When I changed my latest Lift-base project to Scala 2.8 (German) special characters in templates were no longer shown correctly. This is due to the fact that in PCDataXmlParser Lift uses Source.fromInputStream to read the template. On Scala 2.7 UTF-8 was used by default which changed in 2.8 where the platform default (Mac in my case) is used by default. Giving an explicit UTF-8 argument should fix the issue.