A canvas element with some JavaScript would work great.
In fact, Signature Pad (a jQuery plugin) already has this implemented.
Here is a quickly hacked up version of this using SVG I just did. Works well for me on my iPhone. Also works in a desktop browser using normal mouse events.
The options already listed are very good, however here a few more on this topic that I've researched and came across.
1) http://perfectionkills.com/exploring-canvas-drawing-techniques/
2) http://mcc.id.au/2010/signature.html
3) https://zipso.net/a-simple-touchscreen-sketchpad-using-javascript-and-html5/
And as always you may want to save the canvas to image:
http://www.html5canvastutorials.com/advanced/html5-canvas-save-drawing-as-an-image/
good luck and happy signing
Another OpenSource signature field is https://github.com/applicius/jquery.signfield/ , registered jQuery plugin using Sketch.js .
Perhaps the best two browser techs for this are Canvas, with Flash as a back up.
We tried VML on IE as backup for Canvas, but it was much slower than Flash. SVG was slower then all the rest.
With jSignature ( http://willowsystems.github.com/jSignature/ ) we used Canvas as primary, with fallback to Flash-based Canvas emulator (FlashCanvas) for IE8 and less. Id' say worked very well for us.
Source: Stackoverflow.com