diff --git a/homeassistant/bootstrap.py b/homeassistant/bootstrap.py
index eb3aa3a2239..445ff35793c 100644
--- a/homeassistant/bootstrap.py
+++ b/homeassistant/bootstrap.py
@@ -245,7 +245,7 @@ async def load_registries(hass: core.HomeAssistant) -> None:
         entity_registry.async_load(hass),
         issue_registry.async_load(hass),
         hass.async_add_executor_job(_cache_uname_processor),
-        template.async_load_custom_jinja(hass),
+        template.async_load_custom_templates(hass),
     )
 
 
diff --git a/homeassistant/components/homeassistant/__init__.py b/homeassistant/components/homeassistant/__init__.py
index 4b033fd7119..91dd742e802 100644
--- a/homeassistant/components/homeassistant/__init__.py
+++ b/homeassistant/components/homeassistant/__init__.py
@@ -30,7 +30,7 @@ from homeassistant.helpers.service import (
     async_extract_referenced_entity_ids,
     async_register_admin_service,
 )
-from homeassistant.helpers.template import async_load_custom_jinja
+from homeassistant.helpers.template import async_load_custom_templates
 from homeassistant.helpers.typing import ConfigType
 
 ATTR_ENTRY_ID = "entry_id"
@@ -39,7 +39,7 @@ _LOGGER = logging.getLogger(__name__)
 DOMAIN = ha.DOMAIN
 SERVICE_RELOAD_CORE_CONFIG = "reload_core_config"
 SERVICE_RELOAD_CONFIG_ENTRY = "reload_config_entry"
-SERVICE_RELOAD_CUSTOM_JINJA = "reload_custom_jinja"
+SERVICE_RELOAD_CUSTOM_TEMPLATES = "reload_custom_templates"
 SERVICE_CHECK_CONFIG = "check_config"
 SERVICE_UPDATE_ENTITY = "update_entity"
 SERVICE_SET_LOCATION = "set_location"
@@ -260,12 +260,12 @@ async def async_setup(hass: ha.HomeAssistant, config: ConfigType) -> bool:  # no
         vol.Schema({ATTR_LATITUDE: cv.latitude, ATTR_LONGITUDE: cv.longitude}),
     )
 
-    async def async_handle_reload_jinja(call: ha.ServiceCall) -> None:
+    async def async_handle_reload_templates(call: ha.ServiceCall) -> None:
         """Service handler to reload custom Jinja."""
-        await async_load_custom_jinja(hass)
+        await async_load_custom_templates(hass)
 
     async_register_admin_service(
-        hass, ha.DOMAIN, SERVICE_RELOAD_CUSTOM_JINJA, async_handle_reload_jinja
+        hass, ha.DOMAIN, SERVICE_RELOAD_CUSTOM_TEMPLATES, async_handle_reload_templates
     )
 
     async def async_handle_reload_config_entry(call: ha.ServiceCall) -> None:
@@ -300,7 +300,7 @@ async def async_setup(hass: ha.HomeAssistant, config: ConfigType) -> bool:  # no
         Additionally, it also calls the `homeasssitant.reload_core_config`
         service, as that reloads the core YAML configuration, the
         `frontend.reload_themes` service that reloads the themes, and the
-        `homeassistant.reload_custom_jinja` service that reloads any custom
+        `homeassistant.reload_custom_templates` service that reloads any custom
         jinja into memory.
 
         We only do so, if there are no configuration errors.
@@ -330,7 +330,7 @@ async def async_setup(hass: ha.HomeAssistant, config: ConfigType) -> bool:  # no
             for domain, service in (
                 (ha.DOMAIN, SERVICE_RELOAD_CORE_CONFIG),
                 ("frontend", "reload_themes"),
-                (ha.DOMAIN, SERVICE_RELOAD_CUSTOM_JINJA),
+                (ha.DOMAIN, SERVICE_RELOAD_CUSTOM_TEMPLATES),
             )
         ]
 
diff --git a/homeassistant/components/homeassistant/services.yaml b/homeassistant/components/homeassistant/services.yaml
index 20f23402a73..2fe27769c3f 100644
--- a/homeassistant/components/homeassistant/services.yaml
+++ b/homeassistant/components/homeassistant/services.yaml
@@ -59,10 +59,10 @@ update_entity:
   target:
     entity: {}
 
-reload_custom_jinja:
+reload_custom_templates:
   name: Reload custom Jinja2 templates
   description: >-
-    Reload Jinja2 templates found in the custom_jinja folder in your config.
+    Reload Jinja2 templates found in the custom_templates folder in your config.
     New values will be applied on the next render of the template.
 
 reload_config_entry:
diff --git a/homeassistant/helpers/template.py b/homeassistant/helpers/template.py
index d3aa7c81ffb..481a59cee85 100644
--- a/homeassistant/helpers/template.py
+++ b/homeassistant/helpers/template.py
@@ -124,7 +124,7 @@ template_cv: ContextVar[tuple[str, str] | None] = ContextVar(
 CACHED_TEMPLATE_STATES = 512
 EVAL_CACHE_SIZE = 512
 
