WRONG ALTIMETER SETTING RESULTS IN AN ALTDEV ALT OVERSHOT IN CLB.

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ACFT WAS ON THE FIRST FLT OF THE DAY AFTER MAINT OVERNIGHT. GND OPS WERE NORMAL AND THERE WAS ADEQUATE TIME TO ACCOMPLISH ALL REQUIRED CHKS AND STILL DEPART ON SCHEDULE. CAPT WAS FLYING THE ACFT TO ASSIGNED ALT OF 10000 FT MSL. AT APPROX 7500 FT MSL I REACHED UP TO ADJUST THE AIR CONDITIONING SYS. THE CAPT MADE THE CALL 'OUT OF 9000 FT FOR 10000 FT;' AND I GLANCED AT HIS ALTIMETER. IT WAS PASSING THROUGH 9100 FT. THE ALT ALERT SOUNDED AT 9300 FT AND I FINISHED WITH THE AIR CONDITIONER. I NOTICED MY ALTIMETER NOW INDICATING 10600 FT MSL AS THE DEP CTLR SAID 'OOPS; CALL SIGN XX CLB MAINTAIN 14000 FT.' I LOOKED AT THE CAPT'S ALTIMETER AND IT READ 10000 FT BUT IT WAS SET TO 28.87 INSTEAD OF 29.87. HE CORRECTED HIS SETTING AND THE FLT CONTINUED UNEVENTFULLY. THERE WAS NO TFC CONFLICT. WHAT HAPPENED? MAINT HAD PERFORMED SOME CHKS THE PREVIOUS NIGHT AND HAD SET THE CAPT'S ALTIMETER TO ZERO. DEP FIELD ELEVATION WAS ALMOST EXACTLY 1000 FT MSL WHEN HE SET HIS ALTIMETER TO THE ATIS SETTING. WE BOTH MISSED THE FACT THAT HIS WAS 1000 FT LOW. THE NEEDLE IN HIS ALTIMETER WAS SLIGHTLY R OF 12 O'CLOCK AND MINE WAS SLIGHTLY L OF 12 O'CLOCK. THE DIGIT IN THE 1000 FT DRUM OF BOTH ALTIMETERS WAS ZERO; THE LAST 2 DIGITS OF THE ALTIMETER SETTING WERE CORRECT; THE FIRST DIGIT WAS ALSO CORRECT; THE 2 ALTIMETERS APPEARED TO BE WITHIN TOLERANCES. IN SHORT; EVERYTHING LOOKED RIGHT BUT IT WAS OBVIOUSLY VERY WRONG. THIS WAS A VERY SUBTLE TRAP BUT WE HAD A LOT OF CHANCES TO CATCH IT. I LOOK AT ALTIMETERS A LOT MORE CLOSELY NOW. SUPPLEMENTAL INFO FROM ACN 300049: THE CAPT'S ALTIMETER WAS SET TO ZERO DURING THE NIGHT. LCL ALTIMETER SETTING WAS 29.87. THE ZERO SETTING WAS 28.77. ATL FIELD ELEVATION IS 1027 FT; AND I ALSO MISSED THE 1000 FT POINTER; WHICH WAS ZERO AND SHOULD HAVE BEEN 1000 FT. IF MAINT HAS A PROC CHK THAT REQUIRES SETTING THE ALTIMETER TO ZERO; THE END OF THEIR PROC SHOULD BE TO RESET THE ALTIMETER BACK TO THE LCL ALTIMETER SETTING. ESPECIALLY WHEN THE FIELD ELEVATION IS IN EXACTLY 1000 FT INCREMENTS.