diff --git a/Lib/os.py b/Lib/os.py
index 586238334a4..864edfd48e0 100644
--- a/Lib/os.py
+++ b/Lib/os.py
@@ -152,8 +152,20 @@ def makedirs(name, mode=0o777, exist_ok=False):
         mkdir(name, mode)
     except OSError as e:
         import stat as st
-        if not (e.errno == errno.EEXIST and exist_ok and path.isdir(name) and
-                st.S_IMODE(lstat(name).st_mode) == _get_masked_mode(mode)):
+        dir_exists = path.isdir(name)
+        expected_mode = _get_masked_mode(mode)
+        if dir_exists:
+            # S_ISGID is automatically copied by the OS from parent to child
+            # directories on mkdir.  Don't consider it being set to be a mode
+            # mismatch as mkdir does not unset it when not specified in mode.
+            actual_mode = st.S_IMODE(lstat(name).st_mode) & ~st.S_ISGID
+        else:
+            actual_mode = -1
+        if not (e.errno == errno.EEXIST and exist_ok and dir_exists and
+                actual_mode == expected_mode):
+            if dir_exists and actual_mode != expected_mode:
+                e.strerror += ' (mode %o != expected mode %o)' % (
+                        actual_mode, expected_mode)
             raise
 
 def removedirs(name):
diff --git a/Lib/test/test_os.py b/Lib/test/test_os.py
index 8bc8ba9fa62..605d2a4632f 100644
--- a/Lib/test/test_os.py
+++ b/Lib/test/test_os.py
@@ -15,6 +15,7 @@ from test import support
 import contextlib
 import mmap
 import uuid
+import stat
 from test.script_helper import assert_python_ok
 
 # Detect whether we're on a Linux system that uses the (now outdated
@@ -574,12 +575,39 @@ class MakedirTests(unittest.TestCase):
         path = os.path.join(support.TESTFN, 'dir1')
         mode = 0o777
         old_mask = os.umask(0o022)
-        os.makedirs(path, mode)
-        self.assertRaises(OSError, os.makedirs, path, mode)
-        self.assertRaises(OSError, os.makedirs, path, mode, exist_ok=False)
-        self.assertRaises(OSError, os.makedirs, path, 0o776, exist_ok=True)
-        os.makedirs(path, mode=mode, exist_ok=True)
-        os.umask(old_mask)
+        try:
+            os.makedirs(path, mode)
+            self.assertRaises(OSError, os.makedirs, path, mode)
+            self.assertRaises(OSError, os.makedirs, path, mode, exist_ok=False)
+            self.assertRaises(OSError, os.makedirs, path, 0o776, exist_ok=True)
+            os.makedirs(path, mode=mode, exist_ok=True)
+        finally:
+            os.umask(old_mask)
+
+    def test_exist_ok_s_isgid_directory(self):
+        path = os.path.join(support.TESTFN, 'dir1')
+        S_ISGID = stat.S_ISGID
+        mode = 0o777
+        old_mask = os.umask(0o022)
+        try:
+            existing_testfn_mode = stat.S_IMODE(
+                    os.lstat(support.TESTFN).st_mode)
+            os.chmod(support.TESTFN, existing_testfn_mode | S_ISGID)
+            if (os.lstat(support.TESTFN).st_mode & S_ISGID != S_ISGID):
+                raise unittest.SkipTest('No support for S_ISGID dir mode.')
+            # The os should apply S_ISGID from the parent dir for us, but
+            # this test need not depend on that behavior.  Be explicit.
+            os.makedirs(path, mode | S_ISGID)
+            # http://bugs.python.org/issue14992
+            # Should not fail when the bit is already set.
+            os.makedirs(path, mode, exist_ok=True)
+            # remove the bit.
+            os.chmod(path, stat.S_IMODE(os.lstat(path).st_mode) & ~S_ISGID)
+            with self.assertRaises(OSError):
+                # Should fail when the bit is not already set when demanded.
+                os.makedirs(path, mode | S_ISGID, exist_ok=True)
+        finally:
+            os.umask(old_mask)
 
     def test_exist_ok_existing_regular_file(self):
         base = support.TESTFN
diff --git a/Misc/NEWS b/Misc/NEWS
index 3f99773e8a6..62c1312cdda 100644
--- a/Misc/NEWS
+++ b/Misc/NEWS
@@ -10,6 +10,11 @@ What's New in Python 3.2.4
 Core and Builtins
 -----------------
 
+- Issue #14992: os.makedirs(path, exist_ok=True) would raise an OSError
+  when the path existed and had the S_ISGID mode bit set when it was
+  not explicitly asked for.  This is no longer an exception as mkdir
+  cannot control if the OS sets that bit for it or not.
+
 - Issue #14775: Fix a potential quadratic dict build-up due to the garbage
   collector repeatedly trying to untrack dicts.