diff --git a/Makefile b/Makefile
index bd60c2ea24..da261f2344 100644
--- a/Makefile
+++ b/Makefile
@@ -297,7 +297,7 @@ unexport MACHINE
 
 GNU_HOST_NAME := $(shell support/gnuconfig/config.guess)
 
-TARGETS :=
+PACKAGES :=
 
 # silent mode requested?
 QUIET := $(if $(findstring s,$(filter-out --%,$(MAKEFLAGS))),-q)
@@ -389,16 +389,16 @@ include fs/common.mk
 
 include $(BR2_EXTERNAL)/external.mk
 
-TARGETS_SOURCE := $(patsubst %,%-source,$(TARGETS))
+PACKAGES_SOURCE := $(patsubst %,%-source,$(PACKAGES))
 
 # host-* dependencies have to be handled specially, as those aren't
-# visible in Kconfig and hence not added to a variable like TARGETS.
+# visible in Kconfig and hence not added to a variable like PACKAGES.
 # instead, find all the host-* targets listed in each <PKG>_DEPENDENCIES
 # variable for each enabled target.
 # Notice: this only works for newstyle gentargets/autotargets packages
 TARGETS_HOST_DEPS = $(sort $(filter host-%,$(foreach dep,\
 		$(addsuffix _DEPENDENCIES,\
-			$(call UPPERCASE,$(TARGETS) $(TARGETS_ROOTFS))),\
+			$(call UPPERCASE,$(PACKAGES) $(TARGETS_ROOTFS))),\
 		$($(dep)))))
 # Host packages can in turn have their own dependencies. Likewise find
 # all the package names listed in the HOST_<PKG>_DEPENDENCIES for each
@@ -410,8 +410,8 @@ HOST_DEPS = $(sort $(foreach dep,\
 		$($(dep))))
 HOST_SOURCE += $(addsuffix -source,$(sort $(TARGETS_HOST_DEPS) $(HOST_DEPS)))
 
-TARGETS_LEGAL_INFO := $(patsubst %,%-legal-info,\
-		$(TARGETS) $(TARGETS_HOST_DEPS) $(HOST_DEPS))
+PACKAGES_LEGAL_INFO := $(patsubst %,%-legal-info,\
+		$(PACKAGES) $(TARGETS_HOST_DEPS) $(HOST_DEPS))
 
 dirs: $(BUILD_DIR) $(STAGING_DIR) $(TARGET_DIR) \
 	$(HOST_DIR) $(BINARIES_DIR)
@@ -505,7 +505,7 @@ endif
 ifeq ($(BR2_TOOLCHAIN_USES_GLIBC),y)
 GLIBC_GENERATE_LOCALES = $(call qstrip,$(BR2_GENERATE_LOCALE))
 ifneq ($(GLIBC_GENERATE_LOCALES),)
-TARGETS += host-localedef
+PACKAGES += host-localedef
 
 define GENERATE_GLIBC_LOCALES
 	$(Q)mkdir -p $(TARGET_DIR)/usr/lib/locale/
@@ -549,7 +549,7 @@ endif
 
 $(TARGETS_ROOTFS): target-finalize
 
-target-finalize: $(TARGETS)
+target-finalize: $(PACKAGES)
 	@$(call MESSAGE,"Finalizing target directory")
 	$(foreach hook,$(TARGET_FINALIZE_HOOKS),$($(hook))$(sep))
 	rm -rf $(TARGET_DIR)/usr/include $(TARGET_DIR)/usr/share/aclocal \
@@ -613,7 +613,7 @@ target-post-image: $(TARGETS_ROOTFS) target-finalize
 		$(call MESSAGE,"Executing post-image script $(s)"); \
 		$(EXTRA_ENV) $(s) $(BINARIES_DIR) $(call qstrip,$(BR2_ROOTFS_POST_SCRIPT_ARGS))$(sep))
 
