diff --git a/changelogs/fragments/phasing-out-datacenters.yml b/changelogs/fragments/phasing-out-datacenters.yml
new file mode 100644
index 0000000..07f3494
--- /dev/null
+++ b/changelogs/fragments/phasing-out-datacenters.yml
@@ -0,0 +1,32 @@
+release_summary: |
+  This release is phasing out datacenters in ``Primary IPs`` and ``Servers``.
+
+  We added a new ``location`` property to the request body and response of ``Servers`` and ``Primary IPs``.
+  The same data was previously present under ``datacenter.location``.
+
+  We deprecated the ``datacenter`` property in the request body and response of ``Servers`` and ``Primary IPs``.
+  The removal will happen after 1 July 2026.
+
+  See our `changelog`_ for more details.
+
+  .. _changelog: https://docs.hetzner.cloud/changelog#2025-12-16-phasing-out-datacenters
+
+minor_changes:
+  - primary_ip - Added the ``location`` argument to create a Primary IP in a specific location.
+  - primary_ip - Added the Primary IP ``location`` name to the return values (``hcloud_primary_ip.location``).
+  - primary_ip_info - Added the Primary IPs ``location`` name to the return values (``hcloud_primary_ip_info[].location``).
+
+deprecated_features:
+  - hcloud inventory - The ``hcloud_datacenter`` host variable is deprecated and will be removed after 1 July 2026. Please use the ``hcloud_location`` host variable instead.
+
+  - primary_ip - The ``datacenter`` argument is deprecated and will be removed after 1 July 2026. Please use the ``location`` argument instead.
+  - primary_ip - The ``hcloud_primary_ip.datacenter`` return value is deprecated and will be removed after 1 July 2026. Please use the ``hcloud_primary_ip.location`` return value instead.
+
+  - primary_ip_info - The ``hcloud_primary_ip_info[].datacenter`` return value is deprecated and will be removed after 1 July 2026. Please use the ``hcloud_primary_ip_info[].location`` return value instead.
+
+  - server - The ``datacenter`` argument is deprecated and will be removed after 1 July 2026. Please use the ``location`` argument instead.
+  - server - The ``hcloud_server.datacenter`` return value is deprecated and will be removed after 1 July 2026. Please use the ``hcloud_server.location`` return value instead.
+
+  - server_info - The ``hcloud_server_info[].datacenter`` return value is deprecated and will be removed after 1 July 2026. Please use the ``hcloud_server_info[].location`` return value instead.
+
+  - network_info - The ``hcloud_network_info[].servers[].datacenter`` return value is deprecated and will be removed after 1 July 2026. Please use the ``hcloud_network_info[].servers[].location`` return value instead.
diff --git a/plugins/inventory/hcloud.py b/plugins/inventory/hcloud.py
index 0fb8981..93603f3 100644
--- a/plugins/inventory/hcloud.py
+++ b/plugins/inventory/hcloud.py
@@ -171,9 +171,12 @@ plugin: hetzner.hcloud.hcloud
 #   hcloud_image_id: 114690387
 #   hcloud_image_name: "debian-12"
 #   hcloud_image_os_flavor: "debian"
-## Datacenter
-#   hcloud_datacenter: "hel1-dc2"
+## Location
 #   hcloud_location: "hel1"
+#   # The hcloud_datacenter variable is deprecated and will be removed after 1 July 2026.
+#   # Please use the hcloud_location variable instead.
+#   # See https://docs.hetzner.cloud/changelog#2025-12-16-phasing-out-datacenters.
+#   hcloud_datacenter: "hel1-dc2"
 ## Network
 #   hcloud_ipv4: "65.109.140.95" # Value is optional!
 #   hcloud_ipv6: "2a01:4f9:c011:b83f::1" # Value is optional!
@@ -185,10 +188,11 @@ plugin: hetzner.hcloud.hcloud
 #       name: "my-private-network"
 #       ip: "10.0.0.3"
 #
-hostname: "my-prefix-{{ hcloud_datacenter }}-{{ hcloud_name }}-{{ hcloud_server_type }}"
+hostname: "my-prefix-{{ hcloud_location }}-{{ hcloud_name }}-{{ hcloud_server_type }}"
 """
 
 import sys
+import warnings
 from ipaddress import IPv6Network
 
 from ansible.errors import AnsibleError
@@ -230,7 +234,7 @@ if sys.version_info >= (3, 11):
         architecture: str
 
