diff -r 7cc4263e07a9 -r 6c375e07d673 mercurial/localrepo.py
--- a/mercurial/localrepo.py	Wed Nov 24 15:38:52 2010 -0600
+++ b/mercurial/localrepo.py	Wed Nov 24 15:56:32 2010 -0600
@@ -105,7 +105,7 @@
         self._tags = None
         self._tagtypes = None
 
-        self._branchcache = None  # in UTF-8
+        self._branchcache = None
         self._branchcachetip = None
         self.nodetagscache = None
         self.filterpats = {}
@@ -435,7 +435,6 @@
             bt[bn] = tip
         return bt
 
-
     def _readbranchcache(self):
         partial = {}
         try:
@@ -455,7 +454,8 @@
                 if not l:
                     continue
                 node, label = l.split(" ", 1)
-                partial.setdefault(label.strip(), []).append(bin(node))
+                label = encoding.tolocal(label.strip())
+                partial.setdefault(label, []).append(bin(node))
         except KeyboardInterrupt:
             raise
         except Exception, inst:
@@ -470,7 +470,7 @@
             f.write("%s %s\n" % (hex(tip), tiprev))
             for label, nodes in branches.iteritems():
                 for node in nodes:
-                    f.write("%s %s\n" % (hex(node), label))
+                    f.write("%s %s\n" % (hex(node), encoding.fromlocal(label)))
             f.rename()
         except (IOError, OSError):
             pass
@@ -659,7 +659,8 @@
         except IOError:
             ds = ""
         self.opener("journal.dirstate", "w").write(ds)
-        self.opener("journal.branch", "w").write(self.dirstate.branch())
+        self.opener("journal.branch", "w").write(
+            encoding.fromlocal(self.dirstate.branch()))
         self.opener("journal.desc", "w").write("%d\n%s\n" % (len(self), desc))
 
         renames = [(self.sjoin("journal"), self.sjoin("undo")),
@@ -717,7 +718,7 @@
                 except IOError:
                     self.ui.warn(_("Named branch could not be reset, "
                                    "current branch still is: %s\n")
-                                 % encoding.tolocal(self.dirstate.branch()))
+                                 % self.dirstate.branch())
                 self.invalidate()
                 self.dirstate.invalidate()
                 self.destroyed()