diff --git a/railties/CHANGELOG b/railties/CHANGELOG
index eed9a4e4b19e855bb66dc315df3c2a0b555dd4ca..ced871f3b1584c096ab464f9bad463370ff79102 100644
--- a/railties/CHANGELOG
+++ b/railties/CHANGELOG
@@ -1,5 +1,7 @@
 *SVN*
 
+* If specified, pass PostgreSQL client character encoding to createdb.  #2703 [Kazuhiko <kazuhiko@fdiary.net>]
+
 * Catch CGI multipart parse errors.  Wrap dispatcher internals in a failsafe response handler.  [Jeremy Kemper]
 
 * The freeze_gems Rake task accepts the VERSION environment variable to decide which version of Rails to pull into vendor/rails.  [Chad Fowler, Jeremy Kemper]
diff --git a/railties/lib/tasks/databases.rake b/railties/lib/tasks/databases.rake
index 97c07f97f9d1d03eb265d5361cb7896c4276d642..c9a081502e7ed5a08f77650d950b9d83a79c796b 100644
--- a/railties/lib/tasks/databases.rake
+++ b/railties/lib/tasks/databases.rake
@@ -101,8 +101,9 @@ task :purge_test_database => :environment do
       ENV['PGHOST']     = abcs["test"]["host"] if abcs["test"]["host"]
       ENV['PGPORT']     = abcs["test"]["port"].to_s if abcs["test"]["port"]
       ENV['PGPASSWORD'] = abcs["test"]["password"].to_s if abcs["test"]["password"]
+      enc_option = "-E #{abcs["test"]["encoding"]}" if abcs["test"]["encoding"]
       `dropdb -U "#{abcs["test"]["username"]}" #{abcs["test"]["database"]}`
-      `createdb -T template0 -U "#{abcs["test"]["username"]}" #{abcs["test"]["database"]}`
+      `createdb #{enc_option} -T template0 -U "#{abcs["test"]["username"]}" #{abcs["test"]["database"]}`
     when "sqlite","sqlite3"
       File.delete(abcs["test"]["dbfile"]) if File.exist?(abcs["test"]["dbfile"])
     when "sqlserver"