diff --git a/examples/basic/app.js b/examples/basic/app.js
index 2e22b6763..b248d7841 100644
--- a/examples/basic/app.js
+++ b/examples/basic/app.js
@@ -35,6 +35,7 @@ const Home = { template: '<div>home</div>' }
 const Foo = { template: '<div>foo</div>' }
 const Bar = { template: '<div>bar</div>' }
 const Unicode = { template: '<div>unicode</div>' }
+const Query = { template: '<div>query: "{{ $route.params.q }}"</div>' }
 
 // 3. Create the router
 const router = new VueRouter({
@@ -44,7 +45,8 @@ const router = new VueRouter({
     { path: '/', component: Home },
     { path: '/foo', component: Foo },
     { path: '/bar', component: Bar },
-    { path: '/é', component: Unicode }
+    { path: '/é', component: Unicode },
+    { path: '/query/:q', component: Query }
   ]
 })
 
@@ -83,6 +85,7 @@ const vueInstance = new Vue({
           </li>
         </router-link>
         <li><router-link to="/foo" replace>/foo (replace)</router-link></li>
+        <li><router-link to="/query/A%25">/query/A%</router-link></li>
         <li><router-link to="/?delay=200">/ (delay of 500ms)</router-link></li>
         <li><router-link to="/foo?delay=200">/foo (delay of 500ms)</router-link></li>
       </ul>
diff --git a/examples/hash-mode/app.js b/examples/hash-mode/app.js
index 48b9ab1d6..80a2056ab 100644
--- a/examples/hash-mode/app.js
+++ b/examples/hash-mode/app.js
@@ -35,6 +35,7 @@ const Home = { template: '<div>home</div>' }
 const Foo = { template: '<div>foo</div>' }
 const Bar = { template: '<div>bar</div>' }
 const Unicode = { template: '<div>unicode: {{ $route.params.unicode }}</div>' }
+const Query = { template: '<div>query: "{{ $route.params.q }}"</div>' }
 
 // 3. Create the router
 const router = new VueRouter({
@@ -45,7 +46,8 @@ const router = new VueRouter({
     { path: '/foo', component: Foo },
     { path: '/bar', component: Bar },
     { path: '/é', component: Unicode },
-    { path: '/é/:unicode', component: Unicode }
+    { path: '/é/:unicode', component: Unicode },
+    { path: '/query/:q', component: Query }
   ]
 })
 
@@ -66,6 +68,7 @@ const vueInstance = new Vue({
         <li><router-link to="/é/ñ">/é/ñ</router-link></li>
         <li><router-link to="/é/ñ?t=%25ñ">/é/ñ?t=%ñ</router-link></li>
         <li><router-link to="/é/ñ#é">/é/ñ#é</router-link></li>
+        <li><router-link to="/query/A%25">/query/A%</router-link></li>  
       </ul>
       <pre id="query-t">{{ $route.query.t }}</pre>
       <pre id="hash">{{ $route.hash }}</pre>
diff --git a/src/create-matcher.js b/src/create-matcher.js
index ab62be430..c67538bc8 100644
--- a/src/create-matcher.js
+++ b/src/create-matcher.js
@@ -175,7 +175,7 @@ function matchRoute (
   path: string,
   params: Object
 ): boolean {
-  const m = path.match(regex)
+  const m = decodeURI(path).match(regex)
 
   if (!m) {
     return false
@@ -185,10 +185,9 @@ function matchRoute (
 
   for (let i = 1, len = m.length; i < len; ++i) {
     const key = regex.keys[i - 1]
-    const val = typeof m[i] === 'string' ? decodeURIComponent(m[i]) : m[i]
     if (key) {
       // Fix #1994: using * with props: true generates a param named 0
-      params[key.name || 'pathMatch'] = val
+      params[key.name || 'pathMatch'] = m[i]
     }
   }
 
diff --git a/src/history/hash.js b/src/history/hash.js
index b3372e10d..e0ddf2d7c 100644
--- a/src/history/hash.js
+++ b/src/history/hash.js
@@ -124,18 +124,6 @@ export function getHash (): string {
   if (index < 0) return ''
 
   href = href.slice(index + 1)
-  // decode the hash but not the search or hash
-  // as search(query) is already decoded
-  // https://github.com/vuejs/vue-router/issues/2708
-  const searchIndex = href.indexOf('?')
-  if (searchIndex < 0) {
-    const hashIndex = href.indexOf('#')
-    if (hashIndex > -1) {
-      href = decodeURI(href.slice(0, hashIndex)) + href.slice(hashIndex)
-    } else href = decodeURI(href)
-  } else {
-    href = decodeURI(href.slice(0, searchIndex)) + href.slice(searchIndex)
-  }
 
   return href
 }
diff --git a/src/history/html5.js b/src/history/html5.js
index 8200b3b28..9af347fe8 100644
--- a/src/history/html5.js
+++ b/src/history/html5.js
@@ -86,7 +86,7 @@ export class HTML5History extends History {
 }
 
