diff --git a/tensorflow_transform/tf_metadata/schema_utils.py b/tensorflow_transform/tf_metadata/schema_utils.py
index 1d1fb981..3d49b519 100644
--- a/tensorflow_transform/tf_metadata/schema_utils.py
+++ b/tensorflow_transform/tf_metadata/schema_utils.py
@@ -262,7 +262,16 @@ def _standardize_default_value(
   assert isinstance(default_value, list), spec.default_value
   # Convert bytes to string
   if spec.dtype == tf.string:
-    default_value = [value.decode('utf-8') for value in default_value]
+
+    # Handle bytes string by trying to decode them (for legacy backwards
+    # compatibility) and if failed, keep the default value as bytes.
+    def try_decode(value: bytes) -> Union[str, bytes]:
+      try:
+        return value.decode('utf-8')
+      except UnicodeError:
+        return value
+
+    default_value = [try_decode(value) for value in default_value]
   # Unwrap a list with a single element.
   if len(default_value) == 1:
     default_value = default_value[0]
diff --git a/tensorflow_transform/tf_metadata/schema_utils_test_cases.py b/tensorflow_transform/tf_metadata/schema_utils_test_cases.py
index abab79ed..902873ce 100644
--- a/tensorflow_transform/tf_metadata/schema_utils_test_cases.py
+++ b/tensorflow_transform/tf_metadata/schema_utils_test_cases.py
@@ -753,6 +753,35 @@
             'seq_string_feature': schema_pb2.StringDomain(value=['a', 'b'])
         }
     },
+    {
+        'testcase_name': 'fixed_len_bytes_encoding',
+        'ascii_proto': """
+          feature {
+            name: "x"
+            type: BYTES
+            value_count {
+              min: 1
+              max: 1
+            }
+          }
+          tensor_representation_group {
+            key: ""
+            value {
+              tensor_representation {
+                key: "x"
+                value {
+                  dense_tensor {
+                    column_name: "x"
+                    shape { dim { size: 1 } }
+                    default_value { bytes_value: "\\xd0" }
+                  }
+                }
+              }
+            }
+          }
+          """,
+        'feature_spec': {'x': tf.io.FixedLenFeature([1], tf.string, b'\xd0')},
+    },
 ]
 
 INVALID_SCHEMA_PROTOS = [