         # Datacenter
-        datacenter: str
+        datacenter: str  # Deprecated!
         location: str
 
         # Labels
@@ -322,7 +326,7 @@ class InventoryModule(BaseInventoryPlugin, Constructable, Cacheable):
 
         if self.get_option("locations"):
             locations: list[str] = self.get_option("locations")
-            servers = [s for s in servers if s.datacenter.location.name in locations]
+            servers = [s for s in servers if s.location.name in locations]
 
         if self.get_option("types"):
             server_types: list[str] = self.get_option("types")
@@ -365,9 +369,16 @@ class InventoryModule(BaseInventoryPlugin, Constructable, Cacheable):
                     server_dict["private_ipv4"] = private_net.ip
                     break
 
-        # Datacenter
-        server_dict["datacenter"] = server.datacenter.name
-        server_dict["location"] = server.datacenter.location.name
+        # Location
+        server_dict["location"] = server.location.name
+        with warnings.catch_warnings():
+            warnings.simplefilter("ignore", category=DeprecationWarning)
+            self.display.warning(
+                "The `hcloud_datacenter` variable is deprecated and will be removed "
+                "after 1 July 2026. Please use the `hcloud_location` variable instead. "
+                "See https://docs.hetzner.cloud/changelog#2025-12-16-phasing-out-datacenters."
+            )
+            server_dict["datacenter"] = server.datacenter and server.datacenter.name
 
         # Image
         if server.image is not None:
diff --git a/plugins/module_utils/primary_ip.py b/plugins/module_utils/primary_ip.py
index 9095796..7172711 100644
--- a/plugins/module_utils/primary_ip.py
+++ b/plugins/module_utils/primary_ip.py
@@ -11,7 +11,8 @@ def prepare_result(o: BoundPrimaryIP):
         "name": o.name,
         "ip": o.ip,
         "type": o.type,
-        "datacenter": o.datacenter.name,
+        "location": o.location.name,
+        "datacenter": o.datacenter and o.datacenter.name,
         "labels": o.labels,
         "delete_protection": o.protection["delete"],
         "assignee_id": o.assignee_id,
diff --git a/plugins/modules/network_info.py b/plugins/modules/network_info.py
index 8bbd47a..2f0289e 100644
--- a/plugins/modules/network_info.py
+++ b/plugins/modules/network_info.py
@@ -155,7 +155,12 @@ hcloud_network_info:
                     type: str
                     sample: fsn1
                 datacenter:
-                    description: Name of the datacenter of the server
+                    description: |
+                        Name of the datacenter of the server
+
+                        B(Deprecated:) The RV(hcloud_network_info[].servers[].datacenter) value is deprecated and will be removed
+                        after 1 July 2026. Please use the RV(hcloud_network_info[].servers[].location) value instead.
+                        See https://docs.hetzner.cloud/changelog#2025-12-16-phasing-out-datacenters.
                     returned: always
                     type: str
                     sample: fsn1-dc14
@@ -227,8 +232,8 @@ class AnsibleHCloudNetworkInfo(AnsibleHCloud):
                     "ipv6": server.public_net.ipv6.ip if server.public_net.ipv6 is not None else None,
                     "image": server.image.name if server.image is not None else None,
                     "server_type": server.server_type.name,
-                    "datacenter": server.datacenter.name,
-                    "location": server.datacenter.location.name,
+                    "datacenter": server.datacenter and server.datacenter.name,
+                    "location": server.location.name,
                     "rescue_enabled": server.rescue_enabled,
                     "backup_window": server.backup_window,
                     "labels": server.labels,
diff --git a/plugins/modules/primary_ip.py b/plugins/modules/primary_ip.py
index a09faa1..9ad81f6 100644
--- a/plugins/modules/primary_ip.py
+++ b/plugins/modules/primary_ip.py
@@ -24,17 +24,25 @@ options:
     id:
         description:
             - The ID of the Hetzner Cloud Primary IPs to manage.
-            - Only required if no Primary IP I(name) is given.
+            - Only required if no Primary IP O(name) is given.
         type: int
     name:
         description:
             - The Name of the Hetzner Cloud Primary IPs to manage.
-            - Only required if no Primary IP I(id) is given or a Primary IP does not exist.
+            - Only required if no Primary IP O(id) is given or a Primary IP does not exist.
+        type: str
+    location:
+        description:
+            - ID or name of the Location the Hetzner Cloud Primary IP will be bound to.
+            - Required if no O(server) or O(datacenter) is given and Primary IP does not exist.
         type: str
     datacenter:
         description:
+            - B(Deprecated:) The O(datacenter) argument is deprecated and will be removed
+              after 1 July 2026. Please use the O(location) argument instead.
+              See https://docs.hetzner.cloud/changelog#2025-12-16-phasing-out-datacenters.
             - Home Location of the Hetzner Cloud Primary IP.
-            - Required if no I(server) is given and Primary IP does not exist.
+            - Required if no O(server) or O(location) is given and Primary IP does not exist.
         type: str
     server:
         description:
@@ -76,14 +84,14 @@ EXAMPLES = """
 - name: Create a IPv4 Primary IP
   hetzner.hcloud.primary_ip:
     name: my-primary-ip
-    datacenter: fsn1-dc14
+    location: fsn1
     type: ipv4
     state: present
 
