diff --git a/homeassistant/helpers/template.py b/homeassistant/helpers/template.py
index 85ee1e28309..0b48c78aa0d 100644
--- a/homeassistant/helpers/template.py
+++ b/homeassistant/helpers/template.py
@@ -938,17 +938,15 @@ class AllStates:
     def __call__(
         self,
         entity_id: str,
-        rounded: bool | object = _SENTINEL,
+        rounded: bool = True,
         with_unit: bool = False,
     ) -> str:
         """Return the states."""
         state = _get_state(self._hass, entity_id)
         if state is None:
             return STATE_UNKNOWN
-        if rounded is _SENTINEL:
-            rounded = with_unit
         if rounded or with_unit:
-            return state.format_state(rounded, with_unit)  # type: ignore[arg-type]
+            return state.format_state(rounded, with_unit)
         return state.state
 
     def __repr__(self) -> str:
diff --git a/tests/helpers/test_template.py b/tests/helpers/test_template.py
index 82b6434cf3f..0e6bc852e31 100644
--- a/tests/helpers/test_template.py
+++ b/tests/helpers/test_template.py
@@ -5183,7 +5183,7 @@ def test_state_with_unit_and_rounding(
 
     assert tpl.async_render() == "23.02 beers"
     assert tpl2.async_render() == "23.015 beers"
-    assert tpl3.async_render() == 23.015
+    assert tpl3.async_render() == 23.02
     assert tpl4.async_render() == 23.015
     assert tpl5.async_render() == "23.02 beers"
     assert tpl6.async_render() == "23.015 beers"