Index: django/newforms/util.py
===================================================================
--- django/newforms/util.py	(revision 4557)
+++ django/newforms/util.py	(working copy)
@@ -10,7 +10,7 @@
         if hasattr(s, '__unicode__'):
             s = unicode(s)
         else:
-            s = unicode(str(s), settings.DEFAULT_CHARSET)
+            s = unicode(str(s).decode(settings.DEFAULT_CHARSET), settings.DEFAULT_CHARSET)
     elif not isinstance(s, unicode):
         s = unicode(s, settings.DEFAULT_CHARSET)
     return s