diff --git a/test/test_execution.py b/test/test_execution.py
index 60df187de..f31e51558 100644
--- a/test/test_execution.py
+++ b/test/test_execution.py
@@ -1,4 +1,6 @@
 #!/usr/bin/env python
+# coding: utf-8
+
 from __future__ import unicode_literals
 
 import unittest
@@ -27,5 +29,12 @@ def test_module_exec(self):
     def test_main_exec(self):
         subprocess.check_call([sys.executable, 'youtube_dl/__main__.py', '--version'], cwd=rootDir, stdout=_DEV_NULL)
 
+    def test_cmdline_umlauts(self):
+        p = subprocess.Popen(
+            [sys.executable, 'youtube_dl/__main__.py', 'ä', '--version'],
+            cwd=rootDir, stdout=_DEV_NULL, stderr=subprocess.PIPE)
+        _, stderr = p.communicate()
+        self.assertFalse(stderr)
+
 if __name__ == '__main__':
     unittest.main()
diff --git a/youtube_dl/options.py b/youtube_dl/options.py
index 4e6e47d6f..35c7e5fb3 100644
--- a/youtube_dl/options.py
+++ b/youtube_dl/options.py
@@ -794,6 +794,11 @@ def _hide_login_info(opts):
             write_string('[debug] Override config: ' + repr(overrideArguments) + '\n')
     else:
         command_line_conf = sys.argv[1:]
+        # Workaround for Python 2.x, where argv is a byte list
+        if sys.version_info < (3,):
+            command_line_conf = [
+                a.decode('utf-8', 'replace') for a in command_line_conf]
+
         if '--ignore-config' in command_line_conf:
             system_conf = []
             user_conf = []