diff --git a/.changeset/calm-scissors-rescue.md b/.changeset/calm-scissors-rescue.md
new file mode 100644
index 0000000000..4a5318d240
--- /dev/null
+++ b/.changeset/calm-scissors-rescue.md
@@ -0,0 +1,5 @@
+---
+'@backstage/create-app': patch
+---
+
+Create unique temp directory for each `create-app` execution.
diff --git a/packages/create-app/src/createApp.test.ts b/packages/create-app/src/createApp.test.ts
index 47c62520e0..7cb9733567 100644
--- a/packages/create-app/src/createApp.test.ts
+++ b/packages/create-app/src/createApp.test.ts
@@ -36,10 +36,6 @@ const templatingMock = jest.spyOn(tasks, 'templatingTask');
 const checkAppExistsMock = jest.spyOn(tasks, 'checkAppExistsTask');
 const tryInitGitRepositoryMock = jest.spyOn(tasks, 'tryInitGitRepository');
 const readGitConfig = jest.spyOn(tasks, 'readGitConfig');
-const createTemporaryAppFolderMock = jest.spyOn(
-  tasks,
-  'createTemporaryAppFolderTask',
-);
 const moveAppMock = jest.spyOn(tasks, 'moveAppTask');
 const buildAppMock = jest.spyOn(tasks, 'buildAppTask');
 
@@ -73,7 +69,6 @@ describe('command entrypoint', () => {
     const cmd = {} as unknown as Command;
     await createApp(cmd);
     expect(checkAppExistsMock).toHaveBeenCalled();
-    expect(createTemporaryAppFolderMock).toHaveBeenCalled();
     expect(tryInitGitRepositoryMock).toHaveBeenCalled();
     expect(templatingMock).toHaveBeenCalled();
     expect(templatingMock.mock.lastCall?.[0]).toEqual(
@@ -85,7 +80,7 @@ describe('command entrypoint', () => {
         'default-app',
       ),
     );
-    expect(templatingMock.mock.lastCall?.[1]).toEqual(
+    expect(templatingMock.mock.lastCall?.[1]).toContain(
       path.join(tmpdir(), 'MyApp'),
     );
     expect(moveAppMock).toHaveBeenCalled();
diff --git a/packages/create-app/src/createApp.ts b/packages/create-app/src/createApp.ts
index efa299a3c9..bfa53f03c0 100644
--- a/packages/create-app/src/createApp.ts
+++ b/packages/create-app/src/createApp.ts
@@ -20,12 +20,12 @@ import inquirer, { Answers } from 'inquirer';
 import { resolve as resolvePath } from 'path';
 import { findPaths } from '@backstage/cli-common';
 import os from 'os';
+import fs from 'fs-extra';
 import {
   Task,
   buildAppTask,
   checkAppExistsTask,
   checkPathExistsTask,
-  createTemporaryAppFolderTask,
   moveAppTask,
   templatingTask,
   tryInitGitRepository,
@@ -37,7 +37,6 @@ const DEFAULT_BRANCH = 'master';
 export default async (opts: OptionValues): Promise<void> => {
   /* eslint-disable-next-line no-restricted-syntax */
   const paths = findPaths(__dirname);
-
   const answers: Answers = await inquirer.prompt([
     {
       type: 'input',
@@ -68,7 +67,6 @@ export default async (opts: OptionValues): Promise<void> => {
   const templateDir = opts.templatePath
     ? paths.resolveTarget(opts.templatePath)
     : paths.resolveOwn('templates/default-app');
-  const tempDir = resolvePath(os.tmpdir(), answers.name);
 
   // Use `--path` argument as application directory when specified, otherwise
   // create a directory using `answers.name`
@@ -100,7 +98,9 @@ export default async (opts: OptionValues): Promise<void> => {
       await checkAppExistsTask(paths.targetDir, answers.name);
 
       Task.section('Creating a temporary app directory');
-      await createTemporaryAppFolderTask(tempDir);
+      const tempDir = await fs.mkdtemp(
+        resolvePath(resolvePath(os.tmpdir(), answers.name)),
+      );
 
       Task.section('Preparing files');
       await templatingTask(templateDir, tempDir, {
diff --git a/packages/create-app/src/lib/tasks.test.ts b/packages/create-app/src/lib/tasks.test.ts
index 781e6a126c..68afdc9222 100644
--- a/packages/create-app/src/lib/tasks.test.ts
+++ b/packages/create-app/src/lib/tasks.test.ts
@@ -24,7 +24,6 @@ import {
   buildAppTask,
   checkAppExistsTask,
   checkPathExistsTask,
-  createTemporaryAppFolderTask,
   moveAppTask,
   templatingTask,
   tryInitGitRepository,
@@ -163,30 +162,6 @@ describe('tasks', () => {
     });
   });
 
-  describe('createTemporaryAppFolderTask', () => {
-    it('should create a directory at a given path', async () => {
-      const tempDir = 'projects/tmpFolder';
-      await expect(
-        createTemporaryAppFolderTask(tempDir),
-      ).resolves.not.toThrow();
-      expect(fs.existsSync(tempDir)).toBe(true);
-    });
-
-    it('should fail if a directory of the same name exists', async () => {
-      const tempDir = 'projects/dir';
-      await expect(createTemporaryAppFolderTask(tempDir)).rejects.toThrow(
-        'file already exists',
-      );
-    });
-
-    it('should fail if a file of the same name exists', async () => {
-      const tempDir = 'projects/dir/my-file.txt';
-      await expect(createTemporaryAppFolderTask(tempDir)).rejects.toThrow(
-        'file already exists',
-      );
-    });
-  });
-
   describe('buildAppTask', () => {
     it('should change to `appDir` and run `yarn install` and `yarn tsc`', async () => {
       const mockChdir = jest.spyOn(process, 'chdir');
diff --git a/packages/create-app/src/lib/tasks.ts b/packages/create-app/src/lib/tasks.ts
index 1943b0c3cc..90e6f6ae53 100644
--- a/packages/create-app/src/lib/tasks.ts
+++ b/packages/create-app/src/lib/tasks.ts
@@ -178,22 +178,6 @@ export async function checkPathExistsTask(path: string) {
   });
 }
 
-/**
- * Create a folder to store templated files
- *
- * @param tempDir - target temporary directory
- * @throws if `fs.mkdir` fails
- */
-export async function createTemporaryAppFolderTask(tempDir: string) {
-  await Task.forItem('creating', 'temporary directory', async () => {
-    try {
-      await fs.mkdir(tempDir);
-    } catch (error) {
-      throw new Error(`Failed to create temporary app directory, ${error}`);
-    }
-  });
-}
-
 /**
  * Run `yarn install` and `run tsc` in application directory
  *