diff --git a/mercurial/dispatch.py b/mercurial/dispatch.py
--- a/mercurial/dispatch.py
+++ b/mercurial/dispatch.py
@@ -96,6 +96,9 @@
 
 def _enabledemandimport():
     """enable importing on demand to reduce startup time"""
+    if 'CHGINTERNALMARK' in encoding.environ:
+        # do not enable demandimport for chgserver
+        return
     if sys.version_info[0] < 3 or sys.version_info >= (3, 6):
         demandimport.enable()