diff --git a/CHANGELOG.md b/CHANGELOG.md
index 8e9d187ef..d11eefea1 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -9,6 +9,10 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 ### Changed
 - Dry-run result output improvements [1123](https://github.com/paritytech/cargo-contract/pull/1123)
 
+### Fixed
+- Configure tty output correctly - [#1209]((https://github.com/paritytech/cargo-contract/pull/1209))
+
+
 ## [3.0.1]
 
 ### Fixed
diff --git a/crates/build/src/util/mod.rs b/crates/build/src/util/mod.rs
index 867cafcde..4caf61274 100644
--- a/crates/build/src/util/mod.rs
+++ b/crates/build/src/util/mod.rs
@@ -104,9 +104,9 @@ pub fn cargo_tty_output(cmd: Expression) -> Expression {
         .map(|(width, _)| width.to_string())
         .unwrap_or_else(|| "100".to_string());
 
-    cmd.env("CARGO_TERM_COLOR", "always")
+    cmd.env("CARGO_TERM_COLOR", "auto")
         .env("CARGO_TERM_PROGRESS_WIDTH", term_size)
-        .env("CARGO_TERM_PROGRESS_WHEN", "always")
+        .env("CARGO_TERM_PROGRESS_WHEN", "auto")
 }
 
 /// Returns the base name of the path.