No, Mercurial still does not support file name conversion. That is, it will check the file names as binary strings, and you will run into problems if you need to move files between systems with incompatible file name encodings.
If everyone on your team uses Windows with the same code page, you can use non-ASCII characters just fine. They will be stored inside the repository on any code page that you use, but everyone will be able to use the files.
If you need to transfer files between platforms, for now, stick to ASCII file names.
There is a Windows UTF-8 plan in the work, and FUJIWARA Katsunori is working on it , but it is not yet (September 2012) ready.
Martin geisler
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