGED (1<<12)
 
-static ConVar sv_lagcompensation_teleport_dist( "sv_lagcompensation_teleport_dist", "64", FCVAR_DEVELOPMENTONLY | FCVAR_CHEAT, "How far a player got moved by game code before we can't lag compensate their position back" );
 #define LAG_COMPENSATION_EPS_SQR ( 0.1f * 0.1f )
 // Allow 4 units of error ( about 1 / 8 bbox width )
 #define LAG_COMPENSATION_ERROR_EPS_SQR ( 4.0f * 4.0f )
@@ -173,7 +172,7 @@ static void RestorePlayerTo( CBasePlayer *pPlayer, const Vector &vWantedPos )
 class CLagCompensationManager : public CAutoGameSystemPerFrame, public ILagCompensationManager
 {
 public:
-	CLagCompensationManager( char const *name ) : CAutoGameSystemPerFrame( name ), m_flTeleportDistanceSqr( 64 *64 )
+	CLagCompensationManager( char const *name ) : CAutoGameSystemPerFrame( name )
 	{
 	}
 
@@ -217,8 +216,6 @@ private:
 	LagRecord				m_ChangeData[ MAX_PLAYERS ];	// player data where we moved him back
 
 	CBasePlayer				*m_pCurrentPlayer;	// The player we are doing lag compensation for
-
-	float					m_flTeleportDistanceSqr;
 };
 
 static CLagCompensationManager g_LagCompensationManager( "CLagCompensationManager" );
@@ -235,8 +232,6 @@ void CLagCompensationManager::FrameUpdatePostEntityThink()
 		ClearHistory();
 		return;
 	}
-	
-	m_flTeleportDistanceSqr = sv_lagcompensation_teleport_dist.GetFloat() * sv_lagcompensation_teleport_dist.GetFloat();
 
 	VPROF_BUDGET( "FrameUpdatePostEntityThink", "CLagCompensationManager" );
 
@@ -362,12 +357,6 @@ void CLagCompensationManager::StartLagCompensation( CBasePlayer *player, CUserCm
 	Q_memset( m_RestoreData, 0, sizeof( m_RestoreData ) );
 	Q_memset( m_ChangeData, 0, sizeof( m_ChangeData ) );
 
-	// calc number of view interpolation ticks - 1
-	int lerpTicks = TIME_TO_TICKS( player->m_fLerpTime );
-
-	// correct tick send by player 
-	int targettick = cmd->tick_count - lerpTicks;
-	
 	// Iterate all active players
 	const CBitVec<MAX_EDICTS> *pEntityTransmitBits = engine->GetEntityTransmitBitsForClient( player->entindex() - 1 );
 	for ( int i = 1; i <= gpGlobals->maxClients; i++ )
@@ -390,7 +379,7 @@ void CLagCompensationManager::StartLagCompensation( CBasePlayer *player, CUserCm
 			continue;
 
 		// Move other player back in time
-		BacktrackPlayer( pPlayer, TICKS_TO_TIME( targettick ) );
+		BacktrackPlayer( pPlayer, cmd->simulationtimes[i] );
 	}
 }
 
@@ -433,12 +422,7 @@ void CLagCompensationManager::BacktrackPlayer( CBasePlayer *pPlayer, float flTar
 			return;
 		}
 
-		Vector delta = record->m_vecOrigin - prevOrg;
-		if ( delta.Length2DSqr() > m_flTeleportDistanceSqr )
-		{
-			// lost track, too much difference
-			return; 
-		}
+		// TODO: do proper teleportation checks.
 
 		// did we find a context smaller than target time ?
 		if ( record->m_flSimulationTime <= flTargetTime )
@@ -728,6 +712,9 @@ void CLagCompensationManager::BacktrackPlayer( CBasePlayer *pPlayer, float flTar
 	{
 		pPlayer->DrawServerHitboxes(4, true);
 	}
+
+	// DevMsg("Server: %s => %f %f %f => %f (frac: %f)\n", pPlayer->GetPlayerName(), change->m_vecOrigin.x, change->m_vecOrigin.y, change->m_vecOrigin.z, flTargetTime, frac);
+
 }
 
 
@@ -799,11 +786,7 @@ void CLagCompensationManager::FinishLagCompensation( CBasePlayer *player )
 			// Okay, let's see if we can do something reasonable with the change
 			Vector delta = pPlayer->GetLocalOrigin() - change->m_vecOrigin;
 			
-			// If it moved really far, just leave the player in the new spot!!!
-			if ( delta.Length2DSqr() < m_flTeleportDistanceSqr )
-			{
-				RestorePlayerTo( pPlayer, restore->m_vecOrigin + delta );
-			}
+			RestorePlayerTo( pPlayer, restore->m_vecOrigin + delta );
 		}
 
 		if( restore->m_fFlags & LC_ANIMATION_CHANGED )
diff --git a/game/shared/cstrike/cs_player_shared.cpp b/game/shared/cstrike/cs_player_shared.cpp
index c35a4da46e..b46003f87c 100644
--- a/game/shared/cstrike/cs_player_shared.cpp
+++ b/game/shared/cstrike/cs_player_shared.cpp
@@ -417,6 +417,8 @@ void CCSPlayer::FireBullet(
 		{
 #ifdef CLIENT_DLL
 			lagPlayer->DrawClientHitboxes(4, true);
+			//DevMsg("Client: %s => %f %f %f => %f\n", lagPlayer->GetPlayerName(), lagPlayer->GetAbsOrigin().x, lagPlayer->GetAbsOrigin().y, lagPlayer->GetAbsOrigin().z,
+			//	lagPlayer->m_flInterpolatedSimulationTime);
 #else
 			lagPlayer->DrawServerHitboxes(4, true);
 #endif
diff --git a/game/shared/shareddefs.h b/game/shared/shareddefs.h
index d3b23263d0..8e35691e1b 100644
--- a/game/shared/shareddefs.h
+++ b/game/shared/shareddefs.h
@@ -873,11 +873,6 @@ enum
 	RT_STATE_NORMAL,	// Timer is in normal mode
 };
 
