diff --git a/homeassistant/components/template/template_entity.py b/homeassistant/components/template/template_entity.py
index 20b0caec3ca..2e42b28fbd2 100644
--- a/homeassistant/components/template/template_entity.py
+++ b/homeassistant/components/template/template_entity.py
@@ -121,6 +121,7 @@ class TemplateEntity(Entity):
         """Template Entity."""
         self._template_attrs = {}
         self._async_update = None
+        self._async_update_entity_ids_filter = None
         self._attribute_templates = attribute_templates
         self._attributes = {}
         self._availability_template = availability_template
@@ -231,6 +232,9 @@ class TemplateEntity(Entity):
                     event, update.template, update.last_result, update.result
                 )
 
+        if self._async_update_entity_ids_filter:
+            self._async_update_entity_ids_filter({self.entity_id})
+
         if self._async_update:
             self.async_write_ha_state()
 
@@ -245,8 +249,12 @@ class TemplateEntity(Entity):
         )
         self.async_on_remove(result_info.async_remove)
         result_info.async_refresh()
+        result_info.async_update_entity_ids_filter({self.entity_id})
         self.async_write_ha_state()
         self._async_update = result_info.async_refresh
+        self._async_update_entity_ids_filter = (
+            result_info.async_update_entity_ids_filter
+        )
 
     async def async_added_to_hass(self) -> None:
         """Run when entity about to be added to hass."""
diff --git a/homeassistant/helpers/event.py b/homeassistant/helpers/event.py
index dcc05675a01..d9f1b8d9681 100644
--- a/homeassistant/helpers/event.py
+++ b/homeassistant/helpers/event.py
@@ -508,6 +508,7 @@ class _TrackTemplateResultInfo:
         self._info: Dict[Template, RenderInfo] = {}
         self._last_domains: Set = set()
         self._last_entities: Set = set()
+        self._entity_ids_filter: Set = set()
 
     def async_setup(self) -> None:
         """Activation of template tracking."""
@@ -659,12 +660,27 @@ class _TrackTemplateResultInfo:
         """Force recalculate the template."""
         self._refresh(None)
 
+    @callback
+    def async_update_entity_ids_filter(self, entity_ids: Set) -> None:
+        """Update the filtered entity_ids."""
+        self._entity_ids_filter = entity_ids
+
     @callback
     def _refresh(self, event: Optional[Event]) -> None:
         entity_id = event and event.data.get(ATTR_ENTITY_ID)
         updates = []
         info_changed = False
 
+        if entity_id and entity_id in self._entity_ids_filter:
+            # Skip self-referencing updates
+            for track_template_ in self._track_templates:
+                _LOGGER.warning(
+                    "Template loop detected while processing event: %s, skipping template render for Template[%s]",
+                    event,
+                    track_template_.template.template,
+                )
+            return
+
         for track_template_ in self._track_templates:
             template = track_template_.template
             if (
diff --git a/tests/components/template/test_sensor.py b/tests/components/template/test_sensor.py
index 31b298330e8..439f154b4af 100644
--- a/tests/components/template/test_sensor.py
+++ b/tests/components/template/test_sensor.py
@@ -758,3 +758,47 @@ async def test_sun_renders_once_per_sensor(hass):
         "{{ state_attr('sun.sun', 'elevation') }}",
         "{{ state_attr('sun.sun', 'next_rising') }}",
     }
+
+
+async def test_self_referencing_sensor_loop(hass, caplog):
+    """Test a self referencing sensor does not loop forever."""
+
+    template_str = """
+{% for state in states -%}
+  {{ state.last_updated }}
+{%- endfor %}
+"""
+
+    await async_setup_component(
+        hass,
+        "sensor",
+        {
+            "sensor": {
+                "platform": "template",
+                "sensors": {
+                    "test": {
+                        "value_template": template_str,
+                    },
+                },
+            }
+        },
+    )
+
+    await hass.async_block_till_done()
+    await hass.async_start()
+    await hass.async_block_till_done()
+
+    assert len(hass.states.async_all()) == 1
+
+    value = hass.states.get("sensor.test").state
+    await hass.async_block_till_done()
+
+    value2 = hass.states.get("sensor.test").state
+    assert value2 == value
+
+    await hass.async_block_till_done()
+
+    value3 = hass.states.get("sensor.test").state
+    assert value3 == value2
+
+    assert "Template loop detected" in caplog.text