diff --git a/mercurial/util.py b/mercurial/util.py
--- a/mercurial/util.py
+++ b/mercurial/util.py
@@ -2856,13 +2856,219 @@ class ctxmanager(object):
             raise exc_val
         return received and suppressed
 
-# compression utility
+# compression code
+
+class compressormanager(object):
+    """Holds registrations of various compression engines.
+
+    This class essentially abstracts the differences between compression
+    engines to allow new compression formats to be added easily, possibly from
+    extensions.
+
+    Compressors are registered against the global instance by calling its
+    ``register()`` method.
+    """
+    def __init__(self):
+        self._engines = {}
+        # Bundle spec human name to engine name.
+        self._bundlenames = {}
+        # Internal bundle identifier to engine name.
+        self._bundletypes = {}
+
+    def __getitem__(self, key):
+        return self._engines[key]
+
+    def __contains__(self, key):
+        return key in self._engines
+
+    def __iter__(self):
+        return iter(self._engines.keys())
+
+    def register(self, engine):
+        """Register a compression engine with the manager.
+
+        The argument must be a ``compressionengine`` instance.
+        """
+        if not isinstance(engine, compressionengine):
+            raise ValueError(_('argument must be a compressionengine'))
+
+        name = engine.name()
+
+        if name in self._engines:
+            raise error.Abort(_('compression engine %s already registered') %
+                              name)
+
+        bundleinfo = engine.bundletype()
+        if bundleinfo:
+            bundlename, bundletype = bundleinfo
+
+            if bundlename in self._bundlenames:
+                raise error.Abort(_('bundle name %s already registered') %
+                                  bundlename)
+            if bundletype in self._bundletypes:
+                raise error.Abort(_('bundle type %s already registered by %s') %
+                                  (bundletype, self._bundletypes[bundletype]))
+
+            # No external facing name declared.
+            if bundlename:
+                self._bundlenames[bundlename] = name
+
+            self._bundletypes[bundletype] = name
+
+        self._engines[name] = engine
+
+    @property
+    def supportedbundlenames(self):
+        return set(self._bundlenames.keys())
+
+    @property
+    def supportedbundletypes(self):
+        return set(self._bundletypes.keys())
+
+    def forbundlename(self, bundlename):
+        """Obtain a compression engine registered to a bundle name.
+
+        Will raise KeyError if the bundle type isn't registered.
+        """
+        return self._engines[self._bundlenames[bundlename]]
+
+    def forbundletype(self, bundletype):
+        """Obtain a compression engine registered to a bundle type.
+
+        Will raise KeyError if the bundle type isn't registered.
+        """
+        return self._engines[self._bundletypes[bundletype]]
+
+compengines = compressormanager()
+
+class compressionengine(object):
+    """Base class for compression engines.
+
+    Compression engines must implement the interface defined by this class.
+    """
+    def name(self):
+        """Returns the name of the compression engine.
+
+        This is the key the engine is registered under.
+
+        This method must be implemented.
+        """
+        raise NotImplementedError()
+
+    def bundletype(self):
+        """Describes bundle identifiers for this engine.
+
+        If this compression engine isn't supported for bundles, returns None.
+
+        If this engine can be used for bundles, returns a 2-tuple of strings of
+        the user-facing "bundle spec" compression name and an internal
+        identifier used to denote the compression format within bundles. To
+        exclude the name from external usage, set the first element to ``None``.
+
+        If bundle compression is supported, the class must also implement
+        ``compressorobj`` and `decompressorreader``.
+        """
+        return None
+
+    def compressorobj(self):
+        """(Temporary) Obtain an object used for compression.
+
+        The returned object has ``compress(data)`` and ``flush()`` methods.
+        These are used to incrementally feed data chunks into a compressor.
+        """
+        raise NotImplementedError()
+
+    def decompressorreader(self, fh):
+        """Perform decompression on a file object.
+
+        Argument is an object with a ``read(size)`` method that returns
+        compressed data. Return value is an object with a ``read(size)`` that
+        returns uncompressed data.
+        """
+        raise NotImplementedError()
+
+class _zlibengine(compressionengine):
+    def name(self):
+        return 'zlib'
+
+    def bundletype(self):
+        return 'gzip', 'GZ'
+
+    def compressorobj(self):
+        return zlib.compressobj()
+
+    def decompressorreader(self, fh):
+        def gen():
+            d = zlib.decompressobj()
+            for chunk in filechunkiter(fh):
+                yield d.decompress(chunk)
+
+        return chunkbuffer(gen())
+
+compengines.register(_zlibengine())
+
+class _bz2engine(compressionengine):
+    def name(self):
+        return 'bz2'
+
+    def bundletype(self):
+        return 'bzip2', 'BZ'
+
+    def compressorobj(self):
+        return bz2.BZ2Compressor()
+
+    def decompressorreader(self, fh):
+        def gen():
+            d = bz2.BZ2Decompressor()
+            for chunk in filechunkiter(fh):
+                yield d.decompress(chunk)
+
+        return chunkbuffer(gen())
+
+compengines.register(_bz2engine())
+
+class _truncatedbz2engine(compressionengine):
+    def name(self):
+        return 'bz2truncated'
+
+    def bundletype(self):
+        return None, '_truncatedBZ'
+
+    # We don't implement compressorobj because it is hackily handled elsewhere.
+
+    def decompressorreader(self, fh):
+        def gen():
+            # The input stream doesn't have the 'BZ' header. So add it back.
+            d = bz2.BZ2Decompressor()
+            d.decompress('BZ')
+            for chunk in filechunkiter(fh):
+                yield d.decompress(chunk)
+
+        return chunkbuffer(gen())
+
+compengines.register(_truncatedbz2engine())
 
 class nocompress(object):
     def compress(self, x):
         return x
+
     def flush(self):
-        return ""
+        return ''
+
+class _noopengine(compressionengine):
+    def name(self):
+        return 'none'
+
+    def bundletype(self):
+        return 'none', 'UN'
+
+    def compressorobj(self):
+        return nocompress()
+
+    def decompressorreader(self, fh):
+        return fh
+
+compengines.register(_noopengine())
 
 compressors = {
     None: nocompress,