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unicode formats (u'{:n}'.format) in python 2.x assume that the thousands seperator is in ascii, so this fails:
>>> import locale
>>> locale.setlocale(locale.LC_NUMERIC, 'fra') # or fr_FR on UNIX
>>> u'{:n}'.format(10000)
Traceback (most recent call last):
 File "<pyshell#3>", line 1, in <module>
 u'{:n}'.format(10000)
UnicodeDecodeError: 'ascii' codec can't decode byte 0xa0 in position 2: ordinal not in range(128)
However, it works correctly in python 3, properly returning '10\xA00000' (the \xA0 is a nbsp)

Cf. the related issue 7300: "Unicode arguments in str.format()".

Ariel: would you like to provide a patch?

I don't work on CPython
On Sat, Jul 7, 2012 at 6:57 PM, Martin v. Löwis <report@bugs.python.org>wrote:
>
> Martin v. Löwis <martin@v.loewis.de> added the comment:
>
> Ariel: would you like to provide a patch?
>
> ----------
> nosy: +loewis
>
> _______________________________________
> Python tracker <report@bugs.python.org>
> <http://bugs.python.org/issue15276>
> _______________________________________
>

I can't reproduce this with Python 2.7.3.
berker@wakefield ~[master*]$ python
Python 2.7.3 (default, Apr 20 2012, 22:39:59) 
[GCC 4.6.3] on linux2
Type "help", "copyright", "credits" or "license" for more information.
>>> import locale
>>> locale.setlocale(locale.LC_NUMERIC, 'fr_FR')
'fr_FR'
>>> u'{:n}'.format(10000)
u'10 000'

I confirm the bug on 2.7.
$ ./python 
Python 2.7.3+ (2.7:ab9d6c4907e7+, Apr 25 2012, 20:02:36) 
[GCC 4.4.3] on linux2
Type "help", "copyright", "credits" or "license" for more information.
>>> import locale
>>> locale.setlocale(locale.LC_NUMERIC, 'uk_UA.UTF-8')
'uk_UA.UTF-8'
>>> u'{:n}'.format(10000)
Traceback (most recent call last):
 File "<stdin>", line 1, in <module>
UnicodeDecodeError: 'ascii' codec can't decode byte 0xc2 in position 2: ordinal not in range(128)
>>> '{:n}'.format(10000)
'10\xc2\xa0000'

I can't yet reproduce on my system, but after looking at the code, I believe the following are closer to the cause:
>>> format(10000, u'n')
>>> int.__format__(10000, u'n')
Incidentally, on my system, the following note in the docs is wrong:
"Note: format(value, format_spec) merely calls value.__format__(format_spec)."
(from http://docs.python.org/library/functions.html?#format )
>>> format(10000, u'n')
u'10000'
>>> 10000.__format__(u'n')
 File "<stdin>", line 1
 10000.__format__(u'n')
 ^
SyntaxError: invalid syntax
>>> int.__format__(10000, u'n')
'10000'
Observe also that format() and int.__format__() return different types.

The case with 10000.__format__ is confusing the parser. It sees:
<floating point number 10000.> __format__
which is indeed a syntax error.
Try:
>>> 10000 .__format__(u'n')
'10000'
or:
>>> (10000).__format__(u'n')
'10000'

> The case with 10000.__format__ is confusing the parser.
Interesting, good catch! That error did seem unusual. The two modified forms do give the same result as int.__format__() (though the type still differs).

I did some analysis of this issue.
For starters, I could not reproduce this on Mac OS X 10.7.4. I iterated through all available locales, and the separator was ASCII in all cases.
Instead, I was able to fake the issue by changing "," to "\xa0" in the following line--
http://hg.python.org/cpython/file/820032281f49/Objects/stringlib/formatter.h#l651
and then reproduce with:
>>> u'{:,}'.format(10000)
 ..
UnicodeDecodeError: 'ascii' codec can't decode byte 0xa0 in position 2: ordinal not in range(128)
>>> format(10000, u',')
 ..
UnicodeDecodeError: 'ascii' codec can't decode byte 0xa0 in position 2: ordinal not in range(128)
However, note this difference (see also issue 15952)--
>>> (10000).__format__(u',')
'10\xa0000'
The issue seems to be that PyObject_Format() in Objects/abstract.c (which, unlike int__format__() in Objects/intobject.c, does respect whether the format string is unicode or not) calls int__format__() to get the formatted string as a byte string. It then passes this to PyObject_Unicode() to convert to unicode. This in turn calls PyUnicode_FromEncodedObject() with a NULL encoding, which causes that code to use PyUnicode_GetDefaultEncoding() for the encoding (i.e. sys.getdefaultencoding()).
The right way to fix this seems to be to make int__format__() return unicode as appropriate, which may mean modifying formatter.h's format_int_or_long_internal() to return unicode -- as well as taking into account the locale encoding when accessing the locale's thousands separator.

