diff --git a/CHANGELOG.md b/CHANGELOG.md
index 3daec305..d6468ed2 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -1,6 +1,8 @@
 Changelog
 =========
 
+* Fix "Unexpected token" error for U+2028 unicode newline. Fixes [#126](https://github.com/mozilla/nunjucks/issues/126) and [#736](https://github.com/mozilla/nunjucks/issues/736)
+
 3.1.3 (May 19 2018)
 -------------------
 
diff --git a/nunjucks/src/compiler.js b/nunjucks/src/compiler.js
index 6c000fe7..6ef3c149 100644
--- a/nunjucks/src/compiler.js
+++ b/nunjucks/src/compiler.js
@@ -278,6 +278,7 @@ class Compiler extends Obj {
       val = val.replace(/\n/g, '\\n');
       val = val.replace(/\r/g, '\\r');
       val = val.replace(/\t/g, '\\t');
+      val = val.replace(/\u2028/g, '\\u2028');
       this._emit(`"${val}"`);
     } else if (node.value === null) {
       this._emit('null');
diff --git a/tests/compiler.js b/tests/compiler.js
index 4c3fbaa8..d6b590d9 100644
--- a/tests/compiler.js
+++ b/tests/compiler.js
@@ -55,6 +55,11 @@
       finish(done);
     });
 
+    it('should escape Unicode line seperators', function(done) {
+      equal('\u2028', '\u2028');
+      finish(done);
+    });
+
     it('should compile references', function(done) {
       equal('{{ foo.bar }}',
         {