diff --git a/django/conf/project_template/project_name/settings.py b/django/conf/project_template/project_name/settings.py
index c0db27cbdc..3eaf05cfc0 100644
--- a/django/conf/project_template/project_name/settings.py
+++ b/django/conf/project_template/project_name/settings.py
@@ -25,8 +25,6 @@ SECRET_KEY = '{{ secret_key }}'
 # SECURITY WARNING: don't run with debug turned on in production!
 DEBUG = True
 
-TEMPLATE_DEBUG = True
-
 ALLOWED_HOSTS = []
 
 
diff --git a/django/template/backends/django.py b/django/template/backends/django.py
index 65c65bdeee..5940c0b457 100644
--- a/django/template/backends/django.py
+++ b/django/template/backends/django.py
@@ -18,7 +18,7 @@ class DjangoTemplates(BaseEngine):
     def __init__(self, params):
         params = params.copy()
         options = params.pop('OPTIONS').copy()
-        options.setdefault('debug', settings.TEMPLATE_DEBUG)
+        options.setdefault('debug', settings.DEBUG)
         options.setdefault('file_charset', settings.FILE_CHARSET)
         super(DjangoTemplates, self).__init__(params)
         self.engine = Engine(self.dirs, self.app_dirs, **options)
diff --git a/django/template/defaulttags.py b/django/template/defaulttags.py
index a75248332c..da68ec6a66 100644
--- a/django/template/defaulttags.py
+++ b/django/template/defaulttags.py
@@ -209,8 +209,8 @@ class ForNode(Node):
                         context.update(unpacked_vars)
                 else:
                     context[self.loopvars[0]] = item
-                # In TEMPLATE_DEBUG mode provide source of the node which
-                # actually raised the exception
+                # In debug mode provide the source of the node which raised
+                # the exception
                 if context.engine.debug:
                     for node in self.nodelist_loop:
                         try:
diff --git a/django/template/utils.py b/django/template/utils.py
index f9b322fea9..8bfa9d4f0e 100644
--- a/django/template/utils.py
+++ b/django/template/utils.py
@@ -42,6 +42,7 @@ class EngineHandler(object):
                     'OPTIONS': {
                         'allowed_include_roots': settings.ALLOWED_INCLUDE_ROOTS,
                         'context_processors': settings.TEMPLATE_CONTEXT_PROCESSORS,
+                        'debug': settings.TEMPLATE_DEBUG,
                         'loaders': settings.TEMPLATE_LOADERS,
                         'string_if_invalid': settings.TEMPLATE_STRING_IF_INVALID,
                     },
diff --git a/django/test/signals.py b/django/test/signals.py
index d2bb209dbf..0c2bf5201c 100644
--- a/django/test/signals.py
+++ b/django/test/signals.py
@@ -93,6 +93,7 @@ def reset_template_engines(**kwargs):
         'TEMPLATE_DEBUG',
         'TEMPLATE_LOADERS',
         'TEMPLATE_STRING_IF_INVALID',
+        'DEBUG',
         'FILE_CHARSET',
         'INSTALLED_APPS',
     }:
diff --git a/docs/howto/custom-template-tags.txt b/docs/howto/custom-template-tags.txt
index e4fe6949ea..463c3bbfe5 100644
--- a/docs/howto/custom-template-tags.txt
+++ b/docs/howto/custom-template-tags.txt
@@ -756,10 +756,9 @@ Notes:
 * The ``render()`` method is where the work actually happens.
 
 * ``render()`` should generally fail silently, particularly in a production
-  environment where :setting:`DEBUG` and :setting:`TEMPLATE_DEBUG` are
-  ``False``. In some cases however, particularly if :setting:`TEMPLATE_DEBUG` is
-  ``True``, this method may raise an exception to make debugging easier. For
-  example, several core tags raise ``django.template.TemplateSyntaxError``
+  environment. In some cases however, particularly if ``context.engine.debug``
+  is ``True``, this method may raise an exception to make debugging easier.
+  For example, several core tags raise ``django.template.TemplateSyntaxError``
   if they receive the wrong number or type of arguments.
 
 Ultimately, this decoupling of compilation and rendering results in an
diff --git a/docs/internals/deprecation.txt b/docs/internals/deprecation.txt
index 66477109ec..0bb3b39c20 100644
--- a/docs/internals/deprecation.txt
+++ b/docs/internals/deprecation.txt
@@ -116,6 +116,7 @@ details on these changes.
 
