diff --git a/mercurial/dirstate.py b/mercurial/dirstate.py
--- a/mercurial/dirstate.py
+++ b/mercurial/dirstate.py
@@ -448,6 +448,7 @@
         size=None,
         mtime=None,
         added=False,
+        merged=False,
         from_p2=False,
         possibly_dirty=False,
     ):
@@ -476,6 +477,7 @@
             size=size,
             mtime=mtime,
             added=added,
+            merged=merged,
             from_p2=from_p2,
             possibly_dirty=possibly_dirty,
         )
@@ -538,7 +540,7 @@
             raise error.Abort(msg)
         if f in self and self[f] == b'n':
             # merge-like
-            self._addpath(f, b'm', 0, from_p2=True)
+            self._addpath(f, merged=True)
         else:
             # add-like
             self._addpath(f, b'n', 0, from_p2=True)
diff --git a/mercurial/dirstatemap.py b/mercurial/dirstatemap.py
--- a/mercurial/dirstatemap.py
+++ b/mercurial/dirstatemap.py
@@ -152,16 +152,24 @@
         size=None,
         mtime=None,
         added=False,
+        merged=False,
         from_p2=False,
         possibly_dirty=False,
     ):
         """Add a tracked file to the dirstate."""
         if added:
+            assert not merged
             assert not possibly_dirty
             assert not from_p2
             state = b'a'
             size = NONNORMAL
             mtime = AMBIGUOUS_TIME
+        elif merged:
+            assert not possibly_dirty
+            assert not from_p2
+            state = b'm'
+            size = FROM_P2
+            mtime = AMBIGUOUS_TIME
         elif from_p2:
             assert not possibly_dirty
             size = FROM_P2
@@ -470,6 +478,7 @@
             size=None,
             mtime=None,
             added=False,
+            merged=False,
             from_p2=False,
             possibly_dirty=False,
         ):
@@ -480,6 +489,7 @@
                 size,
                 mtime,
                 added,
+                merged,
                 from_p2,
                 possibly_dirty,
             )
diff --git a/rust/hg-core/src/dirstate/dirstate_map.rs b/rust/hg-core/src/dirstate/dirstate_map.rs
--- a/rust/hg-core/src/dirstate/dirstate_map.rs
+++ b/rust/hg-core/src/dirstate/dirstate_map.rs
@@ -71,16 +71,24 @@
         entry: DirstateEntry,
         // XXX once the dust settle this should probably become an enum
         added: bool,
+        merged: bool,
         from_p2: bool,
         possibly_dirty: bool,
     ) -> Result<(), DirstateError> {
         let mut entry = entry;
         if added {
+            assert!(!merged);
             assert!(!possibly_dirty);
             assert!(!from_p2);
             entry.state = EntryState::Added;
             entry.size = SIZE_NON_NORMAL;
             entry.mtime = MTIME_UNSET;
+        } else if merged {
+            assert!(!possibly_dirty);
+            assert!(!from_p2);
+            entry.state = EntryState::Merged;
+            entry.size = SIZE_FROM_OTHER_PARENT;
+            entry.mtime = MTIME_UNSET;
         } else if from_p2 {
             assert!(!possibly_dirty);
             entry.size = SIZE_FROM_OTHER_PARENT;
@@ -410,6 +418,7 @@
             false,
             false,
             false,
+            false,
         )
         .unwrap();
 
diff --git a/rust/hg-core/src/dirstate_tree/dirstate_map.rs b/rust/hg-core/src/dirstate_tree/dirstate_map.rs
--- a/rust/hg-core/src/dirstate_tree/dirstate_map.rs
+++ b/rust/hg-core/src/dirstate_tree/dirstate_map.rs
@@ -723,6 +723,7 @@
         filename: &HgPath,
         entry: DirstateEntry,
         added: bool,
+        merged: bool,
         from_p2: bool,
         possibly_dirty: bool,
     ) -> Result<(), DirstateError> {
@@ -733,6 +734,12 @@
             entry.state = EntryState::Added;
             entry.size = SIZE_NON_NORMAL;
             entry.mtime = MTIME_UNSET;
+        } else if merged {
+            assert!(!possibly_dirty);
+            assert!(!from_p2);
+            entry.state = EntryState::Merged;
+            entry.size = SIZE_FROM_OTHER_PARENT;
+            entry.mtime = MTIME_UNSET;
         } else if from_p2 {
             assert!(!possibly_dirty);
             entry.size = SIZE_FROM_OTHER_PARENT;
diff --git a/rust/hg-core/src/dirstate_tree/dispatch.rs b/rust/hg-core/src/dirstate_tree/dispatch.rs
--- a/rust/hg-core/src/dirstate_tree/dispatch.rs
+++ b/rust/hg-core/src/dirstate_tree/dispatch.rs
@@ -49,6 +49,7 @@
         filename: &HgPath,
         entry: DirstateEntry,
         added: bool,
+        merged: bool,
         from_p2: bool,
         possibly_dirty: bool,
     ) -> Result<(), DirstateError>;
@@ -289,10 +290,11 @@
         filename: &HgPath,
         entry: DirstateEntry,
         added: bool,
+        merged: bool,
         from_p2: bool,
         possibly_dirty: bool,
     ) -> Result<(), DirstateError> {
-        self.add_file(filename, entry, added, from_p2, possibly_dirty)
+        self.add_file(filename, entry, added, merged, from_p2, possibly_dirty)
     }
 
     fn remove_file(
diff --git a/rust/hg-cpython/src/dirstate/dirstate_map.rs b/rust/hg-cpython/src/dirstate/dirstate_map.rs
--- a/rust/hg-cpython/src/dirstate/dirstate_map.rs
+++ b/rust/hg-cpython/src/dirstate/dirstate_map.rs
@@ -113,6 +113,7 @@
         size: PyObject,
         mtime: PyObject,
         added: PyObject,
+        merged: PyObject,
         from_p2: PyObject,
         possibly_dirty: PyObject,
     ) -> PyResult<PyObject> {
@@ -153,12 +154,14 @@
             mtime: mtime,
         };
         let added = added.extract::<PyBool>(py)?.is_true();
+        let merged = merged.extract::<PyBool>(py)?.is_true();
         let from_p2 = from_p2.extract::<PyBool>(py)?.is_true();
         let possibly_dirty = possibly_dirty.extract::<PyBool>(py)?.is_true();
         self.inner(py).borrow_mut().add_file(
             filename,
             entry,
             added,
+            merged,
             from_p2,
             possibly_dirty
         ).and(Ok(py.None())).or_else(|e: DirstateError| {
diff --git a/rust/hg-cpython/src/dirstate/dispatch.rs b/rust/hg-cpython/src/dirstate/dispatch.rs
--- a/rust/hg-cpython/src/dirstate/dispatch.rs
+++ b/rust/hg-cpython/src/dirstate/dispatch.rs
@@ -26,6 +26,7 @@
         filename: &HgPath,
         entry: DirstateEntry,
         added: bool,
+        merged: bool,
         from_p2: bool,
         possibly_dirty: bool,
     ) -> Result<(), DirstateError> {
@@ -33,6 +34,7 @@
             filename,
             entry,
             added,
+            merged,
             from_p2,
             possibly_dirty,
         )