Attached reduced test case works fine with Python 3.1, fails with Python3.2: SyntaxError: Non-ASCII character '\xc3' in file D:\my\py\t32enc.py on line 1, but no encoding declared; see http://www.python.org/peps/pep-0263.html for details I'm familiar with the PEP, but thought 3.x cured that. Python 3.1 produces no error; I'm not sure that 3.2 did or didn't report such problems, or if the programs I ran with 3.2 simply didn't contain non-ASCII characters. The file is UTF-8 encoded with no pseudo-BOM. Is this intentional, or a regression (in which case I will open a ticket)? If a regression, does that mean we have no tests for it, possibly because most of the tests contain the PEP 263 encoding directive, because most people using 3.x are still also using 2.x (I am not)?