diff --git a/CHANGES b/CHANGES
index e8d72d06d..3077ee31c 100644
--- a/CHANGES
+++ b/CHANGES
@@ -33,6 +33,9 @@ Bugs fixed
 * #933: Do not crash if an ``:option:`` value is malformed (contains spaces
   but no option name).
 
+* #908: On Python 3, handle error messages from LaTeX correctly in the pngmath
+  extension.
+
 Documentation
 -------------
 
diff --git a/sphinx/ext/pngmath.py b/sphinx/ext/pngmath.py
index 3938dab17..a9a2203ac 100644
--- a/sphinx/ext/pngmath.py
+++ b/sphinx/ext/pngmath.py
@@ -26,7 +26,7 @@ from docutils import nodes
 from sphinx.errors import SphinxError
 from sphinx.util.png import read_png_depth, write_png_depth
 from sphinx.util.osutil import ensuredir, ENOENT
-from sphinx.util.pycompat import b
+from sphinx.util.pycompat import b, sys_encoding
 from sphinx.ext.mathbase import setup_math as mathbase_setup, wrap_displaymath
 
 class MathExtError(SphinxError):
@@ -34,9 +34,9 @@ class MathExtError(SphinxError):
 
     def __init__(self, msg, stderr=None, stdout=None):
         if stderr:
-            msg += '\n[stderr]\n' + stderr
+            msg += '\n[stderr]\n' + stderr.decode(sys_encoding, 'replace')
         if stdout:
-            msg += '\n[stdout]\n' + stdout
+            msg += '\n[stdout]\n' + stdout.decode(sys_encoding, 'replace')
         SphinxError.__init__(self, msg)
 
 
@@ -192,11 +192,11 @@ def html_visit_math(self, node):
     try:
         fname, depth = render_math(self, '$'+node['latex']+'$')
     except MathExtError, exc:
-        msg = unicode(str(exc), 'utf-8', 'replace')
+        msg = unicode(exc)
         sm = nodes.system_message(msg, type='WARNING', level=2,
                                   backrefs=[], source=node['latex'])
         sm.walkabout(self)
-        self.builder.warn('display latex %r: ' % node['latex'] + str(exc))
+        self.builder.warn('display latex %r: ' % node['latex'] + msg)
         raise nodes.SkipNode
     if fname is None:
         # something failed -- use text-only as a bad substitute
diff --git a/sphinx/util/pycompat.py b/sphinx/util/pycompat.py
index 3d252c917..1e5ea3145 100644
--- a/sphinx/util/pycompat.py
+++ b/sphinx/util/pycompat.py
@@ -30,6 +30,9 @@ if sys.version_info >= (3, 0):
     # safely encode a string for printing to the terminal
     def terminal_safe(s):
         return s.encode('ascii', 'backslashreplace').decode('ascii')
+    # some kind of default system encoding; should be used with a lenient
+    # error handler
+    sys_encoding = sys.getdefaultencoding()
     # support for running 2to3 over config files
     def convert_with_2to3(filepath):
         from lib2to3.refactor import RefactoringTool, get_fixers_from_package
@@ -62,6 +65,10 @@ else:
     # safely encode a string for printing to the terminal
     def terminal_safe(s):
         return s.encode('ascii', 'backslashreplace')
+    # some kind of default system encoding; should be used with a lenient
+    # error handler
+    import locale
+    sys_encoding = locale.getpreferredencoding()
 
 
 def execfile_(filepath, _globals):