diff --git a/.changeset/light-goats-behave.md b/.changeset/light-goats-behave.md
new file mode 100644
index 000000000..7273a9594
--- /dev/null
+++ b/.changeset/light-goats-behave.md
@@ -0,0 +1,5 @@
+---
+"@preact/signals-core": patch
+---
+
+Refine signal function overloads to properly reflect optional value types
diff --git a/packages/core/src/index.ts b/packages/core/src/index.ts
index 1a4950217..8d38b9c25 100644
--- a/packages/core/src/index.ts
+++ b/packages/core/src/index.ts
@@ -420,7 +420,10 @@ Object.defineProperty(Signal.prototype, "value", {
  */
 export function signal<T>(value: T, options?: SignalOptions<T>): Signal<T>;
 export function signal<T = undefined>(): Signal<T | undefined>;
-export function signal<T>(value?: T, options?: SignalOptions<T>): Signal<T> {
+export function signal<T>(
+	value?: T,
+	options?: SignalOptions<T | undefined>
+): Signal<T | undefined> {
 	return new Signal(value, options);
 }