diff --git a/IPython/kernel/tests/test_kernel.py b/IPython/kernel/tests/test_kernel.py
index 1f1096b..5c3272f 100644
--- a/IPython/kernel/tests/test_kernel.py
+++ b/IPython/kernel/tests/test_kernel.py
@@ -1,3 +1,4 @@
+# coding: utf-8
 """test the IPython Kernel"""
 
 #-------------------------------------------------------------------------------
@@ -11,6 +12,8 @@
 # Imports
 #-------------------------------------------------------------------------------
 
+import io
+import os.path
 import sys
 
 import nose.tools as nt
@@ -18,8 +21,10 @@ import nose.tools as nt
 from IPython.testing import decorators as dec, tools as tt
 from IPython.utils import py3compat
 from IPython.utils.path import locate_profile
+from IPython.utils.tempdir import TemporaryDirectory
 
-from .utils import new_kernel, kernel, TIMEOUT, assemble_output, execute, flush_channels
+from .utils import (new_kernel, kernel, TIMEOUT, assemble_output, execute,
+                    flush_channels, wait_for_idle)
 
 #-------------------------------------------------------------------------------
 # Tests
@@ -180,6 +185,22 @@ def test_eval_input():
         nt.assert_equal(stdout, "2\n")
 
 
+def test_save_history():
+    # Saving history from the kernel with %hist -f was failing because of
+    # unicode problems on Python 2.
+    with kernel() as kc, TemporaryDirectory() as td:
+        file = os.path.join(td, 'hist.out')
+        execute(u'a=1', kc=kc)
+        wait_for_idle(kc)
+        execute(u'b=u"abcþ"', kc=kc)
+        wait_for_idle(kc)
+        _, reply = execute("%hist -f " + file, kc=kc)
+        nt.assert_equal(reply['status'], 'ok')
+        with io.open(file, encoding='utf-8') as f:
+            content = f.read()
+        nt.assert_in(u'a=1', content)
+        nt.assert_in(u'b=u"abcþ"', content)
+
 def test_help_output():
     """ipython kernel --help-all works"""
     tt.help_all_output_test('kernel')
diff --git a/IPython/kernel/tests/utils.py b/IPython/kernel/tests/utils.py
index 0577c6a..1f257ad 100644
--- a/IPython/kernel/tests/utils.py
+++ b/IPython/kernel/tests/utils.py
@@ -170,5 +170,10 @@ def assemble_output(iopub):
             pass
     return stdout, stderr
 
-
-
+def wait_for_idle(kc):
+    while True:
+        msg = kc.iopub_channel.get_msg(block=True, timeout=1)
+        msg_type = msg['msg_type']
+        content = msg['content']
+        if msg_type == 'status' and content['execution_state'] == 'idle':
+            break
diff --git a/IPython/kernel/zmq/ipkernel.py b/IPython/kernel/zmq/ipkernel.py
index 15840bb..8fc4063 100755
--- a/IPython/kernel/zmq/ipkernel.py
+++ b/IPython/kernel/zmq/ipkernel.py
@@ -341,7 +341,7 @@ class Kernel(Configurable):
         
         try:
             content = parent[u'content']
-            code = content[u'code']
+            code = py3compat.cast_unicode_py2(content[u'code'])
             silent = content[u'silent']
             store_history = content.get(u'store_history', not silent)
         except:
diff --git a/IPython/utils/py3compat.py b/IPython/utils/py3compat.py
index edd7b7d..822dad3 100644
--- a/IPython/utils/py3compat.py
+++ b/IPython/utils/py3compat.py
@@ -83,6 +83,7 @@ if sys.version_info[0] >= 3:
     str_to_bytes = encode
     bytes_to_str = decode
     cast_bytes_py2 = no_code
+    cast_unicode_py2 = no_code
     
     string_types = (str,)
     unicode_type = str
@@ -139,6 +140,7 @@ else:
     str_to_bytes = no_code
     bytes_to_str = no_code
     cast_bytes_py2 = cast_bytes
+    cast_unicode_py2 = cast_unicode
     
     string_types = (str, unicode)
     unicode_type = unicode