--- a/mercurial/commands.py	Sat Dec 24 13:51:12 2016 -0700
+++ b/mercurial/commands.py	Sat Dec 24 15:21:46 2016 -0700
@@ -1959,6 +1959,12 @@
              fm.formatlist(sorted(e.name() for e in compengines
                                   if e.available()),
                            name='compengine', fmt='%s', sep=', '))
+    wirecompengines = util.compengines.supportedwireengines(util.SERVERROLE)
+    fm.write('compenginesserver', _('checking available compression engines '
+                                    'for wire protocol (%s)\n'),
+             fm.formatlist([e.name() for e in wirecompengines
+                            if e.wireprotosupport()],
+                           name='compengine', fmt='%s', sep=', '))
 
     # templates
     p = templater.templatepaths()

--- a/mercurial/help/config.txt	Sat Dec 24 13:51:12 2016 -0700
+++ b/mercurial/help/config.txt	Sat Dec 24 15:21:46 2016 -0700
@@ -1545,6 +1545,21 @@
 
 Controls generic server settings.
 
+``compressionengines``
+    List of compression engines and their relative priority to advertise
+    to clients.
+
+    The order of compression engines determines their priority, the first
+    having the highest priority. If a compression engine is not listed
+    here, it won't be advertised to clients.
+
+    If not set (the default), built-in defaults are used. Run
+    :hg:`debuginstall` to list available compression engines and their
+    default wire protocol priority.
+
+    Older Mercurial clients only support zlib compression and this setting
+    has no effect for legacy clients.
+
 ``uncompressed``
     Whether to allow clients to clone a repository using the
     uncompressed streaming protocol. This transfers about 40% more

--- a/mercurial/wireproto.py	Sat Dec 24 13:51:12 2016 -0700
+++ b/mercurial/wireproto.py	Sat Dec 24 15:21:46 2016 -0700
@@ -607,6 +607,55 @@
 
     return ui.configbool('server', 'bundle1', True)
 
+def supportedcompengines(ui, proto, role):
+    """Obtain the list of supported compression engines for a request."""
+    assert role in (util.CLIENTROLE, util.SERVERROLE)
+
+    compengines = util.compengines.supportedwireengines(role)
+
+    # Allow config to override default list and ordering.
+    if role == util.SERVERROLE:
+        configengines = ui.configlist('server', 'compressionengines')
+        config = 'server.compressionengines'
+    else:
+        # This is currently implemented mainly to facilitate testing. In most
+        # cases, the server should be in charge of choosing a compression engine
+        # because a server has the most to lose from a sub-optimal choice. (e.g.
+        # CPU DoS due to an expensive engine or a network DoS due to poor
+        # compression ratio).
+        configengines = ui.configlist('experimental',
+                                      'clientcompressionengines')
+        config = 'experimental.clientcompressionengines'
+
+    # No explicit config. Filter out the ones that aren't supposed to be
+    # advertised and return default ordering.
+    if not configengines:
+        attr = 'serverpriority' if role == util.SERVERROLE else 'clientpriority'
+        return [e for e in compengines
+                if getattr(e.wireprotosupport(), attr) > 0]
+
+    # If compression engines are listed in the config, assume there is a good
+    # reason for it (like server operators wanting to achieve specific
+    # performance characteristics). So fail fast if the config references
+    # unusable compression engines.
+    validnames = set(e.name() for e in compengines)
+    invalidnames = set(e for e in configengines if e not in validnames)
+    if invalidnames:
+        raise error.Abort(_('invalid compression engine defined in %s: %s') %
+                          (config, ', '.join(sorted(invalidnames))))
+
+    compengines = [e for e in compengines if e.name() in configengines]
+    compengines = sorted(compengines,
+                         key=lambda e: configengines.index(e.name()))
+
+    if not compengines:
+        raise error.Abort(_('%s config option does not specify any known '
+                            'compression engines') % config,
+                          hint=_('usable compression engines: %s') %
+                          ', '.sorted(validnames))
+
+    return compengines
+
 # list of commands
 commands = {}
 
@@ -723,6 +772,16 @@
         if repo.ui.configbool('experimental', 'httppostargs', False):
             caps.append('httppostargs')
 
+        # FUTURE advertise 0.2rx once support is implemented
+        # FUTURE advertise minrx and mintx after consulting config option
+        caps.append('httpmediatype=0.1rx,0.1tx,0.2tx')
+
+        compengines = supportedcompengines(repo.ui, proto, util.SERVERROLE)
+        if compengines:
+            comptypes = ','.join(urlreq.quote(e.wireprotosupport().name)
+                                 for e in compengines)
+            caps.append('compression=%s' % comptypes)
+
     return caps
 
 # If you are writing an extension and consider wrapping this function. Wrap

--- a/tests/test-hgweb-commands.t	Sat Dec 24 13:51:12 2016 -0700
+++ b/tests/test-hgweb-commands.t	Sat Dec 24 15:21:46 2016 -0700
@@ -1903,7 +1903,7 @@
   $ get-with-headers.py 127.0.0.1:$HGPORT '?cmd=capabilities'; echo
   200 Script output follows
   
