diff --git a/homeassistant/components/esphome/entity.py b/homeassistant/components/esphome/entity.py
index b28decc7c70..313785fd2df 100644
--- a/homeassistant/components/esphome/entity.py
+++ b/homeassistant/components/esphome/entity.py
@@ -198,6 +198,7 @@ class EsphomeEntity(Entity, Generic[_InfoT, _StateT]):
     """Define a base esphome entity."""
 
     _attr_should_poll = False
+    _attr_has_entity_name = True
     _static_info: _InfoT
     _state: _StateT
     _has_state: bool
@@ -223,24 +224,6 @@ class EsphomeEntity(Entity, Generic[_InfoT, _StateT]):
         self._attr_device_info = DeviceInfo(
             connections={(dr.CONNECTION_NETWORK_MAC, device_info.mac_address)}
         )
-        #
-        # If `friendly_name` is set, we use the Friendly naming rules, if
-        # `friendly_name` is not set we make an exception to the naming rules for
-        # backwards compatibility and use the Legacy naming rules.
-        #
-        # Friendly naming
-        # - Friendly name is prepended to entity names
-        # - Device Name is prepended to entity ids
-        # - Entity id is constructed from device name and object id
-        #
-        # Legacy naming
-        # - Device name is not prepended to entity names
-        # - Device name is not prepended to entity ids
-        # - Entity id is constructed from entity name
-        #
-        if not device_info.friendly_name:
-            return
-        self._attr_has_entity_name = True
         self.entity_id = f"{domain}.{device_info.name}_{entity_info.object_id}"
 
     async def async_added_to_hass(self) -> None:
diff --git a/homeassistant/components/esphome/manager.py b/homeassistant/components/esphome/manager.py
index 62963178a8e..c173a3ada63 100644
--- a/homeassistant/components/esphome/manager.py
+++ b/homeassistant/components/esphome/manager.py
@@ -520,6 +520,15 @@ class ESPHomeManager:
         if device_info.name:
             reconnect_logic.name = device_info.name
 
+        if not device_info.friendly_name:
+            _LOGGER.info(
+                "No `friendly_name` set in the `esphome:` section of the "
+                "YAML config for device '%s' (MAC: %s); It's recommended "
+                "to add one for easier identification and better alignment "
+                "with Home Assistant naming conventions",
+                device_info.name,
+                device_mac,
+            )
         self.device_id = _async_setup_device_registry(hass, entry, entry_data)
 
         entry_data.async_update_device_state()
@@ -756,7 +765,7 @@ def _async_setup_device_registry(
         config_entry_id=entry.entry_id,
         configuration_url=configuration_url,
         connections={(dr.CONNECTION_NETWORK_MAC, device_info.mac_address)},
-        name=entry_data.friendly_name,
+        name=entry_data.friendly_name or entry_data.name,
         manufacturer=manufacturer,
         model=model,
         sw_version=sw_version,
diff --git a/tests/components/esphome/test_entity.py b/tests/components/esphome/test_entity.py
index 977ec50ab30..5c82337e71b 100644
--- a/tests/components/esphome/test_entity.py
+++ b/tests/components/esphome/test_entity.py
@@ -500,6 +500,6 @@ async def test_esphome_device_without_friendly_name(
         states=states,
         device_info={"friendly_name": None},
     )
-    state = hass.states.get("binary_sensor.my_binary_sensor")
+    state = hass.states.get("binary_sensor.test_mybinary_sensor")
     assert state is not None
     assert state.state == STATE_ON
diff --git a/tests/components/esphome/test_manager.py b/tests/components/esphome/test_manager.py
index c897377f719..a4cef909fcc 100644
--- a/tests/components/esphome/test_manager.py
+++ b/tests/components/esphome/test_manager.py
@@ -1577,3 +1577,51 @@ async def test_entry_missing_bluetooth_mac_address(
     )
     await hass.async_block_till_done()
     assert entry.data[CONF_BLUETOOTH_MAC_ADDRESS] == "AA:BB:CC:DD:EE:FC"
+
+
+async def test_device_adds_friendly_name(
+    hass: HomeAssistant,
+    mock_client: APIClient,
+    mock_esphome_device: Callable[
+        [APIClient, list[EntityInfo], list[UserService], list[EntityState]],
+        Awaitable[MockESPHomeDevice],
+    ],
+    caplog: pytest.LogCaptureFixture,
+) -> None:
+    """Test a device with user services that change arguments."""
+    entity_info = []
+    states = []
+    device: MockESPHomeDevice = await mock_esphome_device(
+        mock_client=mock_client,
+        entity_info=entity_info,
+        user_service=[],
+        device_info={"name": "nofriendlyname", "friendly_name": ""},
+        states=states,
+    )
+    await hass.async_block_till_done()
+    dev_reg = dr.async_get(hass)
+    dev = dev_reg.async_get_device(
+        connections={(dr.CONNECTION_NETWORK_MAC, device.entry.unique_id)}
+    )
+    assert dev.name == "Nofriendlyname"
+    assert (
+        "No `friendly_name` set in the `esphome:` section of "
+        "the YAML config for device 'nofriendlyname'"
+    ) in caplog.text
+    caplog.clear()
+
+    await device.mock_disconnect(True)
+    await hass.async_block_till_done()
+    device.device_info = DeviceInfo(
+        **{**device.device_info.to_dict(), "friendly_name": "I have a friendly name"}
+    )
+    mock_client.device_info = AsyncMock(return_value=device.device_info)
+    await device.mock_connect()
+    await hass.async_block_till_done()
+    dev = dev_reg.async_get_device(
+        connections={(dr.CONNECTION_NETWORK_MAC, device.entry.unique_id)}
+    )
+    assert dev.name == "I have a friendly name"
+    assert (
+        "No `friendly_name` set in the `esphome:` section of the YAML config for device"
+    ) not in caplog.text