 - name: Create a IPv6 Primary IP
   hetzner.hcloud.primary_ip:
     name: my-primary-ip
-    datacenter: fsn1-dc14
+    location: fsn1
     type: ipv6
     state: present
 
@@ -134,8 +142,18 @@ hcloud_primary_ip:
             type: str
             returned: Always
             sample: ipv4
+        location:
+            description: Name of the Location of the Primary IP
+            type: str
+            returned: Always
+            sample: fsn1
         datacenter:
-            description: Name of the datacenter of the Primary IP
+            description: |
+                Name of the datacenter of the Primary IP
+
+                B(Deprecated:) The RV(hcloud_primary_ip.datacenter) value is deprecated and will be removed
+                after 1 July 2026. Please use the RV(hcloud_primary_ip.location) value instead.
+                See https://docs.hetzner.cloud/changelog#2025-12-16-phasing-out-datacenters.
             type: str
             returned: Always
             sample: fsn1-dc14
@@ -198,15 +216,26 @@ class AnsiblePrimaryIP(AnsibleHCloud):
     def _create(self):
         self.fail_on_invalid_params(
             required=["name", "type"],
-            required_one_of=[["server", "datacenter"]],
+            required_one_of=[["server", "location", "datacenter"]],
         )
         params = {
             "name": self.module.params.get("name"),
             "type": self.module.params.get("type"),
         }
 
