diff --git a/contrib/chg/chg.c b/contrib/chg/chg.c
--- a/contrib/chg/chg.c
+++ b/contrib/chg/chg.c
@@ -203,6 +203,39 @@
 	return hgcmd;
 }
 
+static void putsidechannelenv(const char *envname)
+{
+	char *buf, *bufp;
+	const char *existing_val = getenv(envname);
+	size_t existing_val_len = 0;
+	size_t envname_len = strlen(envname);
+	size_t buf_len;
+
+	if (existing_val != NULL) {
+		existing_val_len = strlen(existing_val);
+	}
+
+        /* 11: 8 for CHGORIG_, 1 for the =, 1 for the "exists" flag, 1 for the
+         * nul */
+	buf_len = envname_len + existing_val_len + 11;
+	bufp = buf = mallocx(buf_len);
+	strlcpy(bufp, "CHGORIG_", 8);
+	bufp += 8;  /* strlen("CHGORIG_") */
+	strlcpy(bufp, envname, envname_len);
+	bufp += envname_len;
+	*bufp++ = '=';
+	*bufp++ = (existing_val == NULL) ? '0' : '1';
+	if (existing_val != NULL && existing_val_len > 0) {
+		strlcpy(bufp, existing_val, existing_val_len);
+		bufp += existing_val_len;
+	}
+	*bufp = '\0';
+	if (putenv(buf) != 0) {
+		abortmsgerrno("failed to putenv for stored vars");
+        }
+        /* don't free `buf`, putenv does NOT copy the string! */
+}
+
 static void execcmdserver(const struct cmdserveropts *opts)
 {
 	const char *hgcmd = gethgcmd();
@@ -410,6 +443,14 @@
 		         "wrapper to chg. Alternatively, set $CHGHG to the "
 		         "path of real hg.");
 
+	char *coerce = getenv("PYTHONCOERCECLOCALE");
+	if (coerce == NULL || coerce[0] != '0') {
+		/* Py3 modifies the environment on execution, we need a side
+		 * channel to get an unmodified environment to `hg serve` for
+		 * some variables */
+		putsidechannelenv("LC_CTYPE");
+	}
+
 	if (isunsupported(argc - 1, argv + 1))
 		execoriginalhg(argv);