diff --git a/esphome/const.py b/esphome/const.py
index f33b4ee406..35d4b016ce 100644
--- a/esphome/const.py
+++ b/esphome/const.py
@@ -10,7 +10,8 @@ ESP_PLATFORM_ESP32 = "ESP32"
 ESP_PLATFORM_ESP8266 = "ESP8266"
 ESP_PLATFORMS = [ESP_PLATFORM_ESP32, ESP_PLATFORM_ESP8266]
 
-ALLOWED_NAME_CHARS = "abcdefghijklmnopqrstuvwxyz0123456789_-"
+ALLOWED_NAME_CHARS = "abcdefghijklmnopqrstuvwxyz0123456789-_"
+
 # Lookup table from ESP32 arduino framework version to latest platformio
 # package with that version
 # See also https://github.com/platformio/platform-espressif32/releases
diff --git a/esphome/dashboard/static/js/esphome.js b/esphome/dashboard/static/js/esphome.js
index 52dda446ce..e861f169df 100644
--- a/esphome/dashboard/static/js/esphome.js
+++ b/esphome/dashboard/static/js/esphome.js
@@ -1012,6 +1012,10 @@ jQuery.validator.addMethod("nospaces", (value, element) => {
   return value.indexOf(' ') < 0;
 }, "Name cannot contain any spaces!");
 
+jQuery.validator.addMethod("nounderscores", (value, element) => {
+  return value.indexOf('_') < 0;
+}, "Name cannot contain underscores!");
+
 jQuery.validator.addMethod("lowercase", (value, element) => {
   return value === value.toLowerCase();
 }, "Name must be all lower case!");
diff --git a/esphome/dashboard/templates/index.html b/esphome/dashboard/templates/index.html
index 142bc2cd6f..dee10bfc27 100644
--- a/esphome/dashboard/templates/index.html
+++ b/esphome/dashboard/templates/index.html
@@ -359,12 +359,12 @@
                 <p>
                   Names must be all <strong>lowercase</strong> and <strong>must not contain any spaces</strong>!
                   Characters that are allowed are: <code class="inlinecode">a-z</code>,
-                  <code class="inlinecode">0-9</code>, <code class="inlinecode">_</code> and <code class="inlinecode">-</code>.
+                  <code class="inlinecode">0-9</code> and <code class="inlinecode">-</code>.
                 </p>
 
                 <div class="input-field col s12">
                   <input id="node_name" class="validate" type="text" name="name" data-rule-nospaces="true"
-                    data-rule-lowercase="true" required>
+                    data-rule-lowercase="true" data-rule-nounderscores="true" required>
                   <label for="node_name">Node Name</label>
                 </div>
 
diff --git a/esphome/wizard.py b/esphome/wizard.py
index 4ad5c63216..3550e39392 100644
--- a/esphome/wizard.py
+++ b/esphome/wizard.py
@@ -196,11 +196,11 @@ def wizard(path):
                 color(
                     Fore.RED,
                     f'Oh noes, "{name}" isn\'t a valid name. Names can only '
-                    f"include numbers, lower-case letters, underscores and "
-                    f"hyphens.",
+                    f"include numbers, lower-case letters and hyphens. ",
                 )
             )
-            name = strip_accents(name).lower().replace(" ", "_")
+            name = strip_accents(name).lower().replace(" ", "-")
+            name = strip_accents(name).lower().replace("_", "-")
             name = "".join(c for c in name if c in ALLOWED_NAME_CHARS)
             safe_print(
                 'Shall I use "{}" as the name instead?'.format(color(Fore.CYAN, name))
diff --git a/tests/unit_tests/test_config_validation.py b/tests/unit_tests/test_config_validation.py
index 949d4251ee..16cfb16e94 100644
--- a/tests/unit_tests/test_config_validation.py
+++ b/tests/unit_tests/test_config_validation.py
@@ -27,7 +27,7 @@ def test_alphanumeric__invalid(value):
         config_validation.alphanumeric(value)
 
 
-@given(value=text(alphabet=string.ascii_lowercase + string.digits + "_-"))
+@given(value=text(alphabet=string.ascii_lowercase + string.digits + "-_"))
 def test_valid_name__valid(value):
     actual = config_validation.valid_name(value)
 
diff --git a/tests/unit_tests/test_wizard.py b/tests/unit_tests/test_wizard.py
index 6c952608d4..0ca7c83e1b 100644
--- a/tests/unit_tests/test_wizard.py
+++ b/tests/unit_tests/test_wizard.py
@@ -9,7 +9,7 @@ from mock import MagicMock
 @pytest.fixture
 def default_config():
     return {
-        "name": "test_name",
+        "name": "test-name",
         "platform": "test_platform",
         "board": "test_board",
         "ssid": "test_ssid",
@@ -21,7 +21,7 @@ def default_config():
 @pytest.fixture
 def wizard_answers():
     return [
-        "test_node",  # Name of the node
+        "test-node",  # Name of the node
         "ESP8266",  # platform
         "nodemcuv2",  # board
         "SSID",  # ssid
@@ -305,13 +305,14 @@ def test_wizard_offers_better_node_name(tmpdir, monkeypatch, wizard_answers):
     """
     When the node name does not conform, a better alternative is offered
     * Removes special chars
-    * Replaces spaces with underscores
+    * Replaces spaces with hyphens
+    * Replaces underscores with hyphens
     * Converts all uppercase letters to lowercase
     """
 
     # Given
-    wizard_answers[0] = "Küche #2"
-    expected_name = "kuche_2"
+    wizard_answers[0] = "Küche_Unten #2"
+    expected_name = "kuche-unten-2"
     monkeypatch.setattr(
         wz, "default_input", MagicMock(side_effect=lambda _, default: default)
     )