diff --git a/eng/common/TestResources/New-TestResources.ps1 b/eng/common/TestResources/New-TestResources.ps1
index 3e5a60f5585c..08705c7248e7 100644
--- a/eng/common/TestResources/New-TestResources.ps1
+++ b/eng/common/TestResources/New-TestResources.ps1
@@ -400,17 +400,13 @@ try {
         exit
     }
 
-    $UserName = GetUserName
-
-    if (!$BaseName) {
-        if ($CI) {
-            $BaseName = 't' + (New-Guid).ToString('n').Substring(0, 16)
-            Log "Generated base name '$BaseName' for CI build"
-        } else {
-            $BaseName = GetBaseName $UserName (GetServiceLeafDirectoryName $ServiceDirectory)
-            Log "BaseName was not set. Using default base name '$BaseName'"
-        }
-    }
+    $serviceName = GetServiceLeafDirectoryName $ServiceDirectory
+    $BaseName, $ResourceGroupName = GetBaseAndResourceGroupNames `
+        -baseNameDefault $BaseName `
+        -resourceGroupNameDefault $ResourceGroupName `
+        -user (GetUserName) `
+        -serviceDirectoryName $serviceName `
+        -CI $CI
 
     # Make sure pre- and post-scripts are passed formerly required arguments.
     $PSBoundParameters['BaseName'] = $BaseName
@@ -546,19 +542,8 @@ try {
         $ProvisionerApplicationOid = $sp.Id
     }
 
-    $serviceName = GetServiceLeafDirectoryName $ServiceDirectory
-
-    $ResourceGroupName = if ($ResourceGroupName) {
-        $ResourceGroupName
-    } elseif ($CI) {
-        # Format the resource group name based on resource group naming recommendations and limitations.
-        "rg-{0}-$BaseName" -f ($serviceName -replace '[\.\\\/:]', '-').ToLowerInvariant().Substring(0, [Math]::Min($serviceName.Length, 90 - $BaseName.Length - 4)).Trim('-')
-    } else {
-        "rg-$BaseName"
-    }
-
     $tags = @{
-        Owners = $UserName
+        Owners = (GetUserName)
         ServiceDirectory = $ServiceDirectory
     }
 
diff --git a/eng/common/TestResources/Remove-TestResources.ps1 b/eng/common/TestResources/Remove-TestResources.ps1
index 069f2bf8a634..4e2b52c63a6d 100644
--- a/eng/common/TestResources/Remove-TestResources.ps1
+++ b/eng/common/TestResources/Remove-TestResources.ps1
@@ -147,14 +147,13 @@ if (!$ResourceGroupName) {
             exit 0
         }
     } else {
-        if (!$BaseName) {
-            $UserName = GetUserName
-            $BaseName = GetBaseName $UserName $ServiceDirectory
-            Log "BaseName was not set. Using default base name '$BaseName'"
-        }
-
-        # Format the resource group name like in New-TestResources.ps1.
-        $ResourceGroupName = "rg-$BaseName"
+        $serviceName = GetServiceLeafDirectoryName $ServiceDirectory
+        $BaseName, $ResourceGroupName = GetBaseAndResourceGroupNames `
+            -baseNameDefault $BaseName `
+            -resourceGroupNameDefault $ResourceGroupName `
+            -user (GetUserName) `
+            -serviceDirectoryName $serviceName `
+            -CI $CI
     }
 }
 
diff --git a/eng/common/TestResources/SubConfig-Helpers.ps1 b/eng/common/TestResources/SubConfig-Helpers.ps1
index cc93def6aa89..6a9d8ea79200 100644
--- a/eng/common/TestResources/SubConfig-Helpers.ps1
+++ b/eng/common/TestResources/SubConfig-Helpers.ps1
@@ -16,10 +16,40 @@ function GetUserName() {
     return $UserName
 }
 
