diff --git a/CHANGELOG.md b/CHANGELOG.md
index e5f25414..c6f814ec 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -14,6 +14,7 @@ project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0.html).
 - `set_key` and `unset_key` no longer leave a `.tmp_*` file behind on Windows when writing a read-only `.env` fails, and the error raised is the one from the failed write rather than from cleaning up the temporary file by [@MohammedAlkindi] in [#686]
 - `load_dotenv`, `dotenv_values`, `get_key`, `set_key`, `unset_key` and the CLI `--file` option now expand a leading `~` to the user's home directory by [@veeceey] in [#615]
 - `find_dotenv` and the IPython `%dotenv` magic now expand a leading `~` in the file name by [@theskumar] in [#714]
+- Reading a `.env` file no longer rewrites a carriage return inside a value to `\n`, so a value written by `set_key` round-trips byte-for-byte and reading a path agrees with reading the same bytes from a stream by [@Sreekant13] in [#724]
 
 ## [1.2.4] - 2026-10-01
 
@@ -467,6 +468,7 @@ os.PathLike]` instead of just `os.PathLike` (#347 by [@bbc2]).
 [#700]: https://github.com/theskumar/python-dotenv/pull/700
 [#711]: https://github.com/theskumar/python-dotenv/pull/711
 [#714]: https://github.com/theskumar/python-dotenv/pull/714
+[#724]: https://github.com/theskumar/python-dotenv/pull/724
 [790c5c0]: https://github.com/theskumar/python-dotenv/commit/790c5c02991100aa1bf41ee5330aca75edc51311
 
 <!-- contributors -->
@@ -518,6 +520,7 @@ os.PathLike]` instead of just `os.PathLike` (#347 by [@bbc2]).
 [@sammck]: https://github.com/sammck
 [@samwyma]: https://github.com/samwyma
 [@ShamikOfficial]: https://github.com/ShamikOfficial
+[@Sreekant13]: https://github.com/Sreekant13
 [@sidharth-sudhir]: https://github.com/sidharth-sudhir
 [@snobu]: https://github.com/snobu
 [@techalchemy]: https://github.com/techalchemy
diff --git a/src/dotenv/main.py b/src/dotenv/main.py
index 5faa7f0e..5635a60c 100644
--- a/src/dotenv/main.py
+++ b/src/dotenv/main.py
@@ -64,7 +64,12 @@ def __init__(
     @contextmanager
     def _get_stream(self) -> Iterator[IO[str]]:
         if self.dotenv_path and _is_file_or_fifo(self.dotenv_path):
-            with open(self.dotenv_path, encoding=self.encoding) as stream:
+            # newline="" disables universal newline translation so that a
+            # carriage return inside a (quoted) value is not rewritten to "\n"
+            # before parsing. The parser handles CRLF, CR and LF line endings
+            # itself, so reading a path now matches reading the same bytes from
+            # a stream.
+            with open(self.dotenv_path, encoding=self.encoding, newline="") as stream:
                 yield stream
         elif self.stream is not None:
             yield self.stream
@@ -168,7 +173,10 @@ def rewrite(
         path = os.path.realpath(path)
 
     try:
-        source: IO[str] = open(path, encoding=encoding)
+        # newline="" preserves the exact bytes of untouched lines (and of any
+        # carriage return inside a value) instead of letting universal-newline
+        # translation rewrite them before they are echoed back out.
+        source: IO[str] = open(path, encoding=encoding, newline="")
         try:
             path_stat = os.lstat(path)
             original_mode: Optional[int] = (
@@ -187,6 +195,7 @@ def rewrite(
         temp_file = tempfile.NamedTemporaryFile(
             mode="w",
             encoding=encoding,
+            newline="",
             delete=False,
             prefix=".tmp_",
             dir=os.path.dirname(os.path.abspath(path)),
diff --git a/tests/test_main.py b/tests/test_main.py
index 930ab171..d491ad30 100644
--- a/tests/test_main.py
+++ b/tests/test_main.py
@@ -71,6 +71,12 @@ def test_set_key(dotenv_path, before, key, value, expected, after):
         "a\\nb",
         "plain",
         "",
+        # A real newline or carriage return in the value must survive the
+        # write/read file round-trip and not be rewritten by universal-newline
+        # translation (a lone "\r" used to be read back as "\n").
+        "a\nb",
+        "a\rb",
+        "a\r\nb",
     ],
 )
 def test_set_key_round_trips(dotenv_path, value):