diff --git a/homeassistant/helpers/template.py b/homeassistant/helpers/template.py
index 39317d873f5..bc18a26368d 100644
--- a/homeassistant/helpers/template.py
+++ b/homeassistant/helpers/template.py
@@ -30,6 +30,7 @@ from homeassistant.const import (
 from homeassistant.core import State, callback, split_entity_id, valid_entity_id
 from homeassistant.exceptions import TemplateError
 from homeassistant.helpers import config_validation as cv, location as loc_helper
+from homeassistant.helpers.frame import report
 from homeassistant.helpers.typing import HomeAssistantType, TemplateVarsType
 from homeassistant.loader import bind_hass
 from homeassistant.util import convert, dt as dt_util, location as loc_util
@@ -98,6 +99,11 @@ def extract_entities(
     variables: TemplateVarsType = None,
 ) -> Union[str, List[str]]:
     """Extract all entities for state_changed listener from template string."""
+
+    report(
+        "called template.extract_entities. Please use event.async_track_template_result instead as it can accurately handle watching entities"
+    )
+
     if template is None or not is_template_string(template):
         return []
 
diff --git a/tests/helpers/test_template.py b/tests/helpers/test_template.py
index 74cd19a165d..9d8b763c275 100644
--- a/tests/helpers/test_template.py
+++ b/tests/helpers/test_template.py
@@ -20,7 +20,14 @@ from homeassistant.helpers import template
 import homeassistant.util.dt as dt_util
 from homeassistant.util.unit_system import UnitSystem
 
-from tests.async_mock import patch
+from tests.async_mock import Mock, patch
+
+
+@pytest.fixture()
+def allow_extract_entities():
+    """Allow extract entities."""
+    with patch("homeassistant.helpers.template.report"):
+        yield
 
 
 def _set_up_units(hass):
@@ -1758,7 +1765,7 @@ def test_closest_function_no_location_states(hass):
     )
 
 
-def test_extract_entities_none_exclude_stuff(hass):
+def test_extract_entities_none_exclude_stuff(hass, allow_extract_entities):
     """Test extract entities function with none or exclude stuff."""
     assert template.extract_entities(hass, None) == []
 
@@ -1780,7 +1787,7 @@ def test_extract_entities_none_exclude_stuff(hass):
     )
 
 
-def test_extract_entities_no_match_entities(hass):
+def test_extract_entities_no_match_entities(hass, allow_extract_entities):
     """Test extract entities function with none entities stuff."""
     assert (
         template.extract_entities(
@@ -1920,7 +1927,7 @@ async def test_async_render_to_info_in_conditional(hass):
     assert_result_info(info, "oink", ["sensor.xyz", "sensor.pig"], [])
 
 
-async def test_extract_entities_match_entities(hass):
+async def test_extract_entities_match_entities(hass, allow_extract_entities):
     """Test extract entities function with entities stuff."""
     assert (
         template.extract_entities(
@@ -2028,7 +2035,7 @@ states.sensor.pick_humidity.state ~ " %"
     ]
 
 
-def test_extract_entities_with_variables(hass):
+def test_extract_entities_with_variables(hass, allow_extract_entities):
     """Test extract entities function with variables and entities stuff."""
     hass.states.async_set("input_boolean.switch", "on")
     assert ["input_boolean.switch"] == template.extract_entities(
@@ -2063,7 +2070,7 @@ def test_extract_entities_with_variables(hass):
     )
 
 
-def test_extract_entities_domain_states_inner(hass):
+def test_extract_entities_domain_states_inner(hass, allow_extract_entities):
     """Test extract entities function by domain."""
     hass.states.async_set("light.switch", "on")
     hass.states.async_set("light.switch2", "on")
@@ -2078,7 +2085,7 @@ def test_extract_entities_domain_states_inner(hass):
     ) == {"light.switch", "light.switch2", "light.switch3"}
 
 
-def test_extract_entities_domain_states_outer(hass):
+def test_extract_entities_domain_states_outer(hass, allow_extract_entities):
     """Test extract entities function by domain."""
     hass.states.async_set("light.switch", "on")
     hass.states.async_set("light.switch2", "on")
@@ -2093,7 +2100,7 @@ def test_extract_entities_domain_states_outer(hass):
     ) == {"light.switch", "light.switch2", "light.switch3"}
 
 
-def test_extract_entities_domain_states_outer_with_group(hass):
+def test_extract_entities_domain_states_outer_with_group(hass, allow_extract_entities):
     """Test extract entities function by domain."""
     hass.states.async_set("light.switch", "on")
     hass.states.async_set("light.switch2", "on")
@@ -2110,6 +2117,43 @@ def test_extract_entities_domain_states_outer_with_group(hass):
     ) == {"light.switch", "light.switch2", "light.switch3", "group.lights"}
 
 
+def test_extract_entities_blocked_from_core_code(hass):
+    """Test extract entities is blocked from core code."""
+    with pytest.raises(RuntimeError):
+        template.extract_entities(
+            hass, "{{ states.light }}", {},
+        )
+
+
+def test_extract_entities_warns_and_logs_from_an_integration(hass, caplog):
+    """Test extract entities works from a custom_components with a log message."""
+
+    correct_frame = Mock(
+        filename="/config/custom_components/burncpu/light.py",
+        lineno="23",
+        line="self.light.is_on",
+    )
+    with patch(
+        "homeassistant.helpers.frame.extract_stack",
+        return_value=[
+            Mock(
+                filename="/home/dev/homeassistant/core.py",
+                lineno="23",
+                line="do_something()",
+            ),
+            correct_frame,
+            Mock(filename="/home/dev/mdns/lights.py", lineno="2", line="something()",),
+        ],
+    ):
+        template.extract_entities(
+            hass, "{{ states.light }}", {},
+        )
+
+    assert "custom_components/burncpu/light.py" in caplog.text
+    assert "23" in caplog.text
+    assert "self.light.is_on" in caplog.text
+
+
 def test_jinja_namespace(hass):
     """Test Jinja's namespace command can be used."""
     test_template = template.Template(