-function GetBaseName([string]$user, [string]$serviceDirectoryName) {
+function GetBaseAndResourceGroupNames(
+    [string]$baseNameDefault,
+    [string]$resourceGroupNameDefault,
+    [string]$user,
+    [string]$serviceDirectoryName,
+    [bool]$CI
+) {
+    if ($CI) {
+        $base = 't' + (New-Guid).ToString('n').Substring(0, 16)
+        # Format the resource group name based on resource group naming recommendations and limitations.
+        $generatedGroup = "rg-{0}-$BaseName" -f ($serviceName -replace '[\.\\\/:]', '-').ToLowerInvariant().Substring(0, [Math]::Min($serviceName.Length, 90 - $BaseName.Length - 4)).Trim('-')
+        $group = $resourceGroupNameDefault ? $resourceGroupNameDefault : $generatedGroup
+
+        Log "Generated resource base name '$base' and resource group name '$group' for CI build"
+
+        return $base, $group
+    }
+
+    if ($baseNameDefault) {
+        $base = $baseNameDefault.ToLowerInvariant()
+        $group = $resourceGroupNameDefault ? $resourceGroupNameDefault : ("rg-$baseNameDefault".ToLowerInvariant())
+        return $base, $group
+    }
+
     # Handle service directories in nested directories, e.g. `data/aztables`
     $serviceDirectorySafeName = $serviceDirectoryName -replace '[\./\\]', ''
-    return "$user$serviceDirectorySafeName".ToLowerInvariant()
+    # Hash to keep resource names short enough to not break naming restrictions (e.g. keyvault name length)
+    $baseNameStream = [IO.MemoryStream]::new([Text.Encoding]::UTF8.GetBytes("${user}${serviceDirectorySafeName}"))
+    $base = 't' + (Get-FileHash -InputStream $baseNameStream -Algorithm SHA1).Hash.Substring(0, 16).ToLowerInvariant()
+    $group = $resourceGroupNameDefault ? $resourceGroupNameDefault : "rg-${user}${serviceDirectorySafeName}".ToLowerInvariant();
+
+    Log "BaseName was not set. Generating resource group name '$group' and resource base name '$base'"
+
+    return $base, $group
 }
 
 function ShouldMarkValueAsSecret([string]$serviceName, [string]$key, [string]$value, [array]$allowedValues = @())
diff --git a/eng/common/TestResources/Update-TestResources.ps1 b/eng/common/TestResources/Update-TestResources.ps1
index 7715ec4fcfbc..b57ee485fcf7 100644
--- a/eng/common/TestResources/Update-TestResources.ps1
+++ b/eng/common/TestResources/Update-TestResources.ps1
@@ -69,17 +69,13 @@ $exitActions = @({
     }
 })
 
-# Make sure $ResourceGroupName is set.
-if (!$ResourceGroupName) {
-    # Make sure $BaseName is set.
-    if (!$BaseName) {
-        $UserName = GetUserName
-        $BaseName = GetBaseName $UserName $ServiceDirectory
-        Log "BaseName was not set. Using default base name '$BaseName'"
-    }
-
-    $ResourceGroupName = "rg-$BaseName"
-}
+$serviceName = GetServiceLeafDirectoryName $ServiceDirectory
+$BaseName, $ResourceGroupName = GetBaseAndResourceGroupNames `
+    -baseNameDefault $BaseName `
+    -resourceGroupNameDefault $ResourceGroupName `
+    -user (GetUserName) `
+    -serviceDirectoryName $serviceName `
+    -CI $CI
 
 # This script is intended for interactive users. Make sure they are logged in or fail.
 $context = Get-AzContext
diff --git a/eng/common/TestResources/build-test-resource-config.yml b/eng/common/TestResources/build-test-resource-config.yml
index 2335f94f48db..215901c418b2 100644
--- a/eng/common/TestResources/build-test-resource-config.yml
+++ b/eng/common/TestResources/build-test-resource-config.yml
@@ -36,3 +36,4 @@ steps:
           UpdateSubscriptionConfiguration $configBase $config
 
         displayName: Merge Test Resource Configurations
+)
\ No newline at end of file