   * ``ALLOWED_INCLUDE_ROOTS``
   * ``TEMPLATE_CONTEXT_PROCESSORS``
+  * ``TEMPLATE_DEBUG``
   * ``TEMPLATE_DIRS``
   * ``TEMPLATE_LOADERS``
   * ``TEMPLATE_STRING_IF_INVALID``
diff --git a/docs/ref/settings.txt b/docs/ref/settings.txt
index 0218a6ef58..6db21f179d 100644
--- a/docs/ref/settings.txt
+++ b/docs/ref/settings.txt
@@ -2250,6 +2250,11 @@ TEMPLATE_DEBUG
 
 Default: ``False``
 
+.. deprecated:: 1.8
+
+    Set the ``'debug'`` option in the :setting:`OPTIONS <TEMPLATES-OPTIONS>`
+    of a ``DjangoTemplates`` backend instead.
+
 A boolean that turns on/off template debug mode. If this is ``True``, the fancy
 error page will display a detailed report for any exception raised during
 template rendering. This report contains the relevant snippet of the template,
diff --git a/docs/ref/templates/api.txt b/docs/ref/templates/api.txt
index 0355fb59ed..07dd2f1bb1 100644
--- a/docs/ref/templates/api.txt
+++ b/docs/ref/templates/api.txt
@@ -936,7 +936,7 @@ Template origin
 When an :class:`~django.template.Engine` is initialized with ``debug=True``,
 its templates have an ``origin`` attribute depending on the source they are
 loaded from. For engines initialized by Django, ``debug`` defaults to the
-value of :setting:`TEMPLATE_DEBUG`.
+value of :setting:`DEBUG`.
 
 .. class:: loader.LoaderOrigin
 
diff --git a/docs/ref/templates/upgrading.txt b/docs/ref/templates/upgrading.txt
index 02588175d6..b2ef23c4b8 100644
--- a/docs/ref/templates/upgrading.txt
+++ b/docs/ref/templates/upgrading.txt
@@ -10,7 +10,7 @@ The :setting:`TEMPLATES` settings
 =================================
 
 A new setting was introduced in Django 1.8: :setting:`TEMPLATES`. All existing
-template-related settings except :setting:`TEMPLATE_DEBUG` were deprecated.
+template-related settings were deprecated.
 
 During the deprecation period, Django will create a backwards-compatible
 :setting:`TEMPLATES` based on the ``TEMPLATE_*`` settings if you don't define
@@ -85,9 +85,13 @@ If your settings module defines ``ALLOWED_INCLUDE_ROOTS`` or
 ``'allowed_include_roots'`` and ``'string_if_invalid'`` keys in the
 ``'OPTIONS'`` dictionary.
 
+If it sets ``TEMPLATE_DEBUG`` to a value that differs from :setting:`DEBUG`,
+include that value under the ``'debug'`` key in ``'OPTIONS'``.
+
 Once you have defined :setting:`TEMPLATES`, you can safely remove
-``ALLOWED_INCLUDE_ROOTS``, ``TEMPLATE_CONTEXT_PROCESSORS``, ``TEMPLATE_DIRS``,
-``TEMPLATE_LOADERS``, and ``TEMPLATE_STRING_IF_INVALID``.
+``ALLOWED_INCLUDE_ROOTS``, ``TEMPLATE_CONTEXT_PROCESSORS``,
+``TEMPLATE_DEBUG``, ``TEMPLATE_DIRS``, ``TEMPLATE_LOADERS``, and
+``TEMPLATE_STRING_IF_INVALID``.
 
 If you are overriding some of these settings in tests, you should override the
 entire :setting:`TEMPLATES` setting instead.
diff --git a/docs/releases/1.4.txt b/docs/releases/1.4.txt
index 0917ce6ee0..6f1bf09beb 100644
--- a/docs/releases/1.4.txt
+++ b/docs/releases/1.4.txt
@@ -437,7 +437,7 @@ For example:
 No wrapping of exceptions in ``TEMPLATE_DEBUG`` mode
 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
 
-In previous versions of Django, whenever the :setting:`TEMPLATE_DEBUG` setting
+In previous versions of Django, whenever the ``TEMPLATE_DEBUG`` setting
 was ``True``, any exception raised during template rendering (even exceptions
 unrelated to template syntax) were wrapped in ``TemplateSyntaxError`` and
 re-raised. This was done in order to provide detailed template source location
@@ -446,7 +446,7 @@ information in the debug 500 page.
 In Django 1.4, exceptions are no longer wrapped. Instead, the original
 exception is annotated with the source information. This means that catching
 exceptions from template rendering is now consistent regardless of the value of
-:setting:`TEMPLATE_DEBUG`, and there's no need to catch and unwrap
+``TEMPLATE_DEBUG``, and there's no need to catch and unwrap
 ``TemplateSyntaxError`` in order to catch other errors.
 
 ``truncatechars`` template filter
diff --git a/docs/releases/1.7.txt b/docs/releases/1.7.txt
index bb3ba41a91..498afdaf3f 100644
--- a/docs/releases/1.7.txt
+++ b/docs/releases/1.7.txt
@@ -845,7 +845,7 @@ Templates
 * It is now possible to :ttag:`include` templates recursively.
 
 * Template objects now have an origin attribute set when
-  :setting:`TEMPLATE_DEBUG` is ``True``. This allows template origins to be
+  ``TEMPLATE_DEBUG`` is ``True``. This allows template origins to be
   inspected and logged outside of the ``django.template`` infrastructure.
 
 * ``TypeError`` exceptions are no longer silenced when raised during the
diff --git a/docs/releases/1.8.txt b/docs/releases/1.8.txt
index b3dd2f6381..720d590317 100644
--- a/docs/releases/1.8.txt
+++ b/docs/releases/1.8.txt
@@ -1263,6 +1263,7 @@ are deprecated in favor of :setting:`TEMPLATES`:
 
 * ``ALLOWED_INCLUDE_ROOTS``
 * ``TEMPLATE_CONTEXT_PROCESSORS``
+* ``TEMPLATE_DEBUG``
 * ``TEMPLATE_DIRS``
 * ``TEMPLATE_LOADERS``
 * ``TEMPLATE_STRING_IF_INVALID``
diff --git a/docs/topics/settings.txt b/docs/topics/settings.txt
index e84b344e53..bf6a7a75d5 100644
--- a/docs/topics/settings.txt
+++ b/docs/topics/settings.txt
@@ -188,7 +188,7 @@ Example::
 
     from django.conf import settings
 
-    settings.configure(DEBUG=True, TEMPLATE_DEBUG=True)
+    settings.configure(DEBUG=True)
 
 Pass ``configure()`` as many keyword arguments as you'd like, with each keyword
 argument representing a setting and its value. Each argument name should be all
diff --git a/docs/topics/templates.txt b/docs/topics/templates.txt
index 0b01ea53c2..036c006035 100644
--- a/docs/topics/templates.txt
+++ b/docs/topics/templates.txt
@@ -356,9 +356,7 @@ applications. This generic name was kept for backwards-compatibility.
   exception raised during template rendering. This report contains the
   relevant snippet of the template with the appropriate line highlighted.
 
-  It defaults to the value of the :setting:`TEMPLATE_DEBUG` setting. The
-  setting is convenient for toggling template debug mode globally rather than
-  on a per-engine basis.
+  It defaults to the value of the :setting:`DEBUG` setting.
 
 * ``'loaders'``: a list of dotted Python paths to template loader classes.
   Each ``Loader`` class knows how to import templates from a particular
diff --git a/tests/generic_inline_admin/tests.py b/tests/generic_inline_admin/tests.py
index d76e58bf3b..91883e1170 100644
--- a/tests/generic_inline_admin/tests.py
+++ b/tests/generic_inline_admin/tests.py
@@ -15,11 +15,13 @@ from .admin import MediaInline, MediaPermanentInline, site as admin_site
 from .models import Category, Episode, EpisodePermanent, Media
 
 
-# Set TEMPLATE_DEBUG to True to ensure {% include %} will raise exceptions.
+# Set DEBUG to True to ensure {% include %} will raise exceptions.
 # That is how inlines are rendered and #9498 will bubble up if it is an issue.
-@override_settings(PASSWORD_HASHERS=['django.contrib.auth.hashers.SHA1PasswordHasher'],
-                   TEMPLATE_DEBUG=True,
-                   ROOT_URLCONF="generic_inline_admin.urls")
+@override_settings(
+    DEBUG=True,
+    PASSWORD_HASHERS=['django.contrib.auth.hashers.SHA1PasswordHasher'],
+    ROOT_URLCONF="generic_inline_admin.urls",
+)
 class GenericAdminViewTest(TestCase):
     fixtures = ['users.xml']
 
diff --git a/tests/template_tests/test_nodelist.py b/tests/template_tests/test_nodelist.py
index 836d1b6db9..49e09833ed 100644
--- a/tests/template_tests/test_nodelist.py
+++ b/tests/template_tests/test_nodelist.py
@@ -33,7 +33,7 @@ class ErrorIndexTest(TestCase):
     Checks whether index of error is calculated correctly in
     template debugger in for loops. Refs ticket #5831
     """
-    @override_settings(DEBUG=True, TEMPLATE_DEBUG=True)
+    @override_settings(DEBUG=True)
     def test_correct_exception_index(self):
         tests = [
             ('{% load bad_tag %}{% for i in range %}{% badsimpletag %}{% endfor %}', (38, 56)),
diff --git a/tests/template_tests/test_parser.py b/tests/template_tests/test_parser.py
index 1e1d76b1bd..5d9a3a374e 100644
--- a/tests/template_tests/test_parser.py
+++ b/tests/template_tests/test_parser.py
@@ -89,7 +89,7 @@ class ParserTests(TestCase):
         with six.assertRaisesRegex(self, TypeError, "Variable must be a string or number, got <(class|type) 'dict'>"):
             Variable({})
 
-    @override_settings(DEBUG=True, TEMPLATE_DEBUG=True)
+    @override_settings(DEBUG=True)
     def test_compile_filter_error(self):
         # regression test for #19819
         msg = "Could not parse the remainder: '@bar' from 'foo@bar'"
diff --git a/tests/template_tests/tests.py b/tests/template_tests/tests.py
index ffc3064b41..cf37e1868b 100644
--- a/tests/template_tests/tests.py
+++ b/tests/template_tests/tests.py
@@ -85,10 +85,12 @@ class TemplateLoaderTests(SimpleTestCase):
     @override_settings(TEMPLATES=[{
         'BACKEND': 'django.template.backends.django.DjangoTemplates',
         'DIRS': [TEMPLATES_DIR],
+        'OPTIONS': {
+            # Turn DEBUG on, so that the origin file name will be kept with
+            # the compiled templates.
+            'debug': True,
+        }
     }])
-    # Turn TEMPLATE_DEBUG on, so that the origin file name will be kept with
-    # the compiled templates.
-    @override_settings(TEMPLATE_DEBUG=True)
     def test_loader_debug_origin(self):
         load_name = 'login.html'
 
@@ -104,6 +106,7 @@ class TemplateLoaderTests(SimpleTestCase):
         'BACKEND': 'django.template.backends.django.DjangoTemplates',
         'DIRS': [TEMPLATES_DIR],
         'OPTIONS': {
+            'debug': True,
             'loaders': [
                 ('django.template.loaders.cached.Loader', [
                     'django.template.loaders.filesystem.Loader',
@@ -111,7 +114,6 @@ class TemplateLoaderTests(SimpleTestCase):
             ],
         },
     }])
-    @override_settings(TEMPLATE_DEBUG=True)
     def test_cached_loader_debug_origin(self):
         load_name = 'login.html'
 
@@ -126,12 +128,12 @@ class TemplateLoaderTests(SimpleTestCase):
         self.assertTrue(template_name.endswith(load_name),
             'Cached template loaded through cached loader has incorrect name for debug page: %s' % template_name)
 
-    @override_settings(TEMPLATE_DEBUG=True)
+    @override_settings(DEBUG=True)
     def test_loader_origin(self):
         template = loader.get_template('login.html')
         self.assertEqual(template.origin.loadname, 'login.html')
 
-    @override_settings(TEMPLATE_DEBUG=True)
+    @override_settings(DEBUG=True)
     def test_string_origin(self):
         template = Template('string template')
         self.assertEqual(template.origin.source, 'string template')
@@ -140,15 +142,17 @@ class TemplateLoaderTests(SimpleTestCase):
         template = loader.get_template('login.html')
         self.assertEqual(template.origin, None)
 
-    # TEMPLATE_DEBUG must be true, otherwise the exception raised
-    # during {% include %} processing will be suppressed.
-    @override_settings(TEMPLATE_DEBUG=True)
     # Test the base loader class via the app loader. load_template
     # from base is used by all shipped loaders excepting cached,
     # which has its own test.
     @override_settings(TEMPLATES=[{
         'BACKEND': 'django.template.backends.django.DjangoTemplates',
         'APP_DIRS': True,
+        'OPTIONS': {
+            # Enable debug, otherwise the exception raised during
+            # {% include %} processing will be suppressed.
+            'debug': True,
+        }
     }])
     def test_include_missing_template(self):
         """
@@ -164,15 +168,17 @@ class TemplateLoaderTests(SimpleTestCase):
             self.assertEqual(e.args[0], 'missing.html')
         self.assertEqual(r, None, 'Template rendering unexpectedly succeeded, produced: ->%r<-' % r)
 
-    # TEMPLATE_DEBUG must be true, otherwise the exception raised
-    # during {% include %} processing will be suppressed.
-    @override_settings(TEMPLATE_DEBUG=True)
     # Test the base loader class via the app loader. load_template
     # from base is used by all shipped loaders excepting cached,
     # which has its own test.
     @override_settings(TEMPLATES=[{
         'BACKEND': 'django.template.backends.django.DjangoTemplates',
         'APP_DIRS': True,
+        'OPTIONS': {
+            # Enable debug, otherwise the exception raised during
+            # {% include %} processing will be suppressed.
+            'debug': True,
+        }
     }])
     def test_extends_include_missing_baseloader(self):
         """
@@ -193,6 +199,7 @@ class TemplateLoaderTests(SimpleTestCase):
     @override_settings(TEMPLATES=[{
         'BACKEND': 'django.template.backends.django.DjangoTemplates',
         'OPTIONS': {
+            'debug': True,
             'loaders': [
                 ('django.template.loaders.cached.Loader', [
                     'django.template.loaders.app_directories.Loader',
@@ -200,7 +207,6 @@ class TemplateLoaderTests(SimpleTestCase):
             ],
         },
     }])
-    @override_settings(TEMPLATE_DEBUG=True)
     def test_extends_include_missing_cachedloader(self):
         """
         Same as test_extends_include_missing_baseloader, only tests
@@ -235,19 +241,28 @@ class TemplateLoaderTests(SimpleTestCase):
         output = outer_tmpl.render(ctx)
         self.assertEqual(output, 'This worked!')
 
-    @override_settings(TEMPLATE_DEBUG=True)
+    @override_settings(TEMPLATES=[{
+        'BACKEND': 'django.template.backends.django.DjangoTemplates',
+        'OPTIONS': {
+            'debug': True,
+        },
+    }])
     def test_include_immediate_missing(self):
         """
-        Regression test for #16417 -- {% include %} tag raises TemplateDoesNotExist at compile time if TEMPLATE_DEBUG is True
-
         Test that an {% include %} tag with a literal string referencing a
         template that does not exist does not raise an exception at parse
-        time.
+        time. Regression test for #16417.
         """
         tmpl = Template('{% include "this_does_not_exist.html" %}')
         self.assertIsInstance(tmpl, Template)
 
-    @override_settings(TEMPLATE_DEBUG=True)
+    @override_settings(TEMPLATES=[{
+        'BACKEND': 'django.template.backends.django.DjangoTemplates',
+        'APP_DIRS': True,
+        'OPTIONS': {
+            'debug': True,
+        },
+    }])
     def test_include_recursive(self):
         comments = [
             {
@@ -277,7 +292,7 @@ class TemplateRegressionTests(SimpleTestCase):
         split = token.split_contents()
         self.assertEqual(split, ["sometag", '_("Page not found")', 'value|yesno:_("yes,no")'])
 
-    @override_settings(SETTINGS_MODULE=None, TEMPLATE_DEBUG=True)
+    @override_settings(SETTINGS_MODULE=None, DEBUG=True)
     def test_url_reverse_no_settings_module(self):
         # Regression test for #9005
         t = Template('{% url will_not_match %}')
@@ -307,7 +322,7 @@ class TemplateRegressionTests(SimpleTestCase):
             self.assertGreater(depth, 5,
                 "The traceback context was lost when reraising the traceback. See #19827")
 
-    @override_settings(DEBUG=True, TEMPLATE_DEBUG=True)
+    @override_settings(DEBUG=True)
     def test_no_wrapped_exception(self):
         """
         The template system doesn't wrap exceptions, but annotates them.
diff --git a/tests/view_tests/tests/test_debug.py b/tests/view_tests/tests/test_debug.py
index 547b96ffc3..a31fb187ee 100644
--- a/tests/view_tests/tests/test_debug.py
+++ b/tests/view_tests/tests/test_debug.py
@@ -44,8 +44,7 @@ class CallableSettingWrapperTests(TestCase):
         self.assertEqual(actual, "repr from the wrapped callable")
 
 
-@override_settings(DEBUG=True, TEMPLATE_DEBUG=True,
-                   ROOT_URLCONF="view_tests.urls")
+@override_settings(DEBUG=True, ROOT_URLCONF="view_tests.urls")
 class DebugViewTests(TestCase):
 
     def test_files(self):