It's explained clearly at https://mega.co.nz/#blog_3 https://mega.co.nz/#blog_3 "Fact #1: Once this feature is activated [deduplication], chunk MACs will indee

It's explained clearly at https://mega.co.nz/#blog_3 https://mega.co.nz/#blog_3 "Fact #1: Once this feature is activated [deduplication], chunk MACs will indeed be stored on the server side, but they will of course be encrypted (and we will not use ECB!). Fact #2: MEGA indeed uses deduplication, but it does so based on the entire file post-encryption rather than on blocks pre-encryption. If the same file is uploaded twice, encrypted with the same random 128-bit key, only one copy is stored on the server. Or, if (and this is much more likely!) a file is copied between folders or user accounts through the file manager or the API, all copies point to the same physical file." So no, they don't know that two different users upload the same file, unless the key used for encryption is the same, which is almost impossible in practice.