diff --git a/Lib/test/test_pep263.py b/Lib/test/test_pep263.py
index b7bb5a2..e4faa9f 100644
--- a/Lib/test/test_pep263.py
+++ b/Lib/test/test_pep263.py
@@ -23,6 +23,13 @@
         self.assertEqual(d['u'], u'\xf3')
 
 
+    def test_issue3297(self):
+        c = compile("a, b = '\U0001010F', '\\U0001010F'", "dummy", "exec")
+        d = {}
+        exec(c, d)
+        self.assertEqual(d['a'], d['b'])
+        self.assertEqual(len(d['a']), len(d['b']))
+
 def test_main():
     test_support.run_unittest(PEP263Test)
 
diff --git a/Python/ast.c b/Python/ast.c
index 347da2a..7f379a5 100644
--- a/Python/ast.c
+++ b/Python/ast.c
@@ -3289,10 +3289,11 @@
                 u = NULL;
         } else {
                 /* check for integer overflow */
-                if (len > PY_SIZE_MAX / 4)
+                if (len > PY_SIZE_MAX / 6)
                         return NULL;
-                /* "\XX" may become "\u005c\uHHLL" (12 bytes) */
-                u = PyString_FromStringAndSize((char *)NULL, len * 4);
+		/* "<C3><A4>" (2 bytes) may become "\U000000E4" (10 bytes), or 1:5
+		   "\ä" (3 bytes) may become "\u005c\U000000E4" (16 bytes), or ~1:6 */
+                u = PyString_FromStringAndSize((char *)NULL, len * 6);
                 if (u == NULL)
                         return NULL;
                 p = buf = PyString_AsString(u);
@@ -3309,19 +3310,21 @@
                                 PyObject *w;
                                 char *r;
                                 Py_ssize_t rn, i;
-                                w = decode_utf8(c, &s, end, "utf-16-be");
+                                w = decode_utf8(c, &s, end, "utf-32-be");
                                 if (w == NULL) {
                                         Py_DECREF(u);
                                         return NULL;
                                 }
                                 r = PyString_AsString(w);
                                 rn = PyString_Size(w);
-                                assert(rn % 2 == 0);
-                                for (i = 0; i < rn; i += 2) {
-                                        sprintf(p, "\\u%02x%02x",
+                                assert(rn % 4 == 0);
+                                for (i = 0; i < rn; i += 4) {
+                                        sprintf(p, "\\U%02x%02x%02x%02x",
                                                 r[i + 0] & 0xFF,
-                                                r[i + 1] & 0xFF);
-                                        p += 6;
+                                                r[i + 1] & 0xFF,
+						r[i + 2] & 0xFF,
+						r[i + 3] & 0xFF);
+                                        p += 10;
                                 }
                                 Py_DECREF(w);
                         } else {