-        if (value := self.module.params.get("datacenter")) is not None:
-            params["datacenter"] = self.client.datacenters.get_by_name(value)
+        if (value := self.module.params.get("location")) is not None:
+            params["location"] = self._client_get_by_name_or_id("locations", value)
+        elif (value := self.module.params.get("datacenter")) is not None:
+            self.module.warn(
+                "The `datacenter` argument is deprecated and will be removed "
+                "after 1 July 2026. Please use the `location` argument instead. "
+                "See https://docs.hetzner.cloud/changelog#2025-12-16-phasing-out-datacenters."
+            )
+            # Backward compatible datacenter argument.
+            # datacenter hel1-dc2 => location hel1
+            # pylint: disable=disallowed-name
+            part1, _, _ = str(value).partition("-")
+            params["location"] = self.client.locations.get_by_name(part1)
         elif (value := self.module.params.get("server")) is not None:
             server: BoundServer = self._client_get_by_name_or_id("servers", value)
             params["assignee_id"] = server.id
@@ -287,7 +316,12 @@ class AnsiblePrimaryIP(AnsibleHCloud):
             argument_spec=dict(
                 id={"type": "int"},
                 name={"type": "str"},
-                datacenter={"type": "str"},
+                location={"type": "str"},
+                datacenter={
+                    "type": "str",
+                    "removed_at_date": "2026-07-01",
+                    "removed_from_collection": "hetzner.hcloud",
+                },
                 server={"type": "str"},
                 auto_delete={"type": "bool", "default": False},
                 type={"choices": ["ipv4", "ipv6"]},
diff --git a/plugins/modules/primary_ip_info.py b/plugins/modules/primary_ip_info.py
index 8d3cdb4..b2ecb8f 100644
--- a/plugins/modules/primary_ip_info.py
+++ b/plugins/modules/primary_ip_info.py
@@ -99,8 +99,18 @@ hcloud_primary_ip_info:
             returned: always
             type: str
             sample: server
+        location:
+            description: Location where the Primary IP was created in.
+            returned: always
+            type: str
+            sample: fsn1
         home_location:
-            description: Location with datacenter where the Primary IP was created in
+            description: |
+                Datacenter where the Primary IP was created in.
+
+                B(Deprecated:) The RV(hcloud_primary_ip_info[].home_location) value is deprecated and will be removed
+                after 1 July 2026. Please use the RV(hcloud_primary_ip_info[].location) value instead.
+                See https://docs.hetzner.cloud/changelog#2025-12-16-phasing-out-datacenters.
             returned: always
             type: str
             sample: fsn1-dc1
@@ -152,7 +162,8 @@ class AnsibleHCloudPrimaryIPInfo(AnsibleHCloud):
                     "assignee_id": primary_ip.assignee_id if primary_ip.assignee_id is not None else None,
                     "assignee_type": primary_ip.assignee_type,
                     "auto_delete": primary_ip.auto_delete,
-                    "home_location": primary_ip.datacenter.name,
+                    "location": primary_ip.location.name,
+                    "home_location": primary_ip.datacenter and primary_ip.datacenter.name,
                     "dns_ptr": primary_ip.dns_ptr[0]["dns_ptr"] if len(primary_ip.dns_ptr) else None,
                     "labels": primary_ip.labels,
                     "delete_protection": primary_ip.protection["delete"],
diff --git a/plugins/modules/server.py b/plugins/modules/server.py
index d427d48..c3ef644 100644
--- a/plugins/modules/server.py
+++ b/plugins/modules/server.py
