diff --git a/homeassistant/components/mqtt/abbreviations.py b/homeassistant/components/mqtt/abbreviations.py
index 8664027e245..cc1f86d285a 100644
--- a/homeassistant/components/mqtt/abbreviations.py
+++ b/homeassistant/components/mqtt/abbreviations.py
@@ -214,6 +214,7 @@ ABBREVIATIONS = {
     "stat_val_tpl": "state_value_template",
     "step": "step",
     "stype": "subtype",
+    "sug_dsp_prc": "suggested_display_precision",
     "sup_dur": "support_duration",
     "sup_vol": "support_volume_set",
     "sup_feat": "supported_features",
diff --git a/homeassistant/components/mqtt/sensor.py b/homeassistant/components/mqtt/sensor.py
index 33c1b9d9fb8..1a8c59ff86e 100644
--- a/homeassistant/components/mqtt/sensor.py
+++ b/homeassistant/components/mqtt/sensor.py
@@ -60,6 +60,7 @@ _LOGGER = logging.getLogger(__name__)
 CONF_EXPIRE_AFTER = "expire_after"
 CONF_LAST_RESET_TOPIC = "last_reset_topic"
 CONF_LAST_RESET_VALUE_TEMPLATE = "last_reset_value_template"
+CONF_SUGGESTED_DISPLAY_PRECISION = "suggested_display_precision"
 
 MQTT_SENSOR_ATTRIBUTES_BLOCKED = frozenset(
     {
@@ -104,6 +105,7 @@ _PLATFORM_SCHEMA_BASE = MQTT_RO_SCHEMA.extend(
         vol.Optional(CONF_LAST_RESET_TOPIC): valid_subscribe_topic,
         vol.Optional(CONF_LAST_RESET_VALUE_TEMPLATE): cv.template,
         vol.Optional(CONF_NAME, default=DEFAULT_NAME): cv.string,
+        vol.Optional(CONF_SUGGESTED_DISPLAY_PRECISION): cv.positive_int,
         vol.Optional(CONF_STATE_CLASS): vol.Any(STATE_CLASSES_SCHEMA, None),
         vol.Optional(CONF_UNIT_OF_MEASUREMENT): cv.string,
     }
@@ -226,6 +228,9 @@ class MqttSensor(MqttEntity, RestoreSensor):
         """(Re)Setup the entity."""
         self._attr_device_class = config.get(CONF_DEVICE_CLASS)
         self._attr_force_update = config[CONF_FORCE_UPDATE]
+        self._attr_suggested_display_precision = config.get(
+            CONF_SUGGESTED_DISPLAY_PRECISION
+        )
         self._attr_native_unit_of_measurement = config.get(CONF_UNIT_OF_MEASUREMENT)
         self._attr_state_class = config.get(CONF_STATE_CLASS)
 
diff --git a/tests/components/mqtt/test_sensor.py b/tests/components/mqtt/test_sensor.py
index 1262643253b..ad32773ac5d 100644
--- a/tests/components/mqtt/test_sensor.py
+++ b/tests/components/mqtt/test_sensor.py
@@ -92,6 +92,7 @@ async def test_setting_sensor_value_via_mqtt_message(
                     "name": "test",
                     "state_topic": "test-topic",
                     "unit_of_measurement": "fav unit",
+                    "suggested_display_precision": 1,
                 }
             }
         },
@@ -99,10 +100,12 @@ async def test_setting_sensor_value_via_mqtt_message(
     await hass.async_block_till_done()
     await mqtt_mock_entry_with_yaml_config()
 
-    async_fire_mqtt_message(hass, "test-topic", "100")
+    async_fire_mqtt_message(hass, "test-topic", "100.22")
     state = hass.states.get("sensor.test")
 
-    assert state.state == "100"
+    # Rounding happens at the frontend
+    # the state should show the received value
+    assert state.state == "100.22"
     assert state.attributes.get("unit_of_measurement") == "fav unit"