diff --git a/railties/lib/rails/engine.rb b/railties/lib/rails/engine.rb
index f8caaef213..909840da04 100644
--- a/railties/lib/rails/engine.rb
+++ b/railties/lib/rails/engine.rb
@@ -214,11 +214,11 @@ module Rails
   # as they would be created inside application. One of the cosequences of that is including
   # application's helpers and url_helpers inside controller. Sometimes, especially when your
   # engine provides its own routes, you don't want that. To isolate engine's stuff from application
-  # you can use namespace method:
+  # you can use isolate_namespace method:
   #
   #   module MyEngine
   #     class Engine < Rails::Engine
-  #       namespace MyEngine
+  #       isolate_namespace MyEngine
   #     end
   #   end
   #
@@ -252,7 +252,7 @@ module Rails
   #   end
   #
   #
-  # Additionaly namespaced engine will set its name according to namespace, so in that case:
+  # Additionaly isolated engine will set its name according to namespace, so in that case:
   # MyEngine::Engine.engine_name #=> "my_engine" and it will set MyEngine.table_name_prefix
   # to "my_engine_".
   #
@@ -315,7 +315,7 @@ module Rails
     autoload :Configuration, "rails/engine/configuration"
 
     class << self
-      attr_accessor :called_from, :namespaced
+      attr_accessor :called_from, :isolated
       alias :engine_name :railtie_name
 
       def inherited(base)
@@ -350,12 +350,12 @@ module Rails
         @endpoint
       end
 
-      def namespace(mod)
+      def isolate_namespace(mod)
         engine_name(generate_railtie_name(mod))
 
         name = engine_name
         self.routes.default_scope = {:module => name}
-        self.namespaced = true
+        self.isolated = true
 
         unless mod.respond_to?(:_railtie)
           _railtie = self
@@ -371,13 +371,13 @@ module Rails
         end
       end
 
-      def namespaced?
-        !!namespaced
+      def isolated?
+        !!isolated
       end
     end
 
     delegate :middleware, :root, :paths, :to => :config
-    delegate :engine_name, :namespaced?, :to => "self.class"
+    delegate :engine_name, :isolated?, :to => "self.class"
 
     def load_tasks
       super
@@ -506,7 +506,7 @@ module Rails
     end
 
     initializer :prepend_helpers_path do |app|
-      if !namespaced? || (app == self)
+      if !isolated? || (app == self)
         app.config.helpers_paths.unshift(*paths["app/helpers"].existent)
       end
     end
diff --git a/railties/test/generators/namespaced_generators_test.rb b/railties/test/generators/namespaced_generators_test.rb
index 38b95a49ac..d1190fd17d 100644
--- a/railties/test/generators/namespaced_generators_test.rb
+++ b/railties/test/generators/namespaced_generators_test.rb
@@ -6,14 +6,14 @@ require 'rails/generators/mailer/mailer_generator'
 
 class NamespacedGeneratorTestCase < Rails::Generators::TestCase
   def setup
-    TestApp::Application.namespace(TestApp)
+    TestApp::Application.isolate_namespace(TestApp)
   end
 
   def teardown
     if TestApp.respond_to?(:_railtie)
       TestApp.singleton_class.send(:undef_method, :_railtie)
       TestApp.singleton_class.send(:undef_method, :table_name_prefix)
-      TestApp::Application.namespaced = false
+      TestApp::Application.isolated = false
     end
   end
 end
diff --git a/railties/test/railties/engine_test.rb b/railties/test/railties/engine_test.rb
index 0ce11b1f79..db74e41472 100644
--- a/railties/test/railties/engine_test.rb
+++ b/railties/test/railties/engine_test.rb
@@ -394,7 +394,7 @@ module RailtiesTest
       @plugin.write "lib/bukkits.rb", <<-RUBY
         module Bukkits
           class Engine < ::Rails::Engine
-            namespace Bukkits
+            isolate_namespace Bukkits
           end
         end
       RUBY
@@ -511,7 +511,7 @@ module RailtiesTest
       @plugin.write "lib/bukkits.rb", <<-RUBY
         module Bukkits
           class Engine < ::Rails::Engine
-            namespace Bukkits
+            isolate_namespace Bukkits
           end
         end
       RUBY
@@ -572,7 +572,7 @@ module RailtiesTest
       @plugin.write "lib/bukkits.rb", <<-RUBY
         module Bukkits
           class Engine < ::Rails::Engine
-            namespace(Bukkits)
+            isolate_namespace(Bukkits)
           end
         end
       RUBY
@@ -593,7 +593,7 @@ module RailtiesTest
         @plugin.write "lib/bukkits.rb", <<-RUBY
           module Bukkits
             class Engine < ::Rails::Engine
-              namespace(Bukkits)
+              isolate_namespace(Bukkits)
               paths["public"] = "#{File.join(@plugin.path, "alternate_public")}"
             end
           end
@@ -611,7 +611,7 @@ module RailtiesTest
         @plugin.write "lib/bukkits.rb", <<-RUBY
           module Bukkits
             class Engine < ::Rails::Engine
-              namespace(Bukkits)
+              isolate_namespace(Bukkits)
               paths["public"] = "#{File.join(@plugin.path, "not_existing")}"
             end
           end
@@ -648,12 +648,12 @@ module RailtiesTest
       @plugin.write "lib/bukkits.rb", <<-RUBY
         module AppTemplate
           class Engine < ::Rails::Engine
-            namespace(AppTemplate)
+            isolate_namespace(AppTemplate)
           end
         end
       RUBY
 
-      add_to_config "namespace AppTemplate"
+      add_to_config "isolate_namespace AppTemplate"
 
       app_file "config/routes.rb", <<-RUBY
         AppTemplate::Application.routes.draw do end
@@ -686,7 +686,7 @@ module RailtiesTest
       @plugin.write "lib/bukkits.rb", <<-RUBY
         module Bukkits
           class Engine < ::Rails::Engine
-            namespace(Bukkits)
+            isolate_namespace(Bukkits)
           end
         end
       RUBY
diff --git a/railties/test/railties/mounted_engine_test.rb b/railties/test/railties/mounted_engine_test.rb
index b52ced92ec..47a4753e78 100644
--- a/railties/test/railties/mounted_engine_test.rb
+++ b/railties/test/railties/mounted_engine_test.rb
@@ -49,7 +49,7 @@ module ApplicationTests
       @plugin.write "lib/blog.rb", <<-RUBY
         module Blog
           class Engine < ::Rails::Engine
-            namespace(Blog)
+            isolate_namespace(Blog)
           end
         end
       RUBY