@@ -67,13 +67,16 @@ options:
     location:
         description:
             - Hetzner Cloud Location (name or ID) to create the server in.
-            - Required if no O(datacenter) is given and server does not exist.
+            - Required if the server does not exist.
             - Only used during the server creation.
         type: str
     datacenter:
         description:
+            - B(Deprecated:) The O(datacenter) argument is deprecated and will be removed
+              after 1 July 2026. Please use the O(location) argument instead.
+              See https://docs.hetzner.cloud/changelog#2025-12-16-phasing-out-datacenters.
             - Hetzner Cloud Datacenter (name or ID) to create the server in.
-            - Required if no O(location) is given and server does not exist.
+            - Required if no O(location) is given and the server does not exist.
             - Only used during the server creation.
         type: str
     backups:
@@ -303,7 +306,12 @@ hcloud_server:
             sample: 4711
             version_added: "1.5.0"
         datacenter:
-            description: Name of the datacenter of the server
+            description: |
+                Name of the datacenter of the server.
+
+                B(Deprecated:) The RV(hcloud_server.datacenter) value is deprecated and will be removed
+                after 1 July 2026. Please use the RV(hcloud_server.location) value instead.
+                See https://docs.hetzner.cloud/changelog#2025-12-16-phasing-out-datacenters.
             returned: always
             type: str
             sample: fsn1-dc14
@@ -384,8 +392,8 @@ class AnsibleHCloudServer(AnsibleHCloud):
             ],
             "image": self.hcloud_server.image.name if self.hcloud_server.image is not None else None,
             "server_type": self.hcloud_server.server_type.name,
-            "datacenter": self.hcloud_server.datacenter.name,
-            "location": self.hcloud_server.datacenter.location.name,
+            "datacenter": self.hcloud_server.datacenter and self.hcloud_server.datacenter.name,
+            "location": self.hcloud_server.location.name,
             "placement_group": (
                 self.hcloud_server.placement_group.name if self.hcloud_server.placement_group is not None else None
             ),
@@ -469,8 +477,22 @@ class AnsibleHCloudServer(AnsibleHCloud):
             params["location"] = self._client_get_by_name_or_id("locations", self.module.params.get("location"))
             server_type_location = params["location"]
         elif self.module.params.get("location") is None and self.module.params.get("datacenter") is not None:
-            params["datacenter"] = self._client_get_by_name_or_id("datacenters", self.module.params.get("datacenter"))
-            server_type_location = params["datacenter"].location
+            self.module.warn(
+                "The `datacenter` argument is deprecated and will be removed "
+                "after 1 July 2026. Please use the `location` argument instead. "
+                "See https://docs.hetzner.cloud/changelog#2025-12-16-phasing-out-datacenters."
+            )
+            value: str = self.module.params.get("datacenter")
+            # Backward compatible datacenter argument.
+            # datacenter hel1-dc2 => location hel1
+            if value and not value.isdigit():
+                # pylint: disable=disallowed-name
+                part1, _, _ = value.partition("-")
+                params["location"] = self.client.locations.get_by_name(part1)
+                server_type_location = params["location"]
+            else:
+                params["datacenter"] = self._client_get_by_name_or_id("datacenters", value)
+                server_type_location = params["datacenter"].location
 
