diff --git a/include/labwc.h b/include/labwc.h
index 83f37dca..da07a3e1 100644
--- a/include/labwc.h
+++ b/include/labwc.h
@@ -47,6 +47,7 @@
 #include "config/rcxml.h"
 #include "input/cursor.h"
 #include "input/ime.h"
+#include "overlay.h"
 #include "regions.h"
 #include "session-lock.h"
 #if HAVE_NLS
@@ -159,9 +160,8 @@ struct seat {
 		struct wlr_scene_tree *icons;
 	} drag;
 
-	/* Private use by regions.c */
-	struct region *region_active;
-	struct region_overlay region_overlay;
+	/* Private use by overlay.c */
+	struct overlay overlay;
 	/* Used to prevent region snapping when starting a move with A-Left */
 	bool region_prevent_snap;
 
@@ -479,6 +479,8 @@ void seat_output_layout_changed(struct seat *seat);
 void interactive_begin(struct view *view, enum input_mode mode, uint32_t edges);
 void interactive_finish(struct view *view);
 void interactive_cancel(struct view *view);
+/* Possibly returns VIEW_EDGE_CENTER if <topMaximize> is yes */
+enum view_edge edge_from_cursor(struct seat *seat, struct output **dest_output);
 
 void output_init(struct server *server);
 void output_manager_init(struct server *server);
diff --git a/include/overlay.h b/include/overlay.h
new file mode 100644
index 00000000..e5035c7b
--- /dev/null
+++ b/include/overlay.h
@@ -0,0 +1,25 @@
+/* SPDX-License-Identifier: GPL-2.0-only */
+#ifndef LABWC_OVERLAY_H
+#define LABWC_OVERLAY_H
+
+#include <wlr/util/box.h>
+#include "common/graphic-helpers.h"
+
+struct overlay {
+	struct wlr_scene_tree *tree;
+	union {
+		struct wlr_scene_rect *rect;
+		struct multi_rect *pixman_rect;
+	};
+
+	/* For delayed overlay */
+	struct view *view;
+	struct wlr_box box;
+	struct wl_event_source *timer;
+};
+
+/* Calls overlay_hide() internally if the view is not to be snapped */
+void overlay_show(struct seat *seat, struct view *view);
+void overlay_hide(struct seat *seat);
+
+#endif
diff --git a/include/regions.h b/include/regions.h
index 6638f9f3..abe472be 100644
--- a/include/regions.h
+++ b/include/regions.h
@@ -25,14 +25,6 @@ struct region {
 	} center;
 };
 
-struct region_overlay {
-	struct wlr_scene_tree *tree;
-	union {
-		struct wlr_scene_rect *overlay;
-		struct multi_rect *pixman_overlay;
-	};
-};
-
 /* Returns true if we should show the region overlay or snap to region */
 bool regions_should_snap(struct server *server);
 
@@ -73,7 +65,4 @@ void regions_destroy(struct seat *seat, struct wl_list *regions);
 struct region *regions_from_cursor(struct server *server);
 struct region *regions_from_name(const char *region_name, struct output *output);
 
-void regions_show_overlay(struct view *view, struct seat *seat, struct region *region);
-void regions_hide_overlay(struct seat *seat);
-
 #endif /* LABWC_REGIONS_H */
diff --git a/src/debug.c b/src/debug.c
index d8b9c179..3b79f7ac 100644
--- a/src/debug.c
+++ b/src/debug.c
@@ -136,10 +136,10 @@ get_special(struct server *server, struct wlr_scene_node *node)
 	if (node == &server->seat.drag.icons->node) {
 		return "seat->drag.icons";
 	}
-	if (server->seat.region_overlay.tree
-			&& node == &server->seat.region_overlay.tree->node) {
+	if (server->seat.overlay.tree
+			&& node == &server->seat.overlay.tree->node) {
 		/* Created on-demand */
-		return "seat->region_overlay";
+		return "seat->overlay";
 	}
 	if (server->seat.input_method_relay->popup_tree
 			&& node == &server->seat.input_method_relay->popup_tree->node) {
diff --git a/src/input/cursor.c b/src/input/cursor.c
index eb359e71..04334389 100644
--- a/src/input/cursor.c
+++ b/src/input/cursor.c
@@ -225,16 +225,7 @@ process_cursor_move(struct server *server, uint32_t time)
 	resistance_move_apply(view, &dx, &dy);
 	view_move(view, dx, dy);
 
