diff --git a/setup.py b/setup.py
--- a/setup.py
+++ b/setup.py
@@ -136,6 +136,18 @@
 from distutils.sysconfig import get_python_inc, get_config_var
 from distutils.version import StrictVersion
 
+def write_if_changed(path, content):
+    """Write content to a file iff the content hasn't changed."""
+    if os.path.exists(path):
+        with open(path, 'rb') as fh:
+            current = fh.read()
+    else:
+        current = b''
+
+    if current != content:
+        with open(path, 'wb') as fh:
+            fh.write(content)
+
 scripts = ['hg']
 if os.name == 'nt':
     # We remove hg.bat if we are able to build hg.exe.
@@ -317,9 +329,14 @@
         version = kw.get('node', '')[:12]
 
 if version:
-    with open("mercurial/__version__.py", "w") as f:
-        f.write('# this file is autogenerated by setup.py\n')
-        f.write('version = "%s"\n' % version)
+    versionb = version
+    if not isinstance(versionb, bytes):
+        versionb = versionb.encode('ascii')
+
+    write_if_changed('mercurial/__version__.py', b''.join([
+        b'# this file is autogenerated by setup.py\n'
+        b'version = "%s"\n' % versionb,
+    ]))
 
 try:
     oldpolicy = os.environ.get('HGMODULEPOLICY', None)
@@ -478,9 +495,13 @@
             modulepolicy = 'allow'
         else:
             modulepolicy = 'c'
-        with open(os.path.join(basepath, '__modulepolicy__.py'), "w") as f:
-            f.write('# this file is autogenerated by setup.py\n')
-            f.write('modulepolicy = b"%s"\n' % modulepolicy)
+
+        content = b''.join([
+            b'# this file is autogenerated by setup.py\n',
+            b'modulepolicy = b"%s"\n' % modulepolicy.encode('ascii'),
+        ])
+        write_if_changed(os.path.join(basepath, '__modulepolicy__.py'),
+                         content)
 
         build_py.run(self)