diff --git a/Lib/pdb.py b/Lib/pdb.py
--- a/Lib/pdb.py
+++ b/Lib/pdb.py
@@ -134,6 +134,8 @@
 
 class Pdb(bdb.Bdb, cmd.Cmd):
 
+    _previous_sigint_handler = None
+
     def __init__(self, completekey='tab', stdin=None, stdout=None, skip=None,
                  nosigint=False):
         bdb.Bdb.__init__(self, skip=skip)
@@ -187,8 +189,17 @@
         self.message("\nProgram interrupted. (Use 'cont' to resume).")
         self.set_step()
         self.set_trace(frame)
-        # restore previous signal handler
-        signal.signal(signal.SIGINT, self._previous_sigint_handler)
+
+    def set_sigint_handler(self):
+        if not self.nosigint:
+            try:
+                Pdb._previous_sigint_handler = \
+                    signal.signal(signal.SIGINT, self.sigint_handler)
+            except ValueError:
+                # ValueError happens when set_sigint_handler() is invoked from
+                # a non-main thread. Would printing a message here (once) make
+                # sense?
+                pass
 
     def reset(self):
         bdb.Bdb.reset(self)
@@ -337,6 +348,9 @@
                                  (expr, newvalue, oldvalue))
 
     def interaction(self, frame, traceback):
+        # restore previous signal handler
+        if self._previous_sigint_handler:
+            signal.signal(signal.SIGINT, self._previous_sigint_handler)
         if self.setup(frame, traceback):
             # no interaction desired at this time (happens if .pdbrc contains
             # a command like "continue")
@@ -1035,16 +1049,7 @@
         """c(ont(inue))
         Continue execution, only stop when a breakpoint is encountered.
         """
-        if not self.nosigint:
-            try:
-                self._previous_sigint_handler = \
-                    signal.signal(signal.SIGINT, self.sigint_handler)
-            except ValueError:
-                # ValueError happens when do_continue() is invoked from
-                # a non-main thread in which case we just continue without
-                # SIGINT set. Would printing a message here (once) make
-                # sense?
-                pass
+        self.set_sigint_handler()
         self.set_continue()
         return 1
     do_c = do_cont = do_continue
diff --git a/Lib/test/test_pdb.py b/Lib/test/test_pdb.py
--- a/Lib/test/test_pdb.py
+++ b/Lib/test/test_pdb.py
@@ -905,6 +905,46 @@
     (Pdb) continue
     """
 
+def test_pdb_issue_20766():
+    """Testing for reference leaks when setting SIGINT handler.
+
+    >>> def set_trace():
+    ...     import sys, pdb
+    ...     pdbinst = pdb.Pdb()
+    ...     pdbinst.set_trace(sys._getframe().f_back)
+    ...     return pdbinst
+
+    >>> def foo(prev_pdbinst):
+    ...     import gc
+    ...     pdbinst = set_trace();
+    ...     gc.collect()
+    ...     references = gc.get_referents(pdbinst._previous_sigint_handler)
+    ...     print(references)
+    ...     if prev_pdbinst and prev_pdbinst not in references:
+    ...         print('self._previous_sigint_handler does not refer to the'
+    ...               ' previous Pdb instance.')
+    ...     return pdbinst
+
+    >>> def test_function():
+    ...     i = 2
+    ...     pdbinst = None
+    ...     while i:
+    ...         i -= 1
+    ...         pdbinst = foo(pdbinst)
+
+    >>> with PdbTestInput(['continue',
+    ...                    'continue']):
+    ...     test_function()
+    > <doctest test.test_pdb.test_pdb_issue_20766[1]>(4)foo()
+    -> gc.collect()
+    (Pdb) continue
+    [<module '_signal' (built-in)>, '_signal']
+    > <doctest test.test_pdb.test_pdb_issue_20766[1]>(4)foo()
+    -> gc.collect()
+    (Pdb) continue
+    [<module '_signal' (built-in)>, '_signal']
+    self._previous_sigint_handler does not refer to the previous Pdb instance.
+    """
 
 class PdbTestCase(unittest.TestCase):