We consider the problem of signal design for transmission over an interference channel, along the lines of the recently proposed strategy of Interference Alignment. In the framework of interference alignment, each receiver maintains an interference subspace. The transmitters shape their transmissions such that all the interference seen at a particular receiver falls into its interference subspace, hence allowing the remaining receiver space to be used for reception of the useful signal. In contrast to previously proposed iterative interference alignment algorithms for the general interference channel, our proposed technique not only minimizes the interference power that is spilled outside the interference subspace, but also minimizes the signal power that is spilled over into the interference subspace. A weighted optimization technique is proposed to tradeoff between the relative importance associated with the leakage interference and the leakage signal powers. It is proven that the algorithm converges monotonically, and simulation results reveal that the proposed technique outperforms other known algorithms in terms of throughput. Further discussions on generalizing the algorithm are also presented.