-source: $(TARGETS_SOURCE) $(HOST_SOURCE)
+source: $(PACKAGES_SOURCE) $(HOST_SOURCE)
 
 external-deps:
 	@$(MAKE1) -Bs DL_MODE=SHOW_EXTERNAL_DEPS $(EXTRAMAKEARGS) source | sort -u
@@ -631,7 +631,7 @@ legal-info-prepare: $(LEGAL_INFO_DIR)
 	@$(call legal-warning,the toolchain has not been saved)
 	@cp $(BR2_CONFIG) $(LEGAL_INFO_DIR)/buildroot.config
 
-legal-info: dirs legal-info-clean legal-info-prepare $(TARGETS_LEGAL_INFO) \
+legal-info: dirs legal-info-clean legal-info-prepare $(PACKAGES_LEGAL_INFO) \
 		$(REDIST_SOURCES_DIR_TARGET) $(REDIST_SOURCES_DIR_HOST)
 	@cat support/legal-info/README.header >>$(LEGAL_REPORT)
 	@if [ -r $(LEGAL_WARNINGS) ]; then \
@@ -642,7 +642,7 @@ legal-info: dirs legal-info-clean legal-info-prepare $(TARGETS_LEGAL_INFO) \
 	@rm -f $(LEGAL_WARNINGS)
 
 show-targets:
-	@echo $(HOST_DEPS) $(TARGETS_HOST_DEPS) $(TARGETS) $(TARGETS_ROOTFS)
+	@echo $(HOST_DEPS) $(TARGETS_HOST_DEPS) $(PACKAGES) $(TARGETS_ROOTFS)
 
 graph-build: $(O)/build/build-time.log
 	@install -d $(GRAPHS_DIR)
diff --git a/package/matchbox/matchbox.mk b/package/matchbox/matchbox.mk
index aec57c0a3b..fe1a7db59c 100644
--- a/package/matchbox/matchbox.mk
+++ b/package/matchbox/matchbox.mk
@@ -1,4 +1,4 @@
 ifeq ($(BR2_PACKAGE_MATCHBOX),y)
 include $(sort $(wildcard package/matchbox/*/*.mk))
-TARGETS += matchbox-lib matchbox-wm
+PACKAGES += matchbox-lib matchbox-wm
 endif
diff --git a/package/pkg-generic.mk b/package/pkg-generic.mk
index 1d56f81778..d1a18117d0 100644
--- a/package/pkg-generic.mk
+++ b/package/pkg-generic.mk
@@ -746,7 +746,7 @@ $(eval $(call check-deprecated-variable,$(2)_BUILD_OPT,$(2)_BUILD_OPTS))
 $(eval $(call check-deprecated-variable,$(2)_GETTEXTIZE_OPT,$(2)_GETTEXTIZE_OPTS))
 $(eval $(call check-deprecated-variable,$(2)_KCONFIG_OPT,$(2)_KCONFIG_OPTS))
 
-TARGETS += $(1)
+PACKAGES += $(1)
 
 ifneq ($$($(2)_PERMISSIONS),)
 PACKAGES_PERMISSIONS_TABLE += $$($(2)_PERMISSIONS)$$(sep)
diff --git a/support/scripts/graph-depends b/support/scripts/graph-depends
index 08ecc5a383..c26e1e06dc 100755
--- a/support/scripts/graph-depends
+++ b/support/scripts/graph-depends
@@ -116,7 +116,7 @@ def get_version(pkgs):
     return version
 
 # Execute the "make show-targets" command to get the list of the main
-# Buildroot TARGETS and return it formatted as a Python list. This
+# Buildroot PACKAGES and return it formatted as a Python list. This
 # list is used as the starting point for full dependency graphs
 def get_targets():
     sys.stderr.write("Getting targets\n")
diff --git a/system/system.mk b/system/system.mk
index 4a1eb4a4a1..c95e436c6e 100644
--- a/system/system.mk
+++ b/system/system.mk
@@ -35,7 +35,7 @@ TARGET_FINALIZE_HOOKS += SYSTEM_ISSUE
 endif
 
 ifneq ($(TARGET_GENERIC_ROOT_PASSWD),)
-TARGETS += host-mkpasswd
+PACKAGES += host-mkpasswd
 endif
 
 define SET_NETWORK_LOCALHOST