diff --git a/changelog.d/3836.misc.rst b/changelog.d/3836.misc.rst
new file mode 100644
index 0000000000..95232cca4e
--- /dev/null
+++ b/changelog.d/3836.misc.rst
@@ -0,0 +1,9 @@
+Fixed interaction between ``setuptools``' package auto-discovery and
+auto-generated ``htmlcov`` files.
+
+Previously, the ``htmlcov`` name was ignored when searching for single-file
+modules, however the correct behaviour is to ignore it when searching for
+packages (since it is supposed to be a directory, see `coverage config`_)
+-- by :user:`yukihiko-shinoda`.
+
+.. _coverage config: https://coverage.readthedocs.io/en/stable/config.html#html-directory
diff --git a/setuptools/discovery.py b/setuptools/discovery.py
index 6244a18558..f053dba837 100644
--- a/setuptools/discovery.py
+++ b/setuptools/discovery.py
@@ -234,6 +234,7 @@ class FlatLayoutPackageFinder(PEP420PackageFinder):
         "benchmarks",
         "exercise",
         "exercises",
+        "htmlcov",  # Coverage.py
         # ---- Hidden directories/Private packages ----
         "[._]*",
     )
@@ -273,7 +274,6 @@ class FlatLayoutModuleFinder(ModuleFinder):
         "benchmarks",
         "exercise",
         "exercises",
-        "htmlcov",
         # ---- Hidden files/Private modules ----
         "[._]*",
     )
diff --git a/setuptools/tests/test_find_packages.py b/setuptools/tests/test_find_packages.py
index efcce924e5..6c605e02b4 100644
--- a/setuptools/tests/test_find_packages.py
+++ b/setuptools/tests/test_find_packages.py
@@ -217,6 +217,7 @@ class TestFlatLayoutPackageFinder:
         ),
         "tool-specific": (
             [
+                "htmlcov/index.html",
                 "pkg/__init__.py",
                 "tasks/__init__.py",
                 "tasks/subpackage/__init__.py",