diff --git a/changelog.d/14314.bugfix b/changelog.d/14314.bugfix
new file mode 100644
index 000000000..8be47ee08
--- /dev/null
+++ b/changelog.d/14314.bugfix
@@ -0,0 +1 @@
+Fix room creation being rate limited too aggressively since Synapse v1.69.0.
\ No newline at end of file
diff --git a/synapse/api/ratelimiting.py b/synapse/api/ratelimiting.py
index 044c7d492..511790c7c 100644
--- a/synapse/api/ratelimiting.py
+++ b/synapse/api/ratelimiting.py
@@ -343,6 +343,7 @@ class RequestRatelimiter:
         requester: Requester,
         update: bool = True,
         is_admin_redaction: bool = False,
+        n_actions: int = 1,
     ) -> None:
         """Ratelimits requests.
 
@@ -355,6 +356,8 @@ class RequestRatelimiter:
             is_admin_redaction: Whether this is a room admin/moderator
                 redacting an event. If so then we may apply different
                 ratelimits depending on config.
+            n_actions: Multiplier for the number of actions to apply to the
+                rate limiter at once.
 
         Raises:
             LimitExceededError if the request should be ratelimited
@@ -383,7 +386,9 @@ class RequestRatelimiter:
         if is_admin_redaction and self.admin_redaction_ratelimiter:
             # If we have separate config for admin redactions, use a separate
             # ratelimiter as to not have user_ids clash
-            await self.admin_redaction_ratelimiter.ratelimit(requester, update=update)
+            await self.admin_redaction_ratelimiter.ratelimit(
+                requester, update=update, n_actions=n_actions
+            )
         else:
             # Override rate and burst count per-user
             await self.request_ratelimiter.ratelimit(
@@ -391,4 +396,5 @@ class RequestRatelimiter:
                 rate_hz=messages_per_second,
                 burst_count=burst_count,
                 update=update,
+                n_actions=n_actions,
             )
diff --git a/synapse/handlers/room.py b/synapse/handlers/room.py
index 638f54051..d74b675ad 100644
--- a/synapse/handlers/room.py
+++ b/synapse/handlers/room.py
@@ -559,7 +559,6 @@ class RoomCreationHandler:
             invite_list=[],
             initial_state=initial_state,
             creation_content=creation_content,
-            ratelimit=False,
         )
 
         # Transfer membership events
@@ -753,6 +752,10 @@ class RoomCreationHandler:
                 )
 
         if ratelimit:
+            # Rate limit once in advance, but don't rate limit the individual
+            # events in the room — room creation isn't atomic and it's very
+            # janky if half the events in the initial state don't make it because
+            # of rate limiting.
             await self.request_ratelimiter.ratelimit(requester)
 
         room_version_id = config.get(
@@ -913,7 +916,6 @@ class RoomCreationHandler:
             room_alias=room_alias,
             power_level_content_override=power_level_content_override,
             creator_join_profile=creator_join_profile,
-            ratelimit=ratelimit,
         )
 
         if "name" in config:
@@ -1037,7 +1039,6 @@ class RoomCreationHandler:
         room_alias: Optional[RoomAlias] = None,
         power_level_content_override: Optional[JsonDict] = None,
         creator_join_profile: Optional[JsonDict] = None,
-        ratelimit: bool = True,
     ) -> Tuple[int, str, int]:
         """Sends the initial events into a new room. Sends the room creation, membership,
         and power level events into the room sequentially, then creates and batches up the
@@ -1046,6 +1047,8 @@ class RoomCreationHandler:
         `power_level_content_override` doesn't apply when initial state has
         power level state event content.
 