-  lookup changegroupsubset branchmap pushkey known getbundle unbundlehash batch bundle2=HG20%0Achangegroup%3D01%2C02%0Adigests%3Dmd5%2Csha1%2Csha512%0Aerror%3Dabort%2Cunsupportedcontent%2Cpushraced%2Cpushkey%0Ahgtagsfnodes%0Alistkeys%0Apushkey%0Aremote-changegroup%3Dhttp%2Chttps unbundle=HG10GZ,HG10BZ,HG10UN httpheader=1024
+  lookup changegroupsubset branchmap pushkey known getbundle unbundlehash batch bundle2=HG20%0Achangegroup%3D01%2C02%0Adigests%3Dmd5%2Csha1%2Csha512%0Aerror%3Dabort%2Cunsupportedcontent%2Cpushraced%2Cpushkey%0Ahgtagsfnodes%0Alistkeys%0Apushkey%0Aremote-changegroup%3Dhttp%2Chttps unbundle=HG10GZ,HG10BZ,HG10UN httpheader=1024 httpmediatype=0.1rx,0.1tx,0.2tx compression=*zlib (glob)
 
 heads
 
@@ -2154,6 +2154,8 @@
   bundle2=HG20%0Achangegroup%3D01%2C02%0Adigests%3Dmd5%2Csha1%2Csha512%0Aerror%3Dabort%2Cunsupportedcontent%2Cpushraced%2Cpushkey%0Ahgtagsfnodes%0Alistkeys%0Apushkey%0Aremote-changegroup%3Dhttp%2Chttps
   unbundle=HG10GZ,HG10BZ,HG10UN
   httpheader=1024
+  httpmediatype=0.1rx,0.1tx,0.2tx
+  compression=*zlib (glob)
 
 heads
 

--- /dev/null	Thu Jan 01 00:00:00 1970 +0000
+++ b/tests/test-http-protocol.t	Sat Dec 24 15:21:46 2016 -0700
@@ -0,0 +1,44 @@
+  $ cat >> $HGRCPATH << EOF
+  > [web]
+  > push_ssl = false
+  > allow_push = *
+  > EOF
+
+  $ hg init server
+  $ cd server
+  $ touch a
+  $ hg -q commit -A -m initial
+  $ cd ..
+
+  $ hg -R server serve -p $HGPORT -d --pid-file hg.pid
+  $ cat hg.pid >> $DAEMON_PIDS
+
+compression formats are advertised in compression capability
+
+#if zstd
+  $ get-with-headers.py 127.0.0.1:$HGPORT '?cmd=capabilities' | tr ' ' '\n' | grep compression
+  compression=zstd,zlib
+#else
+  $ get-with-headers.py 127.0.0.1:$HGPORT '?cmd=capabilities' | tr ' ' '\n' | grep compression
+  compression=ZL
+#endif
+
+  $ killdaemons.py
+
+server.compressionengines can replace engines list wholesale
+
+  $ hg --config server.compressionengines=none -R server serve -p $HGPORT -d --pid-file hg.pid
+  $ cat hg.pid > $DAEMON_PIDS
+  $ get-with-headers.py 127.0.0.1:$HGPORT '?cmd=capabilities' | tr ' ' '\n' | grep compression
+  compression=none
+
+  $ killdaemons.py
+
+Order of engines can also change
+
+  $ hg --config server.compressionengines=none,zlib -R server serve -p $HGPORT -d --pid-file hg.pid
+  $ cat hg.pid > $DAEMON_PIDS
+  $ get-with-headers.py 127.0.0.1:$HGPORT '?cmd=capabilities' | tr ' ' '\n' | grep compression
+  compression=none,zlib
+
+  $ killdaemons.py

--- a/tests/test-install.t	Sat Dec 24 13:51:12 2016 -0700
+++ b/tests/test-install.t	Sat Dec 24 15:21:46 2016 -0700
@@ -13,6 +13,7 @@
   checking installed modules (*mercurial)... (glob)
   checking registered compression engines (*zlib*) (glob)
   checking available compression engines (*zlib*) (glob)
+  checking available compression engines for wire protocol (*zlib*) (glob)
   checking templates (*mercurial?templates)... (glob)
   checking default template (*mercurial?templates?map-cmdline.default) (glob)
   checking commit editor... (* -c "import sys; sys.exit(0)") (glob)
@@ -25,6 +26,7 @@
    {
     "compengines": ["bz2", "bz2truncated", "none", "zlib"*], (glob)
     "compenginesavail": ["bz2", "bz2truncated", "none", "zlib"*], (glob)
+    "compenginesserver": [*"zlib"*], (glob)
     "defaulttemplate": "*mercurial?templates?map-cmdline.default", (glob)
     "defaulttemplateerror": null,
     "defaulttemplatenotfound": "default",
@@ -64,6 +66,7 @@
   checking installed modules (*mercurial)... (glob)
   checking registered compression engines (*zlib*) (glob)
   checking available compression engines (*zlib*) (glob)
+  checking available compression engines for wire protocol (*zlib*) (glob)
   checking templates (*mercurial?templates)... (glob)
   checking default template (*mercurial?templates?map-cmdline.default) (glob)
   checking commit editor... (* -c "import sys; sys.exit(0)") (glob)
@@ -93,6 +96,7 @@
   checking installed modules (*mercurial)... (glob)
   checking registered compression engines (*zlib*) (glob)
   checking available compression engines (*zlib*) (glob)
+  checking available compression engines for wire protocol (*zlib*) (glob)
   checking templates (*mercurial?templates)... (glob)
   checking default template (*mercurial?templates?map-cmdline.default) (glob)
   checking commit editor... (* -c "import sys; sys.exit(0)") (glob)