diff --git a/IPython/core/magics/osm.py b/IPython/core/magics/osm.py
index c29ed94..3f47517 100644
--- a/IPython/core/magics/osm.py
+++ b/IPython/core/magics/osm.py
@@ -31,7 +31,7 @@ from IPython.core.magic import  (
     Magics, compress_dhist, magics_class, line_magic, cell_magic, line_cell_magic
 )
 from IPython.testing.skipdoctest import skip_doctest
-from IPython.utils.io import file_read, nlprint
+from IPython.utils.io import file_read, nlprint, source_to_unicode
 from IPython.utils.path import get_py_filename, unquote_filename
 from IPython.utils.process import abbrev_cwd
 from IPython.utils.terminal import set_term_title
@@ -691,7 +691,7 @@ class OSMagics(Magics):
             print "Error: no such file, variable, URL, history range or macro"
             return
 
-        page.page(self.shell.pycolorize(cont))
+        page.page(self.shell.pycolorize(source_to_unicode(cont)))
 
     @magic_arguments.magic_arguments()
     @magic_arguments.argument(
diff --git a/IPython/utils/io.py b/IPython/utils/io.py
index ec00a29..40a3b96 100644
--- a/IPython/utils/io.py
+++ b/IPython/utils/io.py
@@ -14,6 +14,7 @@ from __future__ import print_function
 #-----------------------------------------------------------------------------
 # Imports
 #-----------------------------------------------------------------------------
+import re
 import os
 import sys
 import tempfile
@@ -154,6 +155,23 @@ class Tee(object):
             self.close()
 
 
+def source_to_unicode(txt):
+    """Converts string with python source code to unicode
+    """
+    if isinstance(txt, unicode):
+        return txt
+    
+    reg = re.compile("#.*coding[:=]\s*([-\w.]+)")
+    for row in txt.split("\n", 2)[:2]: #We only need to check the first two lines
+        result = reg.match(row)
+        if result:
+            coding = result.groups()[0]
+            break
+    else:
+        coding = "ascii"
+    return txt.decode(coding, errors="replace")
+    
+
 def file_read(filename):
     """Read a file and close it.  Returns the file source."""
     fobj = open(filename,'r');