diff --git a/development.ini b/development.ini
--- a/development.ini
+++ b/development.ini
@@ -160,6 +160,9 @@ api_access_controllers_whitelist =
 ## can be also a comma separated list of encoding in case of mixed encodings
 default_encoding = utf8
 
+## Set Mercurial encoding, similar to setting HGENCODING before launching Kallithea
+hgencoding = utf-8
+
 ## issue tracker for Kallithea (leave blank to disable, absent for default)
 #bugtracker = https://bitbucket.org/conservancy/kallithea/issues