Eric, it looks like you wrote this comment:
/* don't define FORMAT_LONG, FORMAT_FLOAT, and FORMAT_COMPLEX, since
 we can live with only the string versions of those. The builtin
 format() will convert them to unicode. */
in http://hg.python.org/cpython/file/19601d451d4c/Python/formatter_unicode.c
It seems like the current issue may be a valid reason for introducing a unicode FORMAT_INT (i.e. not just for type-purity and PEP 3101 compliance, but to avoid an exception). What do you think?

> What do you think?
[Even though I wasn't asked]
I think we may need to close the issue as "won't fix". Depending on the
exact change propsosed, it may be that the return type for existing
operations might change, which shouldn't be done in a bug fix release.
People running into this issue should port to Python 3 (IMO).

If we don't fix this (I'm leaning that way myself), I think we should somehow document the limitation. There are ways to acknowledge the limitation without getting into the specifics of this particular issue.

I fixed a similar bug in Python 3.3: issue #13706.
changeset: 75231:f89e2f4cda88
user: Victor Stinner <victor.stinner@haypocalc.com>
date: Fri Feb 24 00:37:51 2012 +0100
files: Include/unicodeobject.h Lib/test/test_format.py Objects/stringlib/asciilib.h Objects/stringlib/localeutil.h Objects/stringlib/stringdefs.h Objects/stringlib/ucs1lib.h 
description:
Issue #13706: Fix format(int, "n") for locale with non-ASCII thousands separator
 * Decode thousands separator and decimal point using PyUnicode_DecodeLocale()
 (from the locale encoding), instead of decoding them implicitly from latin1
 * Remove _PyUnicode_InsertThousandsGroupingLocale(), it was not used
 * Change _PyUnicode_InsertThousandsGrouping() API to return the maximum
 character if unicode is NULL
 * Replace MIN/MAX macros by Py_MIN/Py_MAX
 * stringlib/undef.h undefines STRINGLIB_IS_UNICODE
 * stringlib/localeutil.h only supports Unicode

> I can't reproduce this with Python 2.7.3.
> >>> locale.setlocale(locale.LC_NUMERIC, 'fr_FR')
> 'fr_FR'
> >>> u'{:n}'.format(10000)
> u'10 000'
I don't understand why, but the all french locales are the same. Some "french locale" uses the standard ASCII space (U+0020) as thousand seperator, others use the non-breaking space (U+00A0). I suppose that some systems prefer to avoid non-ASCII characters to avoid "Unicode issues".
On Ubuntu 12.04, locale.localeconv()['thousands_sep'] is chr(32) for the locale fr_FR.utf8.
You may need to install other locales to test this issue. For example, the ps_AF locale uses U+066b as the decimal point and the thousands separator.
I chose to not fix the issue in Python 3.2 because it needs to change too much code (and I don't want to introduce a regression and 3.2 code is very different than 3.3). You should upgrade to Python 3.3, or reimplement the Unicode format() function for numbers using locale.localeconv() ('thousands_sep', 'decimal_point' and 'grouping') :-/
Or find a more motivated developer. Or I can do the job if you pay me ;-)
(Read also the issue #13706 for more information.)

I have a brief documentation patch in mind for this, but it relies on documentation issue 15952 being addressed first (e.g. to say that format(value) returns Unicode when format_spec is Unicode and that value.__format__() can return a string of type str). So I'm marking issue 15952 as a dependency.

"If we don't fix this (I'm leaning that way myself), I think we should somehow document the limitation. There are ways to acknowledge the limitation without getting into the specifics of this particular issue."
I agree to documentation the limitation and close this issue as "wontfix".
A workaround is to format as a bytes string, and then decode the result from the locale encoding. It looks like locale.getpreferredencoding(True) should be used, not locale.getpreferredencoding(False).

For anyone stuck on Python 2.x, here is an workaround (maybe it could find it's way to documentation also):
 def fix_grouping(bytestring):
 try:
 return unicode(bytestring)
 except UnicodeDecodeError:
 return bytestring.decode("utf-8")

Python 2.7 is no longer supported.