If you encounter an error such as, for example (replace "B6 with the character byte that fails for you, e.g. "93)

\lst@eaten ->-

Invalid UTF-8 byte sequence "B6

here is the reason and fix.

Reason: UTF-8 encoding is not read by listings package.

Fix: explicitly set the UTF-8 characters to the values readable by LaTeX, such as:

\lstset{%
        literate=%
            {~}{{$\neg$}}1 %               \neg, logical not
            {<=}{{\tiny$\leq$}}1 %         \leq
            {>=}{{\tiny$\geq$}}1 %         \geq
            {~=}{{\tiny$\neq$}}1 %         \neq, not equal
            {delta}{{\tiny$\Delta$}}1 %    \Delta
            {µ}{{$\mu$}}1 %                \mu
            % Allow for German characters in lstlistings.
            {Ö}{{\"O}}1
            {Ä}{{\"A}}1
            {Ü}{{\"U}}1
            {ß}{{\ss}}2
            {ü}{{\"u}}1
            {ä}{{\"a}}1
            {ö}{{\"o}}1
            {–}{\textendash}2
            {—}{\textemdash}2
            {(end)}{\lstbasicfont (end)}{5} % black ``end'' when indexing last vector element
            {({ }end)}{\lstbasicfont ({ }end)}{6}
            {(end{ })}{\lstbasicfont (end{ })}{6}
            {({ }end{ })}{\lstbasicfont ({ }end{ })}{7}
            {:end}{\lstbasicfont :end}{4}
            {:{ }end}{\lstbasicfont :{ }end}{5}
            {end:}{\lstbasicfont end:}{4}
            {end{ }:}{\lstbasicfont end{ }:}{5}
            {,end}{\lstbasicfont ,end}{4}
            {,{ }end}{\lstbasicfont ,{ }end}{5}
    }

If your are using mcode.sty, you can simply add this code. As of today, the relevant lines to change are around line number 239.