-	/* Region overlay */
-	if (!regions_should_snap(server)) {
-		return;
-	}
-	struct region *region = regions_from_cursor(server);
-	if (region) {
-		regions_show_overlay(view, &server->seat, region);
-	} else {
-		regions_hide_overlay(&server->seat);
-	}
+	overlay_show(&server->seat, view);
 }
 
 static void
diff --git a/src/input/keyboard.c b/src/input/keyboard.c
index 0ca6d390..fb7ac204 100644
--- a/src/input/keyboard.c
+++ b/src/input/keyboard.c
@@ -82,9 +82,9 @@ keyboard_modifiers_notify(struct wl_listener *listener, void *data)
 		seat->region_prevent_snap = false;
 	}
 
-	if (server->osd_state.cycle_view || server->grabbed_view
+	if (server->osd_state.cycle_view
 			|| seat->workspace_osd_shown_by_modifier) {
-		if (!keyboard_any_modifiers_pressed(wlr_keyboard))  {
+		if (!keyboard_any_modifiers_pressed(wlr_keyboard)) {
 			if (server->osd_state.cycle_view) {
 				if (key_state_nr_bound_keys()) {
 					should_cancel_cycling_on_next_key_release = true;
@@ -95,11 +95,12 @@ keyboard_modifiers_notify(struct wl_listener *listener, void *data)
 			if (seat->workspace_osd_shown_by_modifier) {
 				workspaces_osd_hide(seat);
 			}
-			if (server->grabbed_view) {
-				regions_hide_overlay(seat);
-			}
 		}
 	}
+	/* Pressing/releasing modifier key may show/hide region overlay */
+	if (server->grabbed_view) {
+		overlay_show(seat, server->grabbed_view);
+	}
 
 	if (!input_method_keyboard_grab_forward_modifiers(keyboard)) {
 		wlr_seat_keyboard_notify_modifiers(seat->seat,
diff --git a/src/interactive.c b/src/interactive.c
index a0b4f255..243aaa6a 100644
--- a/src/interactive.c
+++ b/src/interactive.c
@@ -129,39 +129,53 @@ interactive_begin(struct view *view, enum input_mode mode, uint32_t edges)
 	}
 }
 
+enum view_edge
+edge_from_cursor(struct seat *seat, struct output **dest_output)
+{
+	int snap_range = rc.snap_edge_range;
+	if (!snap_range) {
+		return VIEW_EDGE_INVALID;
+	}
+
+	struct output *output = output_nearest_to_cursor(seat->server);
+	if (!output_is_usable(output)) {
+		wlr_log(WLR_ERROR, "output at cursor is unusable");
+		return VIEW_EDGE_INVALID;
+	}
+	*dest_output = output;
+
+	/* Translate into output local coordinates */
+	double cursor_x = seat->cursor->x;
+	double cursor_y = seat->cursor->y;
+	wlr_output_layout_output_coords(seat->server->output_layout,
+		output->wlr_output, &cursor_x, &cursor_y);
+
+	struct wlr_box *area = &output->usable_area;
+	if (cursor_x <= area->x + snap_range) {
+		return VIEW_EDGE_LEFT;
+	} else if (cursor_x >= area->x + area->width - snap_range) {
+		return VIEW_EDGE_RIGHT;
+	} else if (cursor_y <= area->y + snap_range) {
+		if (rc.snap_top_maximize) {
+			return VIEW_EDGE_CENTER;
+		} else {
+			return VIEW_EDGE_UP;
+		}
+	} else if (cursor_y >= area->y + area->height - snap_range) {
+		return VIEW_EDGE_DOWN;
+	} else {
+		/* Not close to any edge */
+		return VIEW_EDGE_INVALID;
+	}
+}
+
 /* Returns true if view was snapped to any edge */
 static bool
 snap_to_edge(struct view *view)
 {
-	int snap_range = rc.snap_edge_range;
-	if (!snap_range) {
-		return false;
-	}
-
-	struct output *output = output_nearest_to_cursor(view->server);
-	if (!output_is_usable(output)) {
-		wlr_log(WLR_ERROR, "output at cursor is unusable");
-		return false;
-	}
-
-	/* Translate into output local coordinates */
-	double cursor_x = view->server->seat.cursor->x;
-	double cursor_y = view->server->seat.cursor->y;
-	wlr_output_layout_output_coords(view->server->output_layout,
-		output->wlr_output, &cursor_x, &cursor_y);
-
-	struct wlr_box *area = &output->usable_area;
-	enum view_edge edge;
-	if (cursor_x <= area->x + snap_range) {
-		edge = VIEW_EDGE_LEFT;
-	} else if (cursor_x >= area->x + area->width - snap_range) {
-		edge = VIEW_EDGE_RIGHT;
-	} else if (cursor_y <= area->y + snap_range) {
-		edge = VIEW_EDGE_UP;
-	} else if (cursor_y >= area->y + area->height - snap_range) {
-		edge = VIEW_EDGE_DOWN;
-	} else {
-		/* Not close to any edge */
+	struct output *output;
+	enum view_edge edge = edge_from_cursor(&view->server->seat, &output);
+	if (edge == VIEW_EDGE_INVALID) {
 		return false;
 	}
 