+        Rate limiting should already have been applied by this point.
+
         Returns:
             A tuple containing the stream ID, event ID and depth of the last
             event sent to the room.
@@ -1144,7 +1147,7 @@ class RoomCreationHandler:
             creator.user,
             room_id,
             "join",
-            ratelimit=ratelimit,
+            ratelimit=False,
             content=creator_join_profile,
             new_room=True,
             prev_event_ids=[last_sent_event_id],
@@ -1269,7 +1272,10 @@ class RoomCreationHandler:
             events_to_send.append((encryption_event, encryption_context))
 
         last_event = await self.event_creation_handler.handle_new_client_event(
-            creator, events_to_send, ignore_shadow_ban=True
+            creator,
+            events_to_send,
+            ignore_shadow_ban=True,
+            ratelimit=False,
         )
         assert last_event.internal_metadata.stream_ordering is not None
         return last_event.internal_metadata.stream_ordering, last_event.event_id, depth
diff --git a/tests/rest/client/test_rooms.py b/tests/rest/client/test_rooms.py
index 716366eb9..1084d4ad9 100644
--- a/tests/rest/client/test_rooms.py
+++ b/tests/rest/client/test_rooms.py
@@ -54,6 +54,7 @@ from tests.http.server._base import make_request_with_cancellation_test
 from tests.storage.test_stream import PaginationTestCase
 from tests.test_utils import make_awaitable
 from tests.test_utils.event_injection import create_event
+from tests.unittest import override_config
 
 PATH_PREFIX = b"/_matrix/client/api/v1"
 
@@ -871,6 +872,41 @@ class RoomsCreateTestCase(RoomBase):
         self.assertEqual(channel.code, HTTPStatus.OK, channel.json_body)
         self.assertEqual(join_mock.call_count, 0)
 
+    def _create_basic_room(self) -> Tuple[int, object]:
+        """
+        Tries to create a basic room and returns the response code.
+        """
+        channel = self.make_request(
+            "POST",
+            "/createRoom",
+            {},
+        )
+        return channel.code, channel.json_body
+
+    @override_config(
+        {
+            "rc_message": {"per_second": 0.2, "burst_count": 10},
+        }
+    )
+    def test_room_creation_ratelimiting(self) -> None:
+        """
+        Regression test for #14312, where ratelimiting was made too strict.
+        Clients should be able to create 10 rooms in a row
+        without hitting rate limits, using default rate limit config.
+        (We override rate limiting config back to its default value.)
+
+        To ensure we don't make ratelimiting too generous accidentally,
+        also check that we can't create an 11th room.
+        """
+
+        for _ in range(10):
+            code, json_body = self._create_basic_room()
+            self.assertEqual(code, HTTPStatus.OK, json_body)
+
+        # The 6th room hits the rate limit.
+        code, json_body = self._create_basic_room()
+        self.assertEqual(code, HTTPStatus.TOO_MANY_REQUESTS, json_body)
+
 
 class RoomTopicTestCase(RoomBase):
     """Tests /rooms/$room_id/topic REST events."""
@@ -1390,10 +1426,22 @@ class RoomJoinRatelimitTestCase(RoomBase):
     )
     def test_join_local_ratelimit(self) -> None:
         """Tests that local joins are actually rate-limited."""
-        for _ in range(3):
-            self.helper.create_room_as(self.user_id)
+        # Create 4 rooms
+        room_ids = [
+            self.helper.create_room_as(self.user_id, is_public=True) for _ in range(4)
+        ]
 
-        self.helper.create_room_as(self.user_id, expect_code=429)
+        joiner_user_id = self.register_user("joiner", "secret")
+        # Now make a new user try to join some of them.
+
+        # The user can join 3 rooms
+        for room_id in room_ids[0:3]:
+            self.helper.join(room_id, joiner_user_id)
+
+        # But the user cannot join a 4th room
+        self.helper.join(
+            room_ids[3], joiner_user_id, expect_code=HTTPStatus.TOO_MANY_REQUESTS
+        )
 
     @unittest.override_config(
         {"rc_joins": {"local": {"per_second": 0.5, "burst_count": 3}}}