-MAX_CUSTOM_JINJA_SIZE = 5 * 1024 * 1024
+MAX_CUSTOM_TEMPLATE_SIZE = 5 * 1024 * 1024
 
 
 @bind_hass
@@ -2084,18 +2084,18 @@ class LoggingUndefined(jinja2.Undefined):
         return super().__bool__()
 
 
-async def async_load_custom_jinja(hass: HomeAssistant) -> None:
+async def async_load_custom_templates(hass: HomeAssistant) -> None:
     """Load all custom jinja files under 5MiB into memory."""
-    return await hass.async_add_executor_job(_load_custom_jinja, hass)
+    return await hass.async_add_executor_job(_load_custom_templates, hass)
 
 
-def _load_custom_jinja(hass: HomeAssistant) -> None:
+def _load_custom_templates(hass: HomeAssistant) -> None:
     result = {}
-    jinja_path = hass.config.path("custom_jinja")
+    jinja_path = hass.config.path("custom_templates")
     all_files = [
         item
         for item in pathlib.Path(jinja_path).rglob("*.jinja")
-        if item.is_file() and item.stat().st_size <= MAX_CUSTOM_JINJA_SIZE
+        if item.is_file() and item.stat().st_size <= MAX_CUSTOM_TEMPLATE_SIZE
     ]
     for file in all_files:
         content = file.read_text()
diff --git a/tests/components/homeassistant/test_init.py b/tests/components/homeassistant/test_init.py
index 4a042416965..652fc4a1fdd 100644
--- a/tests/components/homeassistant/test_init.py
+++ b/tests/components/homeassistant/test_init.py
@@ -14,7 +14,7 @@ from homeassistant.components.homeassistant import (
     SERVICE_CHECK_CONFIG,
     SERVICE_RELOAD_ALL,
     SERVICE_RELOAD_CORE_CONFIG,
-    SERVICE_RELOAD_CUSTOM_JINJA,
+    SERVICE_RELOAD_CUSTOM_TEMPLATES,
     SERVICE_SET_LOCATION,
 )
 from homeassistant.const import (
@@ -576,19 +576,19 @@ async def test_save_persistent_states(hass: HomeAssistant) -> None:
         assert mock_save.called
 
 
-async def test_reload_custom_jinja(hass: HomeAssistant) -> None:
-    """Test we can call reload_custom_jinja."""
+async def test_reload_custom_templates(hass: HomeAssistant) -> None:
+    """Test we can call reload_custom_templates."""
     await async_setup_component(hass, "homeassistant", {})
     with patch(
-        "homeassistant.components.homeassistant.async_load_custom_jinja",
+        "homeassistant.components.homeassistant.async_load_custom_templates",
         return_value=None,
-    ) as mock_load_custom_jinja:
+    ) as mock_load_custom_templates:
         await hass.services.async_call(
             "homeassistant",
-            SERVICE_RELOAD_CUSTOM_JINJA,
+            SERVICE_RELOAD_CUSTOM_TEMPLATES,
             blocking=True,
         )
-        assert mock_load_custom_jinja.called
+        assert mock_load_custom_templates.called
 
 
 async def test_reload_all(
@@ -602,7 +602,7 @@ async def test_reload_all(
     notify = async_mock_service(hass, "notify", "reload")
     core_config = async_mock_service(hass, "homeassistant", "reload_core_config")
     themes = async_mock_service(hass, "frontend", "reload_themes")
-    jinja = async_mock_service(hass, "homeassistant", "reload_custom_jinja")
+    jinja = async_mock_service(hass, "homeassistant", "reload_custom_templates")
 
     with patch(
         "homeassistant.config.async_check_ha_config_file",
diff --git a/tests/helpers/test_template.py b/tests/helpers/test_template.py
index 45237a5cbf0..b381775f1e1 100644
--- a/tests/helpers/test_template.py
+++ b/tests/helpers/test_template.py
@@ -245,8 +245,8 @@ def test_iterating_domain_states(hass: HomeAssistant) -> None:
 
 
 async def test_import(hass: HomeAssistant) -> None:
-    """Test that imports work from the config/custom_jinja folder."""
-    await template.async_load_custom_jinja(hass)
+    """Test that imports work from the config/custom_templates folder."""
+    await template.async_load_custom_templates(hass)
     assert "test.jinja" in template._get_hass_loader(hass).sources
     assert "inner/inner_test.jinja" in template._get_hass_loader(hass).sources
     assert (
@@ -283,7 +283,7 @@ async def test_import(hass: HomeAssistant) -> None:
 
 async def test_import_change(hass: HomeAssistant) -> None:
     """Test that a change in HassLoader results in updated imports."""
-    await template.async_load_custom_jinja(hass)
+    await template.async_load_custom_templates(hass)
     to_test = template.Template(
         """
         {% import 'test.jinja' as t %}
diff --git a/tests/testing_config/custom_jinja/inner/inner_test.jinja b/tests/testing_config/custom_templates/inner/inner_test.jinja
similarity index 100%
rename from tests/testing_config/custom_jinja/inner/inner_test.jinja
rename to tests/testing_config/custom_templates/inner/inner_test.jinja
diff --git a/tests/testing_config/custom_jinja/test.jinja b/tests/testing_config/custom_templates/test.jinja
similarity index 100%
rename from tests/testing_config/custom_jinja/test.jinja
rename to tests/testing_config/custom_templates/test.jinja