@@ -170,7 +184,8 @@ snap_to_edge(struct view *view)
 	 * Don't store natural geometry here (it was
 	 * stored already in interactive_begin())
 	 */
-	if (edge == VIEW_EDGE_UP && rc.snap_top_maximize) {
+	if (edge == VIEW_EDGE_CENTER) {
+		/* <topMaximize> */
 		view_maximize(view, VIEW_AXIS_BOTH,
 			/*store_natural_geometry*/ false);
 	} else {
@@ -226,7 +241,7 @@ interactive_cancel(struct view *view)
 		return;
 	}
 
-	regions_hide_overlay(&view->server->seat);
+	overlay_hide(&view->server->seat);
 
 	resize_indicator_hide(view);
 
diff --git a/src/meson.build b/src/meson.build
index a71eb06b..e08afb82 100644
--- a/src/meson.build
+++ b/src/meson.build
@@ -14,6 +14,7 @@ labwc_sources = files(
   'osd.c',
   'output.c',
   'output-virtual.c',
+  'overlay.c',
   'placement.c',
   'regions.c',
   'resistance.c',
diff --git a/src/overlay.c b/src/overlay.c
new file mode 100644
index 00000000..c9007e69
--- /dev/null
+++ b/src/overlay.c
@@ -0,0 +1,172 @@
+// SPDX-License-Identifier: GPL-2.0-only
+#include <assert.h>
+#include <wlr/render/pixman.h>
+#include "labwc.h"
+#include "overlay.h"
+#include "view.h"
+
+static void
+create_overlay(struct seat *seat)
+{
+	assert(!seat->overlay.tree);
+
+	struct server *server = seat->server;
+	struct wlr_scene_tree *parent = wlr_scene_tree_create(&server->scene->tree);
+
+	seat->overlay.tree = parent;
+	wlr_scene_node_set_enabled(&parent->node, false);
+	if (!wlr_renderer_is_pixman(server->renderer)) {
+		/* Hardware assisted rendering: Half transparent overlay */
+		float color[4] = { 0.25, 0.25, 0.35, 0.5 };
+		seat->overlay.rect = wlr_scene_rect_create(parent, 0, 0, color);
+	} else {
+		/* Software rendering: Outlines */
+		int line_width = server->theme->osd_border_width;
+		float *colors[3] = {
+			server->theme->osd_bg_color,
+			server->theme->osd_label_text_color,
+			server->theme->osd_bg_color
+		};
+		seat->overlay.pixman_rect = multi_rect_create(parent, colors, line_width);
+	}
+}
+
+static void
+cancel_pending_overlay(struct overlay *overlay)
+{
+	if (!overlay->timer) {
+		return;
+	}
+	wl_event_source_remove(overlay->timer);
+	overlay->timer = NULL;
+	overlay->view = NULL;
+	overlay->box = (struct wlr_box){0};
+}
+
+static void
+show_overlay(struct seat *seat, struct view *view, struct wlr_box *box)
+{
+	if (!seat->overlay.tree) {
+		create_overlay(seat);
+	}
+
+	/* Update overlay */
+	struct server *server = seat->server;
+	struct wlr_scene_node *node = &seat->overlay.tree->node;
+	if (!wlr_renderer_is_pixman(server->renderer)) {
+		/* Hardware assisted rendering: Half transparent overlay */
+		wlr_scene_rect_set_size(seat->overlay.rect,
+			box->width, box->height);
+	} else {
+		/* Software rendering: Outlines */
+		multi_rect_set_size(seat->overlay.pixman_rect,
+			box->width, box->height);
+	}
+	if (node->parent != view->scene_tree->node.parent) {
+		wlr_scene_node_reparent(node, view->scene_tree->node.parent);
+		wlr_scene_node_place_below(node, &view->scene_tree->node);
+	}
+	wlr_scene_node_set_position(node, box->x, box->y);
+	wlr_scene_node_set_enabled(node, true);