-enum
-{
-	SIMULATION_TIME_WINDOW_BITS = 8,
-};
-
 //-----------------------------------------------------------------------------
 // Commentary Mode
 //-----------------------------------------------------------------------------
diff --git a/game/shared/usercmd.cpp b/game/shared/usercmd.cpp
index 84ffa24314..436840de8b 100644
--- a/game/shared/usercmd.cpp
+++ b/game/shared/usercmd.cpp
@@ -11,7 +11,15 @@
 #include "checksum_md5.h"
 
 // memdbgon must be the last include file in a .cpp file!!!
+#ifdef CLIENT_DLL
+#include "c_baseplayer.h"
+#else
+#include "player.h"
+#endif
+#include "shareddefs.h"
 #include "tier0/memdbgon.h"
+#include "util_shared.h"
+#include "utlvector.h"
 
 // TF2 specific, need enough space for OBJ_LAST items from tf_shareddefs.h
 #define WEAPON_SUBTYPE_BITS	6
@@ -169,6 +177,19 @@ void WriteUsercmd( bf_write *buf, const CUserCmd *to, const CUserCmd *from )
 		buf->WriteOneBit( 0 );
 	}
 
+	for (int i = 0; i <= MAX_PLAYERS; i++)
+	{
+		if (to->simulationtimes[i] != from->simulationtimes[i])
+		{
+			buf->WriteOneBit( 1 );
+			buf->WriteFloat( to->simulationtimes[i] );
+		}
+		else
+		{
+			buf->WriteOneBit(0);
+		}
+	}
+
 #if defined( HL2_CLIENT_DLL )
 	if ( to->entitygroundcontact.Count() != 0 )
 	{
@@ -289,6 +310,15 @@ void ReadUsercmd( bf_read *buf, CUserCmd *move, CUserCmd *from )
 		move->mousedy = buf->ReadShort();
 	}
 
+	for (int i = 0; i <= MAX_PLAYERS; i++)
+	{
+		// Simulation time changed unexpectedly ?
+		if (buf->ReadOneBit())
+		{
+			move->simulationtimes[i] = buf->ReadFloat();
+		}
+	}
+
 #if defined( HL2_DLL )
 	if ( buf->ReadOneBit() )
 	{
diff --git a/game/shared/usercmd.h b/game/shared/usercmd.h
index 20b4034594..6982e6c373 100644
--- a/game/shared/usercmd.h
+++ b/game/shared/usercmd.h
@@ -5,6 +5,7 @@
 // $NoKeywords: $
 //
 //=============================================================================//
+#include "shareddefs.h"
 #if !defined( USERCMD_H )
 #define USERCMD_H
 #ifdef _WIN32
@@ -55,6 +56,10 @@ public:
 		mousedy = 0;
 
 		hasbeenpredicted = false;
+
+		for (int i = 0; i <= MAX_PLAYERS; i++)
+			simulationtimes[i] = 0.0f;
+
 #if defined( HL2_DLL ) || defined( HL2_CLIENT_DLL )
 		entitygroundcontact.RemoveAll();
 #endif
@@ -81,6 +86,8 @@ public:
 
 		hasbeenpredicted	= src.hasbeenpredicted;
 
+		for (int i = 0; i <= MAX_PLAYERS; i++)
+			simulationtimes[i] = src.simulationtimes[i];
 #if defined( HL2_DLL ) || defined( HL2_CLIENT_DLL )
 		entitygroundcontact			= src.entitygroundcontact;
 #endif
@@ -111,6 +118,7 @@ public:
 		CRC32_ProcessBuffer( &crc, &random_seed, sizeof( random_seed ) );
 		CRC32_ProcessBuffer( &crc, &mousedx, sizeof( mousedx ) );
 		CRC32_ProcessBuffer( &crc, &mousedy, sizeof( mousedy ) );
+		CRC32_ProcessBuffer( &crc, &simulationtimes, sizeof( simulationtimes ) );
 		CRC32_Final( &crc );
 
 		return crc;
@@ -158,6 +166,10 @@ public:
 	// Client only, tracks whether we've predicted this command at least once
 	bool	hasbeenpredicted;
 
+	// TODO_ENHANCED: Lag compensate also other entities when needed.
+	// Send simulation times for each players for lag compensation.
+	float 	simulationtimes[MAX_PLAYERS+1];
+
 	// Back channel to communicate IK state
 #if defined( HL2_DLL ) || defined( HL2_CLIENT_DLL )
 	CUtlVector< CEntityGroundContact > entitygroundcontact;