 export function getLocation (base: string): string {
-  let path = decodeURI(window.location.pathname)
+  let path = window.location.pathname
   if (base && path.toLowerCase().indexOf(base.toLowerCase()) === 0) {
     path = path.slice(base.length)
   }
diff --git a/test/e2e/specs/basic.js b/test/e2e/specs/basic.js
index 25d3fed3f..1a623c0c6 100644
--- a/test/e2e/specs/basic.js
+++ b/test/e2e/specs/basic.js
@@ -9,8 +9,8 @@ module.exports = {
     browser
       .url('http://localhost:8080/basic/')
       .waitForElementVisible('#app', 1000)
-      .assert.count('li', 11)
-      .assert.count('li a', 11)
+      .assert.count('li', 12)
+      .assert.count('li a', 12)
       // assert correct href with base
       .assert.attributeContains('li:nth-child(1) a', 'href', '/basic/')
       .assert.attributeContains('li:nth-child(2) a', 'href', '/basic/foo')
@@ -20,6 +20,7 @@ module.exports = {
       .assert.attributeContains('li:nth-child(6) a', 'href', '/basic/%C3%A9?t=%25%C3%B1')
       .assert.attributeContains('li:nth-child(7) a', 'href', '/basic/%C3%A9#%25%C3%B1')
       .assert.attributeContains('li:nth-child(8) a', 'href', '/basic/foo')
+      .assert.attributeContains('li:nth-child(10) a', 'href', '/basic/query/A%')
       .assert.containsText('.view', 'home')
 
       .click('li:nth-child(2) a')
@@ -70,6 +71,15 @@ module.exports = {
       .assert.cssClassPresent('li:nth-child(8)', 'exact-active')
       .assert.attributeEquals('li:nth-child(8) a', 'class', '')
 
+      // encoded percentage as path param
+      // https://github.com/vuejs/vue-router/issues/2725
+      .url('http://localhost:8080/basic/query/A%25')
+      .waitForElementVisible('#app', 1000)
+      .assert.containsText('.view', 'query: "A%"')
+      .click('li:nth-child(10) a')
+      .assert.urlEquals('http://localhost:8080/basic/query/A%25')
+      .assert.containsText('.view', 'query: "A%"')
+
       // Listener cleanup
       .assert.containsText('#popstate-count', '1 popstate listeners')
       .click('#unmount')
@@ -84,8 +94,8 @@ module.exports = {
       .waitForElementVisible('#app', 1000)
       .assert.containsText('.view', 'home')
       // go to foo with a delay
+      .click('li:nth-child(12) a')
       .click('li:nth-child(11) a')
-      .click('li:nth-child(10) a')
       .waitFor(300)
       // we should stay at /basic after the delay
       .assert.urlEquals('http://localhost:8080/basic/?delay=200')
diff --git a/test/e2e/specs/hash-mode.js b/test/e2e/specs/hash-mode.js
index 569285a23..15520313f 100644
--- a/test/e2e/specs/hash-mode.js
+++ b/test/e2e/specs/hash-mode.js
@@ -9,14 +9,15 @@ module.exports = {
     browser
       .url('http://localhost:8080/hash-mode/')
       .waitForElementVisible('#app', 1000)
-      .assert.count('li', 8)
-      .assert.count('li a', 7)
+      .assert.count('li', 9)
+      .assert.count('li a', 8)
       .assert.attributeContains('li:nth-child(1) a', 'href', '/hash-mode/#/')
       .assert.attributeContains('li:nth-child(2) a', 'href', '/hash-mode/#/foo')
       .assert.attributeContains('li:nth-child(3) a', 'href', '/hash-mode/#/bar')
       .assert.attributeContains('li:nth-child(5) a', 'href', '/hash-mode/#/%C3%A9')
       .assert.attributeContains('li:nth-child(6) a', 'href', '/hash-mode/#/%C3%A9/%C3%B1')
       .assert.attributeContains('li:nth-child(7) a', 'href', '/hash-mode/#/%C3%A9/%C3%B1?t=%25%C3%B1')
+      .assert.attributeContains('li:nth-child(9) a', 'href', '/hash-mode/#/query/A%')
       .assert.containsText('.view', 'home')
 
       .click('li:nth-child(2) a')
@@ -58,6 +59,15 @@ module.exports = {
       .assert.containsText('.view', 'unicode: ñ')
       .assert.containsText('#query-t', '%')
 
+      // percentage as path param
+      // https://github.com/vuejs/vue-router/issues/2725
+      .url('http://localhost:8080/hash-mode/#/query/A%25')
+      .waitForElementVisible('#app', 1000)
+      .assert.containsText('.view', 'query: "A%"')
+      .click('li:nth-child(9) a')
+      .assert.urlEquals('http://localhost:8080/hash-mode/#/query/A%25')
+      .assert.containsText('.view', 'query: "A%"')
+
       // Listener cleanup
       .assert.containsText('#popstate-count', '1 popstate listeners')
       .click('#unmount')