+
+	cancel_pending_overlay(&seat->overlay);
+}
+
+static int
+handle_overlay_timeout(void *data)
+{
+	struct seat *seat = data;
+	show_overlay(seat, seat->overlay.view, &seat->overlay.box);
+	return 0;
+}
+
+static void
+show_overlay_delayed(struct seat *seat, struct view *view, struct wlr_box *box)
+{
+	if (seat->overlay.timer
+			&& seat->overlay.view == view
+			&& wlr_box_equal(box, &seat->overlay.box)) {
+		return;
+	}
+	cancel_pending_overlay(&seat->overlay);
+	seat->overlay.view = view;
+	seat->overlay.box = *box;
+	seat->overlay.timer = wl_event_loop_add_timer(
+		seat->server->wl_event_loop,
+		handle_overlay_timeout, seat);
+	wl_event_source_timer_update(seat->overlay.timer, 150);
+}
+
+void
+overlay_show(struct seat *seat, struct view *view)
+{
+	struct server *server = seat->server;
+
+	/*
+	 * TODO: cache return value of regions_from_cursor() or
+	 * edge_from_cursor() to eliminate duplicated calls to show_overlay() /
+	 * show_overlay_delayed().
+	 */
+	if (regions_should_snap(server)) {
+		/* Region overlay */
+		struct region *region = regions_from_cursor(server);
+		if (region) {
+			show_overlay(seat, view, &region->geo);
+			return;
+		}
+	} else {
+		/* Snap-to-edge overlay */
+		struct output *output;
+		enum view_edge edge = edge_from_cursor(seat, &output);
+		if (edge != VIEW_EDGE_INVALID) {
+			/* TODO: share logic with view_get_edge_snap_box() */
+			struct wlr_box box =
+				output_usable_area_in_layout_coords(output);
+			switch (edge) {
+			case VIEW_EDGE_RIGHT:
+				box.x += box.width / 2;
+				/* fallthrough */
+			case VIEW_EDGE_LEFT:
+				box.width /= 2;
+				break;
+			case VIEW_EDGE_DOWN:
+				box.y += box.height / 2;
+				/* fallthrough */
+			case VIEW_EDGE_UP:
+				box.height /= 2;
+				break;
+			case VIEW_EDGE_CENTER:
+				/* <topMaximize> */
+				break;
+			case VIEW_EDGE_INVALID:
+				/* not reached */
+				assert(false);
+			}
+			/*
+			 * Delay showing overlay to prevent flickering when
+			 * dragging view across output edges in multi-monitor
+			 * setup
+			 */
+			show_overlay_delayed(seat, view, &box);
+			return;
+		}
+	}
+	overlay_hide(seat);
+}
+
+void
+overlay_hide(struct seat *seat)
+{
+	cancel_pending_overlay(&seat->overlay);
+
+	struct server *server = seat->server;
+	struct wlr_scene_node *node = &seat->overlay.tree->node;
+	if (!node) {
+		return;
+	}
+
+	wlr_scene_node_set_enabled(node, false);
+	if (node->parent != &server->scene->tree) {
+		wlr_scene_node_reparent(node, &server->scene->tree);
+	}
+}
diff --git a/src/regions.c b/src/regions.c
index f6eb6174..3add5870 100644
--- a/src/regions.c
+++ b/src/regions.c
@@ -5,11 +5,9 @@
 #include <float.h>
 #include <math.h>
 #include <string.h>
-#include <wlr/render/pixman.h>
 #include <wlr/types/wlr_scene.h>
 #include <wlr/util/box.h>
 #include <wlr/util/log.h>
-#include "common/graphic-helpers.h"
 #include "common/list.h"
 #include "common/mem.h"
 #include "input/keyboard.h"
@@ -30,32 +28,6 @@ regions_should_snap(struct server *server)
 	return keyboard_any_modifiers_pressed(keyboard);
 }
 
