--- a/mercurial/commands.py
+++ b/mercurial/commands.py
@@ -2432,6 +2432,7 @@ def serve(ui, repo, **opts):
 
     class service:
         def init(self):
+            util.set_signal_handler()
             try:
                 self.httpd = hgweb.server.create_server(parentui, repo)
             except socket.error, inst:

--- a/mercurial/util.py
+++ b/mercurial/util.py
@@ -1100,6 +1100,9 @@ else:
                 return p_name
         return default
 
+    def set_signal_handler():
+        pass
+
 def find_exe(name, default=None):
     '''find path of an executable.
     if name contains a path component, return it as is.  otherwise,

--- a/mercurial/util_win32.py
+++ b/mercurial/util_win32.py
@@ -299,3 +299,12 @@ class posixfile_nt(object):
             raise WinIOError(err)
 
 getuser_fallback = win32api.GetUserName
+
+def set_signal_handler():
+    """Register a termination handler for console events including
+    CTRL+C. python signal handlers do not work well with socket
+    operations.
+    """
+    def handler(event):
+        win32process.ExitProcess(1)
+    win32api.SetConsoleCtrlHandler(handler)