diff --git a/target-mips/cpu.h b/target-mips/cpu.h
index 7285636b68..c21b8e43ff 100644
--- a/target-mips/cpu.h
+++ b/target-mips/cpu.h
@@ -363,6 +363,7 @@ struct CPUMIPSState {
 #define CP0C2_SA   0
     int32_t CP0_Config3;
 #define CP0C3_M    31
+#define CP0C3_ISA_ON_EXC 16
 #define CP0C3_DSPP 10
 #define CP0C3_LPA  7
 #define CP0C3_VEIC 6
diff --git a/target-mips/helper.c b/target-mips/helper.c
index 8102f03c26..ea221ab53f 100644
--- a/target-mips/helper.c
+++ b/target-mips/helper.c
@@ -385,6 +385,18 @@ static target_ulong exception_resume_pc (CPUState *env)
 
     return bad_pc;
 }
+
+static void set_hflags_for_handler (CPUState *env)
+{
+    /* Exception handlers are entered in 32-bit mode.  */
+    env->hflags &= ~(MIPS_HFLAG_M16);
+    /* ...except that microMIPS lets you choose.  */
+    if (env->insn_flags & ASE_MICROMIPS) {
+        env->hflags |= (!!(env->CP0_Config3
+                           & (1 << CP0C3_ISA_ON_EXC))
+                        << MIPS_HFLAG_M16_SHIFT);
+    }
+}
 #endif
 
 void do_interrupt (CPUState *env)
@@ -440,8 +452,7 @@ void do_interrupt (CPUState *env)
         if (!(env->CP0_Status & (1 << CP0St_EXL)))
             env->CP0_Cause &= ~(1 << CP0Ca_BD);
         env->active_tc.PC = (int32_t)0xBFC00480;
-        /* Exception handlers are entered in 32-bit mode.  */
-        env->hflags &= ~(MIPS_HFLAG_M16);
+        set_hflags_for_handler(env);
         break;
     case EXCP_RESET:
         cpu_reset(env);
@@ -461,8 +472,7 @@ void do_interrupt (CPUState *env)
         if (!(env->CP0_Status & (1 << CP0St_EXL)))
             env->CP0_Cause &= ~(1 << CP0Ca_BD);
         env->active_tc.PC = (int32_t)0xBFC00000;
-        /* Exception handlers are entered in 32-bit mode.  */
-        env->hflags &= ~(MIPS_HFLAG_M16);
+        set_hflags_for_handler(env);
         break;
     case EXCP_EXT_INTERRUPT:
         cause = 0;
@@ -581,8 +591,7 @@ void do_interrupt (CPUState *env)
             env->active_tc.PC = (int32_t)(env->CP0_EBase & ~0x3ff);
         }
         env->active_tc.PC += offset;
-        /* Exception handlers are entered in 32-bit mode.  */
-        env->hflags &= ~(MIPS_HFLAG_M16);
+        set_hflags_for_handler(env);
         env->CP0_Cause = (env->CP0_Cause & ~(0x1f << CP0Ca_EC)) | (cause << CP0Ca_EC);
         break;
     default: