diff --git a/extensions/vscode-api-tests/src/singlefolder-tests/terminal.test.ts b/extensions/vscode-api-tests/src/singlefolder-tests/terminal.test.ts
index 01232a99c8c..2939dc0e17f 100644
--- a/extensions/vscode-api-tests/src/singlefolder-tests/terminal.test.ts
+++ b/extensions/vscode-api-tests/src/singlefolder-tests/terminal.test.ts
@@ -3,7 +3,7 @@
  *  Licensed under the MIT License. See License.txt in the project root for license information.
  *--------------------------------------------------------------------------------------------*/
 
-import { window, Pseudoterminal, EventEmitter, TerminalDimensions, workspace, ConfigurationTarget, Disposable, UIKind, env, EnvironmentVariableMutatorType, EnvironmentVariableMutator, extensions, ExtensionContext, TerminalOptions, ExtensionTerminalOptions } from 'vscode';
+import { window, Pseudoterminal, EventEmitter, TerminalDimensions, workspace, ConfigurationTarget, Disposable, UIKind, env, EnvironmentVariableMutatorType, EnvironmentVariableMutator, extensions, ExtensionContext, TerminalOptions, ExtensionTerminalOptions, commands } from 'vscode';
 import { doesNotThrow, equal, ok, deepEqual, throws } from 'assert';
 
 // Disable terminal tests:
@@ -284,6 +284,35 @@ import { doesNotThrow, equal, ok, deepEqual, throws } from 'assert';
 		// 	terminal1.show();
 		// });
 
+		test('onDidChangeTerminalName event fires when terminal name is changed', (done) => {
+			disposables.push(window.onDidOpenTerminal(term => {
+				try {
+					equal(term.name, 'foo');
+				} catch (e) {
+					done(e);
+					return;
+				}
+				disposables.push(window.onDidChangeTerminalName(t => {
+					try {
+						equal(t.name, 'bar');
+					} catch (e) {
+						done(e);
+						return;
+					}
+					disposables.push(window.onDidCloseTerminal(() => done()));
+					terminal.dispose();
+				}));
+			}));
+			const pty: Pseudoterminal = {
+				onDidWrite: new EventEmitter<string>().event,
+				open: async () => {
+					await commands.executeCommand('workbench.action.terminal.renameWithArg', { name: 'bar' });
+				},
+				close: () => { }
+			};
+			const terminal = window.createTerminal({ name: 'foo', pty });
+		});
+
 		suite('hideFromUser', () => {
 			test('should be available to terminals API', done => {
 				const terminal = window.createTerminal({ name: 'bg', hideFromUser: true });
diff --git a/src/vs/vscode.proposed.d.ts b/src/vs/vscode.proposed.d.ts
index 0aa96cf73e5..c350e9a4f94 100644
--- a/src/vs/vscode.proposed.d.ts
+++ b/src/vs/vscode.proposed.d.ts
@@ -877,6 +877,17 @@ declare module 'vscode' {
 
 	//#endregion
 
+	//#region Terminal name change event https://github.com/microsoft/vscode/issues/114898
+
+	export namespace window {
+		/**
+		 * An event which fires when the name of the terminal changes.
+		 */
+		export const onDidChangeTerminalName: Event<Terminal>;
+	}
+
+	//#endregion
+
 	// eslint-disable-next-line vscode-dts-region-comments
 	//#region @jrieken -> exclusive document filters
 
diff --git a/src/vs/workbench/api/common/extHost.api.impl.ts b/src/vs/workbench/api/common/extHost.api.impl.ts
index 2da02381a46..a8271f4ad01 100644
--- a/src/vs/workbench/api/common/extHost.api.impl.ts
+++ b/src/vs/workbench/api/common/extHost.api.impl.ts
@@ -540,6 +540,10 @@ export function createApiFactoryAndRegisterActors(accessor: ServicesAccessor): I
 				checkProposedApiEnabled(extension);
 				return extHostTerminalService.onDidWriteTerminalData(listener, thisArg, disposables);
 			},
+			onDidChangeTerminalName(listener, thisArg?, disposables?) {
+				checkProposedApiEnabled(extension);
+				return extHostTerminalService.onDidChangeTerminalName(listener, thisArg, disposables);
+			},
 			get state() {
 				return extHostWindow.state;
 			},
diff --git a/src/vs/workbench/api/common/extHostTerminalService.ts b/src/vs/workbench/api/common/extHostTerminalService.ts
index f684dbb85b4..a23a8e8674b 100644
--- a/src/vs/workbench/api/common/extHostTerminalService.ts
+++ b/src/vs/workbench/api/common/extHostTerminalService.ts
@@ -34,6 +34,7 @@ export interface IExtHostTerminalService extends ExtHostTerminalServiceShape, ID
 	onDidChangeActiveTerminal: Event<vscode.Terminal | undefined>;
 	onDidChangeTerminalDimensions: Event<vscode.TerminalDimensionsChangeEvent>;
 	onDidWriteTerminalData: Event<vscode.TerminalDataWriteEvent>;
+	onDidChangeTerminalName: Event<vscode.Terminal>;
 
 	createTerminal(name?: string, shellPath?: string, shellArgs?: string[] | string): vscode.Terminal;
 	createTerminalFromOptions(options: vscode.TerminalOptions, isFeatureTerminal?: boolean): vscode.Terminal;
@@ -297,6 +298,8 @@ export abstract class BaseExtHostTerminalService extends Disposable implements I
 	public get onDidChangeTerminalDimensions(): Event<vscode.TerminalDimensionsChangeEvent> { return this._onDidChangeTerminalDimensions && this._onDidChangeTerminalDimensions.event; }
 	protected readonly _onDidWriteTerminalData: Emitter<vscode.TerminalDataWriteEvent>;
 	public get onDidWriteTerminalData(): Event<vscode.TerminalDataWriteEvent> { return this._onDidWriteTerminalData && this._onDidWriteTerminalData.event; }
+	protected readonly _onDidChangeTerminalName: Emitter<vscode.Terminal> = new Emitter<vscode.Terminal>();
+	public get onDidChangeTerminalName(): Event<vscode.Terminal> { return this._onDidChangeTerminalName && this._onDidChangeTerminalName.event; }
 
 	constructor(
 		supportsProcesses: boolean,
@@ -395,7 +398,11 @@ export abstract class BaseExtHostTerminalService extends Disposable implements I
 	public async $acceptTerminalTitleChange(id: number, name: string): Promise<void> {
 		const terminal = this._getTerminalById(id);
 		if (terminal) {
-			terminal.name = name;
+			const original = terminal.name;
+			if (original !== name) {
+				terminal.name = name;
+				this._onDidChangeTerminalName.fire(terminal);
+			}
 		}
 	}