diff --git a/bleach/linkifier.py b/bleach/linkifier.py
index b3b83e6..343f374 100644
--- a/bleach/linkifier.py
+++ b/bleach/linkifier.py
@@ -147,13 +147,16 @@ class Linker:
         self.parser = html5lib_shim.BleachHTMLParser(
             tags=recognized_tags,
             strip=False,
-            consume_entities=True,
+            consume_entities=False,
             namespaceHTMLElements=False,
         )
         self.walker = html5lib_shim.getTreeWalker("etree")
         self.serializer = html5lib_shim.BleachHTMLSerializer(
             quote_attr_values="always",
             omit_optional_tags=False,
+            # We want to leave entities as they are without escaping or
+            # resolving or expanding
+            resolve_entities=False,
             # linkify does not sanitize
             sanitize=False,
             # linkify preserves attr order
@@ -510,6 +513,62 @@ class LinkifyFilter(html5lib_shim.Filter):
                 yield {"type": "Characters", "data": str(new_text)}
                 yield token_buffer[-1]
 
+    def extract_entities(self, token):
+        """Handles Characters tokens with entities
+
+        Our overridden tokenizer doesn't do anything with entities. However,
+        that means that the serializer will convert all ``&`` in Characters
+        tokens to ``&amp;``.
+
+        Since we don't want that, we extract entities here and convert them to
+        Entity tokens so the serializer will let them be.
+
+        :arg token: the Characters token to work on
+
+        :returns: generator of tokens
+
+        """
+        data = token.get("data", "")
+
+        # If there isn't a & in the data, we can return now
+        if "&" not in data:
+            yield token
+            return
+
+        new_tokens = []
+
+        # For each possible entity that starts with a "&", we try to extract an
+        # actual entity and re-tokenize accordingly
+        for part in html5lib_shim.next_possible_entity(data):
+            if not part:
+                continue
+
+            if part.startswith("&"):
+                entity = html5lib_shim.match_entity(part)
+                if entity is not None:
+                    if entity == "amp":
+                        # LinkifyFilter can't match urls across token boundaries
+                        # which is problematic with &amp; since that shows up in
+                        # querystrings all the time. This special-cases &amp;
+                        # and converts it to a & and sticks it in as a
+                        # Characters token. It'll get merged with surrounding
+                        # tokens in the BleachSanitizerfilter.__iter__ and
+                        # escaped in the serializer.
+                        new_tokens.append({"type": "Characters", "data": "&"})
+                    else:
+                        new_tokens.append({"type": "Entity", "name": entity})
+
+                    # Length of the entity plus 2--one for & at the beginning
+                    # and one for ; at the end
+                    remainder = part[len(entity) + 2 :]
+                    if remainder:
+                        new_tokens.append({"type": "Characters", "data": remainder})
+                    continue
+
+            new_tokens.append({"type": "Characters", "data": part})
+
+        yield from new_tokens
+
     def __iter__(self):
         in_a = False
         in_skip_tag = None
@@ -564,8 +623,8 @@ class LinkifyFilter(html5lib_shim.Filter):
 
                 new_stream = self.handle_links(new_stream)
 
-                for token in new_stream:
-                    yield token
+                for new_token in new_stream:
+                    yield from self.extract_entities(new_token)
 
                 # We've already yielded this token, so continue
                 continue

diff --git a/tests/test_linkify.py b/tests/test_linkify.py
index c05bb30..a6d96e2 100644
--- a/tests/test_linkify.py
+++ b/tests/test_linkify.py
@@ -324,13 +324,17 @@ def test_link_fragment():
     )
 
 
-def test_link_entities():
+def test_link_entities_in_qs():
     assert (
         linkify("http://xx.com/?a=1&b=2")
         == '<a href="http://xx.com/?a=1&amp;b=2" rel="nofollow">http://xx.com/?a=1&amp;b=2</a>'
     )
 
