diff --git a/hgext/largefiles/__init__.py b/hgext/largefiles/__init__.py
--- a/hgext/largefiles/__init__.py
+++ b/hgext/largefiles/__init__.py
@@ -105,9 +105,10 @@ explicitly do so with the --large flag p
 command.
 '''
 
-from mercurial import commands, localrepo
+from mercurial import commands, hg, localrepo
 
 import lfcommands
+import proto
 import reposetup
 import uisetup as uisetupmod
 
@@ -121,6 +122,7 @@ def featuresetup(ui, supported):
 
 def uisetup(ui):
     localrepo.localrepository.featuresetupfuncs.add(featuresetup)
+    hg.wirepeersetupfuncs.append(proto.wirereposetup)
     uisetupmod.uisetup(ui)
 
 commands.norepo += " lfconvert"
diff --git a/hgext/largefiles/reposetup.py b/hgext/largefiles/reposetup.py
--- a/hgext/largefiles/reposetup.py
+++ b/hgext/largefiles/reposetup.py
@@ -16,14 +16,13 @@ from mercurial.i18n import _
 from mercurial import localrepo
 
 import lfcommands
-import proto
 import lfutil
 
 def reposetup(ui, repo):
-    # wire repositories should be given new wireproto functions but not the
-    # other largefiles modifications
+    # wire repositories should be given new wireproto functions
+    # by "proto.wirereposetup()" via "hg.wirepeersetupfuncs"
     if not repo.local():
-        return proto.wirereposetup(ui, repo)
+        return
 
     class lfilesrepo(repo.__class__):
         lfstatus = False
diff --git a/mercurial/hg.py b/mercurial/hg.py
--- a/mercurial/hg.py
+++ b/mercurial/hg.py
@@ -98,6 +98,9 @@ def openpath(ui, path):
     else:
         return url.open(ui, path)
 
+# a list of (ui, repo) functions called for wire peer initialization
+wirepeersetupfuncs = []
+
 def _peerorrepo(ui, path, create=False):
     """return a repository object for the specified path"""
     obj = _peerlookup(path).instance(ui, path, create)
@@ -106,6 +109,9 @@ def _peerorrepo(ui, path, create=False):
         hook = getattr(module, 'reposetup', None)
         if hook:
             hook(ui, obj)
+    if not obj.local():
+        for f in wirepeersetupfuncs:
+            f(ui, obj)
     return obj
 
 def repository(ui, path='', create=False):
diff --git a/tests/test-largefiles.t b/tests/test-largefiles.t
--- a/tests/test-largefiles.t
+++ b/tests/test-largefiles.t
@@ -2285,4 +2285,30 @@ enabling largefiles extension.
   $ test -d clone-pull-dst
   [1]
 
+#if serve
+
+Test largefiles specific peer setup, when largefiles is enabled
+locally (issue4109)
+
+  $ hg showconfig extensions | grep largefiles
+  extensions.largefiles=!
+  $ mkdir -p $TESTTMP/individualenabling/usercache
+
+  $ hg serve -R enabledlocally -d -p $HGPORT --pid-file hg.pid
+  $ cat hg.pid >> $DAEMON_PIDS
+
+  $ hg init pull-dst
+  $ cat > pull-dst/.hg/hgrc <<EOF
+  > [extensions]
+  > # enable locally
+  > largefiles=
+  > [largefiles]
+  > # ignore system cache to force largefiles specific wire proto access
+  > usercache=$TESTTMP/individualenabling/usercache
+  > EOF
+  $ hg -R pull-dst -q pull -u http://localhost:$HGPORT
+
+  $ "$TESTDIR/killdaemons.py" $DAEMON_PIDS
+#endif
+
   $ cd ..