The bunching system of the ATLAS positive ion injector (PII) has been improved by relocating the harmonic buncher to a point significantly closer to the second stage sine-wave buncher and the injector LINAC. The longitudinal optics design has also been modified and now employs a virtual waist from the harmonic buncher feeding the second stage sine-wave buncher. This geometry improves the handling of space charge for high-current beams, significantly increases the capture fraction into the primary rf bucket and reduces the capture fraction of the unwanted parasitic rf bucket. Total capture and transport through the PII has been demonstrated as high as 80% of the injected dc beam while the population of the parasitic, unwanted rf bucket is typically less than 3% of the total transported beam. To remove this small residual parasitic component a new traveling-wave transmission-line chopper has been developed reducing both transverse and longitudinal emittance growth from the chopping process. This work was supported by the U.S. Department of Energy under contract W-31-109-ENG-38.