diff --git a/esphome/__main__.py b/esphome/__main__.py
index cf2741dbdb..bddac1de02 100644
--- a/esphome/__main__.py
+++ b/esphome/__main__.py
@@ -740,6 +740,14 @@ def parse_args(argv):
     options_parser.add_argument(
         "-q", "--quiet", help="Disable all ESPHome logs.", action="store_true"
     )
+    options_parser.add_argument(
+        "-l",
+        "--log-level",
+        help="Set the log level.",
+        default=os.getenv("ESPHOME_LOG_LEVEL", "INFO"),
+        action="store",
+        choices=["DEBUG", "INFO", "WARNING", "ERROR", "CRITICAL"],
+    )
     options_parser.add_argument(
         "--dashboard", help=argparse.SUPPRESS, action="store_true"
     )
@@ -969,11 +977,16 @@ def run_esphome(argv):
     args = parse_args(argv)
     CORE.dashboard = args.dashboard
 
+    # Override log level if verbose is set
+    if args.verbose:
+        args.log_level = "DEBUG"
+    elif args.quiet:
+        args.log_level = "CRITICAL"
+
     setup_log(
-        args.verbose,
-        args.quiet,
+        log_level=args.log_level,
         # Show timestamp for dashboard access logs
-        args.command == "dashboard",
+        include_timestamp=args.command == "dashboard",
     )
 
     if args.command in PRE_CONFIG_ACTIONS:
diff --git a/esphome/dashboard/web_server.py b/esphome/dashboard/web_server.py
index 40f93db31d..e4b7b8d342 100644
--- a/esphome/dashboard/web_server.py
+++ b/esphome/dashboard/web_server.py
@@ -52,8 +52,6 @@ if TYPE_CHECKING:
     from requests import Response
 
 
-LOG_LEVEL = os.getenv("ESPHOME_LOG_LEVEL", "INFO").upper()
-logging.getLogger().setLevel(LOG_LEVEL)
 _LOGGER = logging.getLogger(__name__)
 
 ENV_DEV = "ESPHOME_DASHBOARD_DEV"
diff --git a/esphome/log.py b/esphome/log.py
index 23dc453d32..0dbb107e31 100644
--- a/esphome/log.py
+++ b/esphome/log.py
@@ -1,4 +1,5 @@
 import logging
+import os
 
 from esphome.core import CORE
 
@@ -67,20 +68,18 @@ class ESPHomeLogFormatter(logging.Formatter):
 
 
 def setup_log(
-    debug: bool = False, quiet: bool = False, include_timestamp: bool = False
+    log_level = logging.INFO,
+    include_timestamp: bool = False,
 ) -> None:
     import colorama
 
     colorama.init()
 
-    if debug:
-        log_level = logging.DEBUG
+    if log_level == logging.DEBUG:
         CORE.verbose = True
-    elif quiet:
-        log_level = logging.CRITICAL
+    elif log_level == logging.CRITICAL:
         CORE.quiet = True
-    else:
-        log_level = logging.INFO
+
     logging.basicConfig(level=log_level)
 
     logging.getLogger("urllib3").setLevel(logging.WARNING)