diff --git a/Readme.md b/Readme.md
index db6dcb3..b7c5c6a 100644
--- a/Readme.md
+++ b/Readme.md
@@ -44,8 +44,7 @@ HMAC result is truncated to 12 bytes, producing a 16 characters encoded signatur
 `ext_url` is the result of `urlsafe-base64(image_url)`. Trailing `=` may be stripped.
 
 `extension` is either the empty string or the string `/proxy` which instructs
-the imageproxy server to not permanently store the source image. Resizing is
-not supported in proxy-only mode.
+the imageproxy server to not permanently store the source image.
 
 ## Signature test vector
 
diff --git a/main.py b/main.py
index b8e93a9..1b22efd 100644
--- a/main.py
+++ b/main.py
@@ -145,15 +145,16 @@ async def handle_signed_request(request: Request) -> Response:
     is_proxy = len(url) == 4 and url[3] == 'proxy'
 
     try:
-        imgproxy_opts = [] if is_proxy else parse_imgproxy_params(url[0])
+        imgproxy_opts = parse_imgproxy_params(url[0])
     except BadOptions:
         logger.debug("invalid resize options: %s", url[0])
         return bad_request()
 
     is_resize = bool(imgproxy_opts)
+    if not is_proxy:
+        imgproxy_opts.append(b'fn:' + img_url)
 
     img_path = create_filename(bucket, img_url)
-    imgproxy_opts.append(b'fn:' + img_url)
 
     # download and perma-store image through imgproxy
     base_path = request.get_first_header(b'root_dir').decode('ascii')
diff --git a/nginx/imgproxy.conf b/nginx/imgproxy.conf
index 8eff8ad..a0d6f0a 100644
--- a/nginx/imgproxy.conf
+++ b/nginx/imgproxy.conf
@@ -53,15 +53,16 @@ server {
         set $img_url $upstream_http_imgproxy_url;
         add_header Content-Type "";
         add_header x-original-url $upstream_http_x_original_url;
-        rewrite .* /$loc_prefix/${imgproxy_opts}plain/local:///${img_path};
+        rewrite .* /${loc_prefix}/${imgproxy_opts}plain/local:///${img_path};
     }
 
     location @serve-imgproxy-remote {
         # for non-cached images
+        set $imgproxy_opts $imgproxy_opts/$upstream_http_imgproxy_opts;
         set $img_url $upstream_http_imgproxy_url;
         add_header Content-Type "";
         add_header x-original-url $upstream_http_x_original_url;
-        rewrite .* /$loc_prefix/${img_url};
+        rewrite .* /${loc_prefix}/${imgproxy_opts}/${img_url};
     }
 
     location @serve-proxy {