diff --git a/app/models/repository/mercurial.rb b/app/models/repository/mercurial.rb
index 18cbc94..c3fd154 100644
--- a/app/models/repository/mercurial.rb
+++ b/app/models/repository/mercurial.rb
@@ -21,6 +21,15 @@ class Repository::Mercurial < Repository
   attr_protected :root_url
   validates_presence_of :url
 
+  def init_cache
+    return unless dir = repositories_cache_directory
+    # we need to use a cache only if repository isn't local and dir exists
+    if url[/^(|https?|ssh):\/\//]
+      update_attribute(:cache_path, dir + project.identifier)
+      update_attribute(:cache, true)
+    end
+  end
+
   def scm_adapter
     Redmine::Scm::Adapters::MercurialAdapter
   end
@@ -53,6 +62,8 @@ class Repository::Mercurial < Repository
   end
 
   def fetch_changesets
+    create_or_sync_cache if cache
+
     scm_info = scm.info
     if scm_info
       # latest revision found in database
diff --git a/lib/redmine/scm/adapters/mercurial_adapter.rb b/lib/redmine/scm/adapters/mercurial_adapter.rb
index 4eed776..9eecb60 100644
--- a/lib/redmine/scm/adapters/mercurial_adapter.rb
+++ b/lib/redmine/scm/adapters/mercurial_adapter.rb
@@ -199,6 +199,18 @@ module Redmine
           return nil if $? && $?.exitstatus != 0
           blame
         end
+
+        def create_cache
+          cmd = "#{HG_BIN} clone #{@orig_url} #{@root_url}"
+          shellout(cmd) { |io| io.read }
+        end
+
+        def synchronize
+          return unless File.directory?(@url)
+          cmd = "#{HG_BIN} -R #{@url} pull"
+          shellout(cmd)
+        end
+
       end
     end
   end