 
+def test_link_entities_in_characters_token():
+    assert linkify("foo &nbsp; bar") == "foo &nbsp; bar"
+
+
 def test_escaped_html():
     """If I pass in escaped HTML, it should probably come out escaped."""
     s = "&lt;em&gt;strong&lt;/em&gt;"

Bug relating to nbsp?
This is with bleach 3.1:
```
>>> import bleach
>>> bleach.clean(u'foo.&nbsp; bar.')
'foo.&nbsp; bar.'
>>> bleach.linkify(u'foo.&nbsp; bar.')
'foo.\xa0 bar.'
```
Odd that `linkify` would convert `&nbsp;` to `\xa0`.  Maybe related to #143?

Seems like a bug but I'd expect that someone else would have come across this already.
tests/test_linkify.py::test_link_entities_in_characters_token
tests/test_linkify.py::test_empty tests/test_linkify.py::test_simple_link tests/test_linkify.py::test_trailing_slash tests/test_linkify.py::test_mangle_link tests/test_linkify.py::test_mangle_text tests/test_linkify.py::test_email_link[a tests/test_linkify.py::test_email_link[aussie tests/test_linkify.py::test_email_link[email tests/test_linkify.py::test_email_link[<br>jinkyun@example.com-True-<br><a tests/test_linkify.py::test_email_link[mailto tests/test_linkify.py::test_email_link["\\\n"@opa.ru-True-"\\\n"@opa.ru] tests/test_linkify.py::test_email_link[gorby%kremvax@example.com-True-<a tests/test_linkify.py::test_email_link[unlikely?address@example.com-True-<a tests/test_linkify.py::test_email_link_escaping["james"@example.com-<a tests/test_linkify.py::test_email_link_escaping["j'ames"@example.com-<a tests/test_linkify.py::test_email_link_escaping["ja>mes"@example.com-<a tests/test_linkify.py::test_prevent_links[callback0-a tests/test_linkify.py::test_prevent_links[callback1-a tests/test_linkify.py::test_prevent_links[callback2-a tests/test_linkify.py::test_prevent_links[callback3-a tests/test_linkify.py::test_prevent_links[callback4-a tests/test_linkify.py::test_prevent_links[callback5-a tests/test_linkify.py::test_set_attrs tests/test_linkify.py::test_only_proto_links tests/test_linkify.py::test_stop_email tests/test_linkify.py::test_tlds[example.com-<a tests/test_linkify.py::test_tlds[example.co-<a tests/test_linkify.py::test_tlds[example.co.uk-<a tests/test_linkify.py::test_tlds[example.edu-<a tests/test_linkify.py::test_tlds[example.xxx-<a tests/test_linkify.py::test_tlds[bit.ly/fun-<a tests/test_linkify.py::test_tlds[example.yyy-example.yyy] tests/test_linkify.py::test_tlds[brie-brie] tests/test_linkify.py::test_escaping[< tests/test_linkify.py::test_escaping[<U tests/test_linkify.py::test_nofollow_off tests/test_linkify.py::test_link_in_html tests/test_linkify.py::test_links_https tests/test_linkify.py::test_add_rel_nofollow tests/test_linkify.py::test_url_with_path tests/test_linkify.py::test_link_ftp tests/test_linkify.py::test_link_query tests/test_linkify.py::test_link_fragment tests/test_linkify.py::test_link_entities_in_qs tests/test_linkify.py::test_escaped_html tests/test_linkify.py::test_link_http_complete tests/test_linkify.py::test_non_url tests/test_linkify.py::test_javascript_url tests/test_linkify.py::test_unsafe_url tests/test_linkify.py::test_skip_tags tests/test_linkify.py::test_libgl tests/test_linkify.py::test_end_of_sentence[example.com-.] tests/test_linkify.py::test_end_of_sentence[example.com-...] tests/test_linkify.py::test_end_of_sentence[ex.com/foo-.] tests/test_linkify.py::test_end_of_sentence[ex.com/foo-....] tests/test_linkify.py::test_end_of_clause