diff --git a/Lib/smtpd.py b/Lib/smtpd.py
index ff86e7d2065..732066ef9a5 100755
--- a/Lib/smtpd.py
+++ b/Lib/smtpd.py
@@ -137,8 +137,8 @@ class SMTPChannel(asynchat.async_chat):
         self.enable_SMTPUTF8 = enable_SMTPUTF8
         if enable_SMTPUTF8:
             if decode_data:
-                ValueError("decode_data and enable_SMTPUTF8 cannot be set to"
-                           " True at the same time")
+                raise ValueError("decode_data and enable_SMTPUTF8 cannot"
+                                 " be set to True at the same time")
             decode_data = False
         if decode_data is None:
             warn("The decode_data default of True will change to False in 3.6;"
diff --git a/Lib/test/test_smtpd.py b/Lib/test/test_smtpd.py
index 1aa55d21440..88dbfdf6f01 100644
--- a/Lib/test/test_smtpd.py
+++ b/Lib/test/test_smtpd.py
@@ -313,6 +313,12 @@ class SMTPDChannelTest(unittest.TestCase):
             DummyDispatcherBroken, BrokenDummyServer,
             (support.HOST, 0), ('b', 0), decode_data=True)
 
+    def test_decode_data_and_enable_SMTPUTF8_raises(self):
+        self.assertRaises(
+            ValueError, smtpd.SMTPChannel,
+            self.server, self.channel.conn, self.channel.addr,
+            enable_SMTPUTF8=True, decode_data=True)
+
     def test_server_accept(self):
         self.server.handle_accept()
 
diff --git a/Misc/NEWS b/Misc/NEWS
index 9a7a85ae030..293d551f465 100644
--- a/Misc/NEWS
+++ b/Misc/NEWS
@@ -48,6 +48,9 @@ Core and Builtins
 Library
 -------
 
+- Issue #25328: smtpd's SMTPChannel now correctly raises a ValueError if both
+  decode_data and enable_SMTPUTF8 are set to true.
+
 - Issue #16099: RobotFileParser now supports Crawl-delay and Request-rate
   extensions.  Patch by Nikolay Bogoychev.