         if self.module.params.get("state") == "stopped" or self.module.params.get("state") == "created":
             params["start_after_create"] = False
@@ -489,7 +511,7 @@ class AnsibleHCloudServer(AnsibleHCloud):
                     deprecated_server_type_warning(
                         self.module,
                         resp.server.server_type,
-                        resp.server.datacenter.location,
+                        resp.server.location,
                     )
 
                 self.result["root_password"] = resp.root_password
@@ -679,7 +701,7 @@ class AnsibleHCloudServer(AnsibleHCloud):
             deprecated_server_type_warning(
                 self.module,
                 self.hcloud_server.server_type,
-                self.hcloud_server.datacenter.location,
+                self.hcloud_server.location,
             )
             return
 
@@ -689,7 +711,7 @@ class AnsibleHCloudServer(AnsibleHCloud):
         deprecated_server_type_warning(
             self.module,
             server_type,
-            self.hcloud_server.datacenter.location,
+            self.hcloud_server.location,
         )
 
         self.stop_server_if_forced()
@@ -936,7 +958,11 @@ class AnsibleHCloudServer(AnsibleHCloud):
                 image_allow_deprecated={"type": "bool", "default": False, "aliases": ["allow_deprecated_image"]},
                 server_type={"type": "str"},
                 location={"type": "str"},
-                datacenter={"type": "str"},
+                datacenter={
+                    "type": "str",
+                    "removed_at_date": "2026-07-01",
+                    "removed_from_collection": "hetzner.hcloud",
+                },
                 user_data={"type": "str"},
                 ssh_keys={"type": "list", "elements": "str", "no_log": False},
                 volumes={"type": "list", "elements": "str"},
diff --git a/plugins/modules/server_info.py b/plugins/modules/server_info.py
index f709fe2..8e97d6e 100644
--- a/plugins/modules/server_info.py
+++ b/plugins/modules/server_info.py
@@ -113,7 +113,12 @@ hcloud_server_info:
             sample: 4711
             version_added: "1.5.0"
         datacenter:
-            description: Name of the datacenter of the server
+            description: |
+                Name of the datacenter of the server.
+
+                B(Deprecated:) The RV(hcloud_server_info[].datacenter) value is deprecated and will be removed
+                after 1 July 2026. Please use the RV(hcloud_server_info[].location) value instead.
+                See https://docs.hetzner.cloud/changelog#2025-12-16-phasing-out-datacenters.
             returned: always
             type: str
             sample: fsn1-dc14
@@ -175,8 +180,8 @@ class AnsibleHCloudServerInfo(AnsibleHCloud):
                     "private_networks_info": [{"name": net.network.name, "ip": net.ip} for net in server.private_net],
                     "image": server.image.name if server.image is not None else None,
                     "server_type": server.server_type.name,
-                    "datacenter": server.datacenter.name,
-                    "location": server.datacenter.location.name,
+                    "datacenter": server.datacenter and server.datacenter.name,
+                    "location": server.location.name,
                     "placement_group": server.placement_group.name if server.placement_group is not None else None,
                     "rescue_enabled": server.rescue_enabled,
                     "backup_window": server.backup_window,
diff --git a/tests/integration/targets/server/tasks/test.yml b/tests/integration/targets/server/tasks/test.yml
index e00bcce..2aa253a 100644
--- a/tests/integration/targets/server/tasks/test.yml
+++ b/tests/integration/targets/server/tasks/test.yml
@@ -3,6 +3,7 @@
 ---
 #- ansible.builtin.include_tasks: test_validation.yml
 - ansible.builtin.include_tasks: test_basic.yml
+- ansible.builtin.include_tasks: test_datacenter.yml
 #- ansible.builtin.include_tasks: test_firewalls.yml
 - ansible.builtin.include_tasks: test_primary_ips.yml
 - ansible.builtin.include_tasks: test_private_network_only.yml
diff --git a/tests/integration/targets/server/tasks/test_datacenter.yml b/tests/integration/targets/server/tasks/test_datacenter.yml
new file mode 100644
index 0000000..8dc50fc
--- /dev/null
+++ b/tests/integration/targets/server/tasks/test_datacenter.yml
@@ -0,0 +1,20 @@
+# Copyright: (c) 2019, Hetzner Cloud GmbH <info@hetzner-cloud.de>
+# GNU General Public License v3.0+ (see COPYING or https://www.gnu.org/licenses/gpl-3.0.txt)
+---
+- name: Test create server with datacenter (deprecated)
+  hetzner.hcloud.server:
+    name: "{{ hcloud_server_name }}"
+    server_type: "{{ hcloud_server_type_name }}"
+    image: "{{ hcloud_image_name }}"
+    datacenter: "{{ hcloud_datacenter_name }}"
+    state: created
+  register: result
+- name: Verify create server with datacenter (deprecated)
+  ansible.builtin.assert:
+    that:
+      - result is changed
+
+- name: Cleanup server with datacenter (deprecated)
+  hetzner.hcloud.server:
+    name: "{{ hcloud_server_name }}"
+    state: absent
diff --git a/tests/unit/inventory/test_hcloud.py b/tests/unit/inventory/test_hcloud.py
index 9c5b5c9..9e58903 100644
--- a/tests/unit/inventory/test_hcloud.py
+++ b/tests/unit/inventory/test_hcloud.py
@@ -33,18 +33,39 @@ def test_build_inventory_server():
                     "blocked": False,
                     "dns_ptr": "static.1.0.0.127.clients.your-server.de",
                 },
-                "ipv6": {"id": 56583279, "ip": "2001:db8::/64", "blocked": False, "dns_ptr": []},
+                "ipv6": {
+                    "id": 56583279,
+                    "ip": "2001:db8::/64",
+                    "blocked": False,
+                    "dns_ptr": [],
+                },
                 "floating_ips": [],
                 "firewalls": [],
             },
             "private_net": [],
-            "server_type": {"id": 109, "name": "cpx22", "architecture": "x86"},
+            "server_type": {
+                "id": 109,
+                "name": "cpx22",
+                "architecture": "x86",
+            },
+            "location": {
+                "id": 3,
+                "name": "hel1",
+            },
             "datacenter": {
                 "id": 3,
                 "name": "hel1-dc2",
-                "location": {"id": 3, "name": "hel1"},
+                "location": {
+                    "id": 3,
+                    "name": "hel1",
+                },
+            },
+            "image": {
+                "id": 114690387,
+                "name": "debian-12",
+                "os_flavor": "debian",
+                "os_version": "12",
             },
-            "image": {"id": 114690387, "name": "debian-12", "os_flavor": "debian", "os_version": "12"},
         },
     )
     # pylint: disable=protected-access