diff --git a/Lib/distutils/log.py b/Lib/distutils/log.py
index 7588570..b301a83 100644
--- a/Lib/distutils/log.py
+++ b/Lib/distutils/log.py
@@ -27,6 +27,10 @@
                 stream = sys.stderr
             else:
                 stream = sys.stdout
+            if stream.errors == 'strict':
+                # emulate backslashreplace error handler
+                encoding = stream.encoding
+                msg = msg.encode(encoding, "backslashreplace").decode(encoding)
             stream.write('%s\n' % msg)
             stream.flush()
 
diff --git a/Misc/NEWS b/Misc/NEWS
index ceda9b7..3e582cd 100644
--- a/Misc/NEWS
+++ b/Misc/NEWS
@@ -370,6 +370,10 @@
 Library
 -------
 
+- Issue #8663: distutils.log emulates backslashreplace error handler. Fix
+  compilation in a non-ASCII directory if stdout encoding is ASCII (eg. if
+  stdout is not a TTY).
+
 - Issue #8513: os.get_exec_path() supports b'PATH' key and bytes value.
   subprocess.Popen() and os._execvpe() support bytes program name. Add
   os.supports_bytes_environ flag: True if the native OS type of the environment