tests/test_linkify.py::test_sarcasm tests/test_linkify.py::test_wrapping_parentheses[(example.com)-expected_parts0] tests/test_linkify.py::test_wrapping_parentheses[(example.com/)-expected_parts1] tests/test_linkify.py::test_wrapping_parentheses[(example.com/foo)-expected_parts2] tests/test_linkify.py::test_wrapping_parentheses[(((example.com/))))-expected_parts3] tests/test_linkify.py::test_wrapping_parentheses[example.com/))-expected_parts4] tests/test_linkify.py::test_wrapping_parentheses[(foo tests/test_linkify.py::test_wrapping_parentheses[http://en.wikipedia.org/wiki/Test_(assessment)-expected_parts7] tests/test_linkify.py::test_wrapping_parentheses[(http://en.wikipedia.org/wiki/Test_(assessment))-expected_parts8] tests/test_linkify.py::test_wrapping_parentheses[((http://en.wikipedia.org/wiki/Test_(assessment))-expected_parts9] tests/test_linkify.py::test_wrapping_parentheses[(http://en.wikipedia.org/wiki/Test_(assessment)))-expected_parts10] tests/test_linkify.py::test_wrapping_parentheses[(http://en.wikipedia.org/wiki/)Test_(assessment-expected_parts11] tests/test_linkify.py::test_wrapping_parentheses[hello tests/test_linkify.py::test_parentheses_with_removing tests/test_linkify.py::test_ports[http://foo.com:8000-http://foo.com:8000-] tests/test_linkify.py::test_ports[http://foo.com:8000/-http://foo.com:8000/-] tests/test_linkify.py::test_ports[http://bar.com:xkcd-http://bar.com-:xkcd] tests/test_linkify.py::test_ports[http://foo.com:81/bar-http://foo.com:81/bar-] tests/test_linkify.py::test_ports[http://foo.com:-http://foo.com-:] tests/test_linkify.py::test_ports[http://foo.com:\u0663\u0669/-http://foo.com-:\u0663\u0669/] tests/test_linkify.py::test_ports[http://foo.com:\U0001d7e0\U0001d7d8/-http://foo.com-:\U0001d7e0\U0001d7d8/] tests/test_linkify.py::test_ignore_bad_protocols tests/test_linkify.py::test_link_emails_and_urls tests/test_linkify.py::test_links_case_insensitive tests/test_linkify.py::test_elements_inside_links tests/test_linkify.py::test_drop_link_tags tests/test_linkify.py::test_naughty_unescaping[&lt;br&gt;-&lt;br&gt;] tests/test_linkify.py::test_naughty_unescaping[&lt;br&gt; tests/test_linkify.py::test_hang tests/test_linkify.py::test_hyphen_in_mail tests/test_linkify.py::test_url_re_arg tests/test_linkify.py::test_email_re_arg tests/test_linkify.py::test_recognized_tags_arg tests/test_linkify.py::test_linkify_idempotent[<span>text tests/test_linkify.py::test_linkify_idempotent[a tests/test_linkify.py::test_linkify_idempotent[link tests/test_linkify.py::test_linkify_idempotent[text<em>] tests/test_linkify.py::test_linkify_idempotent[jim tests/test_linkify.py::test_linkify_idempotent[<a tests/test_linkify.py::TestLinkify::test_no_href_links tests/test_linkify.py::TestLinkify::test_rel_already_there tests/test_linkify.py::TestLinkify::test_only_text_is_linkified tests/test_linkify.py::test_linkify_filter[abc-abc] tests/test_linkify.py::test_linkify_filter[example.com-<a tests/test_linkify.py::test_linkify_filter[http://example.com?b=1&c=2-<a tests/test_linkify.py::test_linkify_filter[http://example.com?b=1&amp;c=2-<a tests/test_linkify.py::test_linkify_filter[link: