Echolocation signals of horseshoe bats (Rhinolophidae) consist of a relatively long component of constant frequency (CF) which is preceded by an initial frequency-modulated (iFM) component and followed by a terminal frequency-modulated (tFM) component. To examine the role of these components in echolocation, four bats were trained to fly from a perch to a landing bar. A dual camera system allowed reconstruction of the flight paths in three dimensions. Echolocation signals were recorded, analyzed, and correlated with the flight behavior of the bats. It was confirmed that during flight the bats compensate the Doppler shifts which are produced by their own flight movement. In free flight they emit per wing beat one single signal of long duration, with little variation in the three signal components. In approach flight the bats reduce pulse duration and interval with decreasing target range. The iFM is not varied with respect to target range, suggesting that this component plays little role in the processing of echolocating a target of interest. The bandwidth of the tFM component is increased while its duration is shortened in proportion to decreasing target range, so that the signal-echo overlap of the FM component is avoided down to a target distance of 15 cm. These concurrent changes suggest that the tFM component is used for ranging. During the last 60 cm of the approach the bats compensated for the increase of echo SPL by lowering the emission level of the CF component by 6-9 dB and that of the tFM component by 9-11 dB per halving of range. The specific signal structure of horseshoe bats is discussed as an adaptation for the hunting of fluttering insects in highly cluttered environments.