-static void
-overlay_create(struct seat *seat)
-{
-	assert(!seat->region_overlay.tree);
-
-	struct server *server = seat->server;
-	struct wlr_scene_tree *parent = wlr_scene_tree_create(&server->scene->tree);
-
-	seat->region_overlay.tree = parent;
-	wlr_scene_node_set_enabled(&parent->node, false);
-	if (!wlr_renderer_is_pixman(server->renderer)) {
-		/* Hardware assisted rendering: Half transparent overlay */
-		float color[4] = { 0.25, 0.25, 0.35, 0.5 };
-		seat->region_overlay.overlay = wlr_scene_rect_create(parent, 0, 0, color);
-	} else {
-		/* Software rendering: Outlines */
-		int line_width = server->theme->osd_border_width;
-		float *colors[3] = {
-			server->theme->osd_bg_color,
-			server->theme->osd_label_text_color,
-			server->theme->osd_bg_color
-		};
-		seat->region_overlay.pixman_overlay = multi_rect_create(parent, colors, line_width);
-	}
-}
-
 struct region *
 regions_from_name(const char *region_name, struct output *output)
 {
@@ -101,61 +73,6 @@ regions_from_cursor(struct server *server)
 	return closest_region;
 }
 
-void
-regions_show_overlay(struct view *view, struct seat *seat, struct region *region)
-{
-	assert(view);
-	assert(seat);
-	assert(region);
-
-	/* Don't show active region */
-	if (seat->region_active == region) {
-		return;
-	}
-
-	if (!seat->region_overlay.tree) {
-		overlay_create(seat);
-	}
-
-	/* Update overlay */
-	struct server *server = seat->server;
-	struct wlr_scene_node *node = &seat->region_overlay.tree->node;
-	if (!wlr_renderer_is_pixman(server->renderer)) {
-		/* Hardware assisted rendering: Half transparent overlay */
-		wlr_scene_rect_set_size(seat->region_overlay.overlay,
-			region->geo.width, region->geo.height);
-	} else {
-		/* Software rendering: Outlines */
-		multi_rect_set_size(seat->region_overlay.pixman_overlay,
-			region->geo.width, region->geo.height);
-	}
-	if (node->parent != view->scene_tree->node.parent) {
-		wlr_scene_node_reparent(node, view->scene_tree->node.parent);
-		wlr_scene_node_place_below(node, &view->scene_tree->node);
-	}
-	wlr_scene_node_set_position(node, region->geo.x, region->geo.y);
-	wlr_scene_node_set_enabled(node, true);
-	seat->region_active = region;
-}
-
-void
-regions_hide_overlay(struct seat *seat)
-{
-	assert(seat);
-	if (!seat->region_active) {
-		return;
-	}
-
-	struct server *server = seat->server;
-	struct wlr_scene_node *node = &seat->region_overlay.tree->node;
-
-	wlr_scene_node_set_enabled(node, false);
-	if (node->parent != &server->scene->tree) {
-		wlr_scene_node_reparent(node, &server->scene->tree);
-	}
-	seat->region_active = NULL;
-}
-
 void
 regions_reconfigure_output(struct output *output)
 {
@@ -247,9 +164,6 @@ regions_destroy(struct seat *seat, struct wl_list *regions)
 	wl_list_for_each_safe(region, region_tmp, regions, link) {
 		wl_list_remove(&region->link);
 		zfree(region->name);
-		if (seat && seat->region_active == region) {
-			seat->region_active = NULL;
-		}
 		zfree(region);
 	}
 }
diff --git a/src/view.c b/src/view.c
index 066b8427..6e8a7769 100644
--- a/src/view.c
+++ b/src/view.c
@@ -2223,7 +2223,7 @@ view_destroy(struct view *view)
 		/* Application got killed while moving around */
 		server->input_mode = LAB_INPUT_STATE_PASSTHROUGH;
 		server->grabbed_view = NULL;
-		regions_hide_overlay(&server->seat);
+		overlay_hide(&server->seat);
 	}
 
 	if (server->active_view == view) {