Try to pass repo.ui to reposetup hooks The ui object we received in this function may belong to another repo, which could be confusing from the hook point of view. Trying to use the ui object from the newly created repo should avoid this confusion.

#!/bin/sh

echo 'syntax error' > badext.py
abspath=`pwd`/badext.py

echo '[extensions]' >> $HGRCPATH
echo "badext = $abspath" >> $HGRCPATH

hg -q help help